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Arrow Electronics, Inc. provides products, services, and solutions to industrial and commercial users of electronic components and enterprise computing solutions in the Americas, Europe, the Middle Ea...
The following section summarizes insights on Arrow Electronics Inc's Rule of 40:
We've identified the following companies as similar to Arrow Electronics Inc because they operate in a related industry or sector. We also considered size, growth, and various financial metrics to narrow down the list to the ones listed below.
To view the full list of supported financial metrics please see Complete Metrics Listing.
Metrics similar to Rule of 40 in the efficiency category include:
A ratio that measures a company’s combined growth rate and profit margin. Many venture capital and growth equity investors believe this ratio should e...
Rule of 40 measures a company’s combined growth and profit margin. Many venture capital and growth equity investors believe this ratio should exceed 40%, especially for software companies.
Rule of 40 = Levered Free Cash Flow Margin + Revenue Growth
Applying this formula, Arrow Electronics’s Rule of 40 is calculated below:
Levered Free Cash Flow Margin [ 3.7% ]
(+) Revenue Growth [ −15.7% ]
(=) Rule of 40 [ −11.9% ]
The tables below summarizes the trend in Arrow Electronics’s rule of 40 over the last five years:
| Date | Levered Free Cash Flow Margin | Revenue Growth | Rule of 40 |
|---|---|---|---|
| 2020-12-31 | 4.3% | −0.8% | 3.5% |
| 2021-12-31 | 1.0% | 20.2% | 21.2% |
| 2022-12-31 | −0.3% | 7.7% | 7.4% |
| 2023-12-31 | 1.9% | −10.8% | −8.9% |
| 2024-12-31 | 3.7% | −15.7% | −11.9% |
Read More: Hacking Software’s Rule of 40
The chart above depicts the distribution of rule of 40 for companies operating in the Information Technology sector in the Developed economic region. Over 2,310 companies were considered in this analysis, and 2,223 had meaningful values. The average rule of 40 of companies in the sector is -17.2% with a standard deviation of 137.9%.
Arrow Electronics Inc's Rule of 40 of -11.9% ranks in the 24.0% percentile for the sector. The following table provides additional summary stats:
| Economic Risk Region | Developed |
| Total Constituents | 2,315 |
| Included Constituents | 2,223 |
| Min | -1,562.9% |
| Max | 180.4% |
| Median | 9.4% |
| Mean | -17.2% |
| Standard Deviation | 137.9% |
You can find companies with similar rule of 40 using this stock screener.