Avnet, Inc. (AVT) DCF Valuation & Fundamental Primer
Avnet, Inc. (AVT) currently trades at — with an enterprise value of $8.14B. Our proprietary institutional model rates Avnet, Inc. at 67/100 (Grade: B+ · Quality Software Operator).
Institutional fundamental teardown of Avnet, Inc. (AVT) covering SEC 10-K/10-Q cash flow conversion, SBC dilution friction, and Reverse-DCF valuation hurdles.
Avnet, Inc. (AVT) 3-Scenario DCF Valuation Range
Stress-test AVT's 5-year growth, target FCF margin, WACC, terminal methodology, and SBC/dilution friction in real time.
Split between 5-Year Explicit Cash Flows and Discounted Terminal Value
2D Institutional Valuation Sensitivity Heatmap
Implied share price & upside/downside spread across 25 valuation states (Current Price: —).
| WACC \ Terminal | 1.5% | 2.0% | 2.5% | 3.0% | 3.5% |
|---|---|---|---|---|---|
| 8.5% | $394.60 N/M | $420.05 N/M | $449.75 N/M | $484.85 N/M | $526.96 N/M |
| 9.3% | $352.84 N/M | $372.90 N/M | $395.92 N/M | $422.63 N/M | $453.98 N/M |
| 10.0% | $318.47 N/M | $334.59 N/M | $352.86 N/M | $373.74 N/M | $397.84 N/M |
| 10.8% | $289.67 N/M | $302.85 N/M | $317.63 N/M | $334.32 N/M | $353.31 N/M |
| 11.5% | $265.20 N/M | $276.14 N/M | $288.28 N/M | $301.86 N/M | $317.13 N/M |
Institutional Software Quality Scorecard (67/100 · Grade B+)
Solid software model with clear operating leverage, partially offset by standard SBC or moderate burn.
Strong cash conversion; 100%+ of operating profit turns into free cash
Minimal dilution friction; management compensation aligned with shareholders
Sub-par gross margins; higher cost of delivery or hardware/services mix
Moderate leverage or cash burn; monitor liquidity runway
Core Investment Strengths & Moats
- High cash conversion: 100%+ of operating income converted to free cash flow
- Low dilution friction: SBC is only 0.2% of revenue
Key Operational & Dilution Risks
- Lower software gross margins (10.7%), indicating higher hosting or service delivery drag
Avnet, Inc. (AVT) 5-Year Fundamental Forecast
| Statement Line Item | TTM Audited Base | TTM | Y1 | Y2 | Y3 | Y4 | Y5 |
|---|---|---|---|---|---|---|---|
| Revenue | $22.20B | $22.20B | $22.92B | $23.67B | $24.44B | $25.23B | $26.05B |
| Gross Profit | $2.38B | $2.38B | $2.46B | $2.54B | $2.62B | $2.71B | $2.80B |
| Operating Income (EBIT) | $514.3M | $515.1M | $531.8M | $549.1M | $566.9M | $585.4M | $604.4M |
| Stock-Based Compensation (SBC) | $36.4M | $35.5M | $36.7M | $37.9M | $39.1M | $40.4M | $41.7M |
| Unlevered Free Cash Flow (FCF) | $577.0M | $577.2M | $596.0M | $615.3M | $635.3M | $656.0M | $677.3M |
| SBC-Adjusted True Cash Flow | $540.6M | $541.7M | $559.3M | $577.5M | $596.2M | $615.6M | $635.6M |
Software & Cloud Services Peer Comparables & Rule of 40 Regression
Rule of 40 vs. EV / Revenue Multiple Regression
OLS Fit: EV/Rev = -30.2 + 0.82 × (Rule of 40) · R² = 79%Stocks below the gold regression line trade at a discount relative to their Rule of 40 compounding efficiency.
