) reached a new 52-week high of $39.86 on Aug 13, 2013. Avnet
shares gained momentum since it announced fourth quarter 2013
results last week. Apart from this, the announcement of dividend
initiation also helped the stock to surge.
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The closing price of this information technology and provider on
Aug 13, 2013 was $39.85, representing a 1-year return of about
22.5% and a year-to-date return of about 25.0%. Average volume of
shares traded over the last three months stands at approximately
This Zacks Rank #2 (Buy) company has a market cap of $5.47
billion and a long-term expected earnings growth rate of 13.4%
(higher than industry average of 13.0%).
During the last quarter, Avnet witnessed revenue growth with
support from two of its business segments. Geographically,
contributions from Asia and Americas were relatively soft but
Europe was solid despite continuing macro issues.
Margins, though below the year-ago levels, benefited from the
ongoing cost reduction measures.
Avnet is also initiating a quarterly dividend of 15 cents a share
and the payment will be made on Sep 20, 2013. Avnet also stated
its intention to maintain the trend of returning value to
Avnet had a sizable cash balance and generated solid cash from
operations in the last quarter.
The Zacks Consensus Estimate for 2013 and 2014 rose 5 cents and
12 cents to $4.23 and $4.67 per share, respectively, in the past
7 days. The upside revision was supported by 6 and 3 estimate
revisions for fiscal 2013 and 2014, respectively, over the past 7
We think that the dividend announcement will increase shareholder
loyalty. Overall, we are positive on Avnet due to its acquisition
strategy (for market share growth, product portfolio enhancement
and geographic reach expansion) and continuous investments to tap
Other Stocks to Consider
Other stocks in the technology industry that are currently
performing well and have a solid visibility include
Semiconductor Manufacturing International Corp.
), all with a Zacks Rank #1 (Strong Buy).