Arrow Electronics (ARW)- Red Flag Note
Accounting gimmicks may have accounted for well more than the earnings beat
Arrow Electronics (ARW)’s adjusted EPS of $2.41 in 1Q24 beat estimates by 4 cents, However, it missed revenue forecasts by $118.8 million. Several factors complicate the analysis of ARW’s receivables, and after taking those into account, we see signs that ARW’s sales would have missed by much more had it not been for a buildup in receivables. We also noticed unusual timing of expenses which accounted for well more than the reported earnings beat.
Let’s get behind the numbers…