|
Related Topics
|
Category: Stock Market and Synnex Corporation
Date: 30 September 2019 Stock Price: $112.51 We take a look at the 3rd quarter earnings release of their 2019 fiscal year of Synnex Corporation a provider of business process services such as distribution and logistics.
|
About Synnex Corporation
SYNNEX Corporation (NYSE: SNX) is a Fortune 200 corporation and a leading business process services company, providing a comprehensive range of distribution, logistics and integration services for the technology industry and providing outsourced services focused on customer engagement to a broad range of enterprises. SYNNEX distributes a broad range of information technology systems and products, and also provides systems design and integration solutions. Founded in 1980, SYNNEX Corporation operates in numerous countries throughout North and South America, Asia-Pacific and Europe. Additional information about SYNNEX may be found online at www.synnex.com.
Concentrix, a wholly-owned subsidiary of SYNNEX Corporation (NYSE: SNX), is a technology-enabled global business services company specializing in customer engagement and improving business performance for some of the world’s best brands. Every day, from more than 40 countries and across 6 continents, our staff delivers next generation customer experience and helps companies better connect with their customers. We create better business outcomes and help differentiate our clients through technology, design, data, process, and people. Concentrix provides services to clients in ten industry verticals: automotive; banking and financial services; insurance; healthcare; technology; consumer electronics; media and communications; retail and e-commerce; travel and transportation; energy and public-sector. We are Different by Design
Concentrix, a wholly-owned subsidiary of SYNNEX Corporation (NYSE: SNX), is a technology-enabled global business services company specializing in customer engagement and improving business performance for some of the world’s best brands. Every day, from more than 40 countries and across 6 continents, our staff delivers next generation customer experience and helps companies better connect with their customers. We create better business outcomes and help differentiate our clients through technology, design, data, process, and people. Concentrix provides services to clients in ten industry verticals: automotive; banking and financial services; insurance; healthcare; technology; consumer electronics; media and communications; retail and e-commerce; travel and transportation; energy and public-sector. We are Different by Design
Overview of Synnex's latest earnings report
The numbers we are interested in (for the quarter):
- Revenue: $6.203 billion (up from $4.882 billion from the same quarter of the previous year)
- Revenue increased by 27.05% over the last 12 months
- Net income $123.132 million (up from $66.940 million for the same quarter of the previous year)
- Diluted earnings per share: $2.40 (up from $1.68 for the same quarter of the previous year)
- Diluted weighted-average shares outstanding: 50.845 million (up from 39.475 million for the same quarter of the previous year)
- Cash and cash equivalents: $262.279 million
- Cash and cash equivalents per share: $5.15
- Cash and cash equivalents makes up 4.58% of Synnex Corporation market capital
- Cash and cash equivalents makes up 2.29% of Synnex Corporation's total assets
- Inventories: $2.787 billion
- Inventories makes up 24.39% of Synnex Corporation's total assets
- Accounts receivable: $3.452 billion
- Accounts receivable makes up 30.2% of Synnex Corporation's total assets. We get nervous whenever this is more than 20% of a company's total assets. Synnex will have to keep a very close eye on this.
- Stockholders equity in Synnex Corporation: $3.601 billion
- Stockholders equity per share for Synnex Corporation: $70.82
- Synnex Corporation is trading at 1.58 times its stockholders equity per share, which is outside the expected range of between 2 and 4 times that most firms tend to trade at.
Synnex's management commentary on the results and earnings guidance
REMONT, Calif., Sept. 24, 2019 /PRNewswire/ -- SYNNEX Corporation (NYSE: SNX), a leading business process services company, today announced financial results for the fiscal third quarter ended August 31, 2019.
"Our record performance reflects the continued success of our go-to-market strategies in each business segment," said Dennis Polk, SYNNEX President and CEO. "In the third quarter, our Technology Solutions revenue and earnings growth were exceptional, while Concentrix delivered another quarter of revenue expansion and superior execution."
Fourth Quarter Fiscal 2019 Outlook:
The following statements are based on SYNNEX' current expectations for the fourth quarter fiscal 2019. Non-GAAP financial measures exclude the impact of acquisition-related and integration expenses, the amortization of intangibles and the related tax effects thereon. These statements are forward-looking and actual results may differ materially.
Dividend Announcement
SYNNEX announced today that its Board of Directors declared a quarterly cash dividend of $0.375 per common share. The dividend is payable on October 25, 2019 to stockholders of record as of the close of business on October 11, 2019.
"Our record performance reflects the continued success of our go-to-market strategies in each business segment," said Dennis Polk, SYNNEX President and CEO. "In the third quarter, our Technology Solutions revenue and earnings growth were exceptional, while Concentrix delivered another quarter of revenue expansion and superior execution."
Fourth Quarter Fiscal 2019 Outlook:
The following statements are based on SYNNEX' current expectations for the fourth quarter fiscal 2019. Non-GAAP financial measures exclude the impact of acquisition-related and integration expenses, the amortization of intangibles and the related tax effects thereon. These statements are forward-looking and actual results may differ materially.
- Revenue is expected to be in the range of $5.85 billion to $6.15 billion.
- Net income is expected to be in the range of $136.4 million to $146.9 million and on a non-GAAP basis, net income is expected to be in the range of $180.5 million to $191.0 million.
- Diluted earnings per share is expected to be in the range of $2.64 to $2.85 and on a non-GAAP basis, diluted earnings per share is expected to be in the range of $3.50 to $3.70, based on estimated outstanding diluted weighted average shares of 51.1 million.
- After-tax amortization of intangibles is expected to be $37.9 million, or $0.73 per share.
- After-tax acquisition-related and integration expense is expected to be $6.3 million, or $0.12 per share.
Dividend Announcement
SYNNEX announced today that its Board of Directors declared a quarterly cash dividend of $0.375 per common share. The dividend is payable on October 25, 2019 to stockholders of record as of the close of business on October 11, 2019.
Synnex Corporation (NYSE: SNX) stock price history
The image below, obtained from Google, shows the stock price history of Synnex Corporation (SNX) over the last 5 years. And it's been a pretty good time for stockholders of Synnex. 5 years ago the stock was trading at around $65 and its currently trading at $112.51. That's a 73.1% return provided by Synnex over the last 5 years. The stock of Synnex is also trading at a lot closer to its 52 week high of $114.91 than it is to its 52 week low of $71.82 which to us is a clear indication that the short term sentiment and momentum of Synnex stock is positive.
Synnex Corporation (NYSE: SNX) latest stock valuation
So what is Synnex Corporation's (NYSE: SNX) stock worth based on the release of their latest earnings report and the outlook provided. Based on the earnings reported our valuation models provide a target (full value) price for Synnex Corporation of $140 a stock. We therefore believe that Synnex Corporation's stock is slightly undervalued at this point in time. We usually recommend long term fundamental or value investors buy into a stock at least 10% below our target (full value) price of $140, which would make a good entry point $126 or below. Since Synnex is trading well below this price we rate Synnex Corporation stock a buy