Avnet Inc

Shares of electronic components distributor Avnet jumped 5.2% in the afternoon session after demand rose for electronic components used in AI infrastructure and global data-center buildouts, according to TipRanks. Record trading levels reflected the AI and data-center cycle pulling through distributors, while sentiment also got a lift from normalizing supply chains in industrial and automotive end markets that broadened the demand backdrop beyond AI alone. After the initial pop, the shares cooled down to $107.15, up 4.8% from the previous close. Avnet is up 117% since the beginning of the year and, at $107.15 per share, has set a new 52-week high. The stock's biggest recent move came 8 months ago, when it gained 11.6% on strong fourth-quarter results for its quarter ended December 2025, posting revenue of $6.32 billion, up 11.6% year on year and 4.9% above consensus, with adjusted earnings per share of $1.05 versus $0.87 a year earlier and 10.2% above forecasts, alongside next-quarter revenue guidance of $6.35 billion at the midpoint, 7.9% above analyst expectations.

Avnet and The University of Hong Kong have officially opened the Emerging Microelectronics and Ubiquitous Systems Lab, or EMUS Lab, a collaborative innovation hub at the Data Technology Hub in Tseung Kwan O InnoPark aimed at accelerating AI hardware commercialization. The Lab focuses on next-generation technologies including edge AI, physical AI, robotics, high-performance computing and emerging microelectronics, offering innovators engineering consultation, GPU computing resources, prototyping support, manufacturability assessments and supply chain expertise. One of its first major industry engagement initiatives is the DfMA Launchpad for AI MMP Programme, a 12-month co-incubation programme linking EMUS Lab, Avnet and the startup ecosystem of Hong Kong Science and Technology Parks Corporation, which has already selected 27 startup teams to participate. Research supported by Avnet-sponsored GPU infrastructure has contributed to publications in Nature family journals and presentations at leading AI conferences including ICLR and ICML. Arthur Chung, Vice President, Sales and Supplier Management, Asia, at Avnet, said building a great AI model is only the beginning and that turning AI innovation into a reliable, manufacturable and scalable product remains one of the biggest barriers to commercialization. Prof. Ngai Wong, Associate Professor at the Department of Electrical and Computer Engineering at HKU Faculty of Engineering and Director of EMUS Lab, said the Lab was established to bridge the gap between cutting-edge research and real-world application.

Avnet, Inc. continues to benefit from strong artificial intelligence demand, with direct data-center business representing approximately 10-15% of total company sales, concentrated in Asia-Pacific. The company also sees indirect opportunities in industrial markets as hyperscaler expansion drives demand for cooling and power components. Fiscal 2026 IP&E sales reached approximately $4.6 billion, up from $4 billion in fiscal 2025, and fourth-quarter sales hit a record $8.3 billion, up 48% year over year. Avnet shares have soared 85.9% year-to-date, outperforming the industry's 59.8% growth, yet trade at a price-to-sales multiple of 0.21X versus the industry's 0.34X. For the first quarter of fiscal 2027, Avnet expects adjusted EPS of $2.80-$2.90, with estimates revised upward, and holds a Zacks Rank #1 (Strong Buy).

Avnet declared a quarterly dividend of $0.37 per share, a 5.7% increase from the prior dividend of $0.35. The dividend is payable on September 23 to shareholders of record on September 9, with the ex-dividend date also September 9. The forward yield is 1.7%.

DEEPX has expanded its commercial distribution network across the Asia-Pacific region through a strategic partnership with global technology distributor Avnet. The agreement builds on a Master Distributor Agreement signed with Avnet Europe BV last year and now enables Avnet Asia and its affiliates to distribute DEEPX products across 15 major APAC markets, including South Korea, Japan, China, Singapore, and key Southeast Asian markets. The collaboration aims to accelerate adoption of DEEPX's ultra-low-power on-device AI semiconductors in physical AI markets such as smart factories, robotics, autonomous vehicles, and smart cities. Joint marketing initiatives and technical seminars began on July 10 alongside Avnet's Edge AI & Beyond Tech Days 2026 events in Singapore and Vietnam. DEEPX CEO Lokwon Kim stated that scaling physical AI requires a complete ecosystem including software, support, and supply chain, and the expanded collaboration will apply European customer development experience to Asian markets.

Avnet shares have jumped 81.5% year to date, outpacing the Zacks Electronics - Parts Distribution industry's 63% gain. The company reported fiscal third-quarter revenue of $7.1 billion, up 34% year over year, driven by strong demand in AI infrastructure, networking, and industrial markets. Management noted that direct exposure to AI and data center customers has grown to nearly 10-15% of the business, up from 5-7% previously. Avnet expects fourth-quarter revenue between $7.3 billion and $7.6 billion, and the Zacks Consensus Estimate for fiscal 2026 revenue stands at $25.59 billion. Despite the rally, the stock trades at a price-to-sales multiple of 0.27, below the industry's 0.39, and carries a Zacks Rank of 2, or Buy.

Arrow Electronics and Avnet are highlighted as potentially undervalued stocks by Zacks Investment Research, based on their value metrics and earnings outlook. Arrow Electronics holds a Zacks Rank #1 (Strong Buy) and a Value grade of A, with a P/E ratio of 9.44 compared to its industry average of 14.76, a PEG ratio of 0.46 versus an industry average of 0.49, a P/B ratio of 0.98 against an industry average of 2.13, a P/S ratio of 0.32 compared to an industry average of 0.48, and a P/CF ratio of 9.63 versus an industry average of 18.54. Avnet, also in the Electronics - Parts Distribution industry, carries a Zacks Rank #2 (Buy) and a Value grade of A, with a forward P/E of 10.47, a PEG ratio of 0.36, and a P/B ratio of 0.89. Both companies' current valuations and strong earnings outlooks make them stand out as top value picks.

Zacks Investment Research added five stocks to its Zacks Rank Number 1 Strong Buy list on June 30th. Fomento Económico Mexicano, a beverage bottling company, saw its current-year earnings consensus estimate increase 18.5% over the last 60 days. Avnet, an electronic components company, had its estimate rise 10.8%. Tilly's, a specialty retailer, experienced a 64.7% increase. Reddit, an online community platform, saw a 21.4% rise. Hamilton Insurance Group, an insurance and reinsurance company, also had an 18.5% increase.