| Company | Ticker | Market Cap | TTM Revenue | Gross Margin | FCF Margin | Rule of 40 | SBC % Rev | EV / Rev |
|---|---|---|---|---|---|---|---|---|
| Avnet, Inc. | AVT | — | $22.20B | 10.7% | 2.6% | 5.9% | 0.2% | — |
| ServiceNow | NOW | $152.61B | $10.98B | 79.2% | 31.1% | 54.2% | 15.9% | 13.9× |
| Workday, Inc. | WDAY | $50.35B | $8.00B | 75.0% | 27.4% | 43.9% | 19.0% | 6.4× |
| Salesforce | CRM | $217.10B | $37.90B | 77.2% | 32.8% | 42.8% | 8.4% | 5.8× |
| Datadog | DDOG | $46.05B | $2.68B | 80.8% | 31.1% | 57.7% | 21.3% | 17.4× |
| Snowflake Inc. | SNOW | $71.79B | $3.63B | 66.5% | 25.2% | 57.7% | 40.8% | 20.0× |
| Hubspot | HUBS | $19.89B | $2.63B | 85.0% | 21.3% | 52.7% | 19.2% | 7.7× |
| Peer Cohort Median Benchmark (N=6) | 78.2% | 29.2% | 53.5% | 19.1% | 10.8× | |||
EV / Revenue Multiple Compression Stress Test
| Multiple Scenario | EV / Revenue | Implied Enterprise Value | Implied Equity Value | Implied Share Price | Delta vs Current |
|---|---|---|---|---|---|
| Current Multiple | 0.2× | $4.72B | $2.03B | $25.00 | 0.0% |
| -20% Multiple Compression | 0.2× | $3.78B | $1.09B | $13.40 | -20.0% |
| -35% Multiple Compression | 0.1× | $3.07B | $382.0M | $4.70 | -35.0% |
| Software Baseline Floor (5.0× EV/Rev) | 5.0× | $111.00B | $108.32B | $1,331.56 | +2252.3% |
Frequently Asked Questions: Avnet, Inc. (AVT) Valuation
What is Avnet, Inc. (AVT)'s intrinsic DCF valuation and implied share price?
Based on audited SEC 10-K/10-Q filings and a 5-year 3-statement discounted cash flow (DCF) model, Avnet, Inc. (AVT) has a Base Case implied value of N/A per share (with a Bear Case of N/A and a Bull Case of N/A), compared to its current price of market price. The model discounts projected free cash flows at a 10.0% WACC and a 2.5% terminal growth rate.
What is Avnet, Inc. (AVT)'s Rule of 40 score and Free Cash Flow margin?
Avnet, Inc. achieves a Rule of 40 score of 5.8%, combining a 3.3% revenue growth run-rate with a 2.6% TTM free cash flow margin on $22.20B in trailing twelve-month revenue. In the Software & Cloud Services peer cohort, the median Rule of 40 benchmark is 53.5%.
What revenue growth rate is priced into AVT stock according to Reverse-DCF analysis?
At market price per share (Enterprise Value of N/A), our Reverse-DCF solver indicates the market is pricing in a 5-year implied revenue CAGR of 3.3%, compared to Avnet, Inc.'s historical CAGR of 3.3%. Overall market expectations are rated as "Fairly Priced to Fundamentals".
How does Avnet, Inc. compare to Software & Cloud Services software peers?
Avnet, Inc. (AVT) earns an institutional Software Quality Score of 67/100 (Grade B+ — Quality Software Operator). Across its Software & Cloud Services peer group (NOW, WDAY, CRM, DDOG, SNOW), the cohort trades at a median EV/TTM Revenue multiple of 10.8× and a median gross margin of 78.2%.
How does Stock-Based Compensation (SBC) impact Avnet, Inc. (AVT)'s valuation?
Avnet, Inc. recorded $36.4M in TTM stock-based compensation (0.2% of revenue). When treating SBC as a cash-equivalent compensation expense, Avnet, Inc.'s SBC-adjusted free cash flow yield is evaluated directly in our 3-statement model, scoring 25/25 on our Shareholder Dilution Friction pillar.