The 10-second takeaway
For the quarter ended Dec. 29 (Q2), Avnet beat expectations on revenues and crushed expectations on earnings per share.
Compared to the prior-year quarter, revenue was unchanged and GAAP earnings per share expanded.
Margins dropped across the board.
Avnet tallied revenue of $6.70 billion. The eight analysts polled by S&P Capital IQ anticipated revenue of $6.27 billion on the same basis. GAAP reported sales were 0.1% higher than the prior-year quarter's $6.69 billion.
Source: S&P Capital IQ. Quarterly periods. Dollar amounts in millions. Non-GAAP figures may vary to maintain comparability with estimates.
EPS came in at $1.01. The 12 earnings estimates compiled by S&P Capital IQ anticipated $0.83 per share. GAAP EPS of $0.99 for Q2 were 1.0% higher than the prior-year quarter's $0.98 per share.
Source: S&P Capital IQ. Quarterly periods. Non-GAAP figures may vary to maintain comparability with estimates.
For the quarter, gross margin was 11.5%, 20 basis points worse than the prior-year quarter. Operating margin was 2.9%, 110 basis points worse than the prior-year quarter. Net margin was 2.1%, 10 basis points worse than the prior-year quarter.
Next quarter's average estimate for revenue is $5.97 billion. On the bottom line, the average EPS estimate is $0.80.
Next year's average estimate for revenue is $24.26 billion. The average EPS estimate is $3.12.
The stock has a four-star rating (out of five) at Motley Fool CAPS, with 241 members out of 257 rating the stock outperform, and 16 members rating it underperform. Among 60 CAPS All-Star picks (recommendations by the highest-ranked CAPS members), 59 give Avnet a green thumbs-up, and one give it a red thumbs-down.
Of Wall Street recommendations tracked by S&P Capital IQ, the average opinion on Avnet is outperform, with an average price target of $33.00.
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