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Arrow Electronics (ARW) Gains But Lags Market: What You Should Know

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Arrow Electronics (ARW - Free Report) closed the most recent trading day at $127.68, moving +0.87% from the previous trading session. This change lagged the S&P 500's 1.17% gain on the day. Elsewhere, the Dow gained 0.8%, while the tech-heavy Nasdaq added 0.18%.

Coming into today, shares of the electronics maker had gained 1.13% in the past month. In that same time, the Computer and Technology sector lost 1.7%, while the S&P 500 gained 0.88%.

Arrow Electronics will be looking to display strength as it nears its next earnings release. On that day, Arrow Electronics is projected to report earnings of $4.53 per share, which would represent year-over-year growth of 59.51%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $8.67 billion, up 3.37% from the year-ago period.

ARW's full-year Zacks Consensus Estimates are calling for earnings of $18.48 per share and revenue of $35.31 billion. These results would represent year-over-year changes of +19.23% and +2.42%, respectively.

Investors might also notice recent changes to analyst estimates for Arrow Electronics. These revisions help to show the ever-changing nature of near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Research indicates that these estimate revisions are directly correlated with near-term share price momentum. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

Ranging from #1 (Strong Buy) to #5 (Strong Sell), the Zacks Rank system has a proven, outside-audited track record of outperformance, with #1 stocks returning an average of +25% annually since 1988. The Zacks Consensus EPS estimate remained stagnant within the past month. Arrow Electronics is holding a Zacks Rank of #1 (Strong Buy) right now.

Investors should also note Arrow Electronics's current valuation metrics, including its Forward P/E ratio of 6.85. For comparison, its industry has an average Forward P/E of 7.65, which means Arrow Electronics is trading at a discount to the group.

It is also worth noting that ARW currently has a PEG ratio of 2.19. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. Electronics - Parts Distribution stocks are, on average, holding a PEG ratio of 1.16 based on yesterday's closing prices.

The Electronics - Parts Distribution industry is part of the Computer and Technology sector. This industry currently has a Zacks Industry Rank of 1, which puts it in the top 1% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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