What Happened?
Shares of electronic components distributor Avnet (NASDAQGS:AVT) jumped 11.6% in the afternoon session after the company reported strong fourth-quarter results for its quarter ended December 2025, beating analyst estimates for both revenue and profit.
The electronic components distributor posted revenue of $6.32 billion, an increase of 11.6% year on year, surpassing consensus estimates by 4.9%. Furthermore, Avnet's adjusted earnings per share (EPS) came in at $1.05, a notable improvement from the $0.87 recorded in the year-ago quarter and 10.2% above expert forecasts. Adding to the positive results, the company issued optimistic revenue guidance for the next quarter of $6.35 billion at the midpoint, which was 7.9% higher than what analysts were expecting. The strong performance and surprisingly good outlook signaled a healthy quarter for the company, boosting investor confidence.
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What Is The Market Telling Us
Avnet’s shares are not very volatile and have only had 4 moves greater than 5% over the last year. Moves this big are rare for Avnet and indicate this news significantly impacted the market’s perception of the business.
The previous big move we wrote about was 7 days ago when the stock gained 3.5% on the news that President Trump cooled fears of a transatlantic trade war by calling off scheduled tariffs on European allies.
The rally followed a productive meeting in Davos with NATO Secretary General Mark Rutte, where a "framework of a future deal" regarding Greenland and the Arctic region was established. By explicitly ruling out the use of military force and suspending the 10% tariffs previously set for February 1st, the administration provided the "sigh of relief" the market desperately needed after Tuesday's sharp sell-off. Technology and semiconductor leaders like Nvidia and AMD spearheaded the recovery as investors quickly pivoted back into growth stocks.
The "Sell America" trade from the prior session reversed sharply, with the Nasdaq Composite jumping 1.5% and the S&P 500 erasing its 2026 losses. This rebound was further supported by a stabilization in the bond market; as tariff-related inflation fears subsided, the 10-year Treasury yield retreated from its recent highs, creating a more favorable backdrop for equity valuations across the board.
Avnet is up 21% since the beginning of the year, and at $59.69 per share, has set a new 52-week high. Investors who bought $1,000 worth of Avnet’s shares 5 years ago would now be looking at an investment worth $1,662.
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