Is Arrow Electronics, Inc. overvalued or undervalued?

As of 11 September 2025, the valuation grade for Arrow Electronics, Inc. has moved from fair to attractive, indicating a positive shift in its perceived value. The company appears to be undervalued, particularly when considering its P/E ratio of 27, which is lower than the peer average of 29.60 for similar companies like TD SYNNEX Corp. with a P/E of 17.48 and Resideo Technologies, Inc. at 24.70. Additionally, Arrow's EV to EBITDA ratio stands at 15.51, which is competitive compared to the industry, suggesting that the company is well-positioned relative to its peers.
Despite recent underperformance, with a 1-year return of -5.19% compared to the S&P 500's 17.14%, Arrow's long-term performance shows resilience, with a 5-year return of 53.84% against the S&P's 96.61%. This suggests that while the stock may be facing short-term challenges, its valuation metrics and peer comparisons indicate that it is currently undervalued and holds potential for future growth.