ScanSource (NASDAQ:SCSC) Shares Gap Down on Disappointing Earnings

ScanSource, Inc. (NASDAQ:SCSC) gapped down before the market opened on Thursday after the company announced weaker than expected quarterly earnings. The stock had previously closed at $56.98, but opened at $49.98. ScanSource shares last traded at $50.2760, with a volume of 35,705 shares traded.

The industrial products company reported $0.86 earnings per share for the quarter, missing the consensus estimate of $1.12 by ($0.26). ScanSource had a net margin of 2.44% and a return on equity of 10.10%. The company had revenue of $962.29 million for the quarter, compared to analysts’ expectations of $860.35 million. During the same quarter in the previous year, the company posted $1.06 EPS. The business’s quarterly revenue was up 30.1% on a year-over-year basis.

Analyst Ratings Changes

A number of research firms have commented on SCSC. Zacks Research cut ScanSource from a “strong-buy” rating to a “hold” rating in a research note on Tuesday, October 20th. Barclays lifted their target price on shares of ScanSource from $43.00 to $51.00 and gave the stock an “equal weight” rating in a research note on Monday, October 12th. Northcoast Research lowered shares of ScanSource from a “buy” rating to a “neutral” rating in a research report on Monday, August 17th. Weiss Ratings raised shares of ScanSource from a “hold (c+)” rating to a “buy (b-)” rating in a research note on Thursday, October 8th. Finally, Wall Street Zen upgraded shares of ScanSource from a “buy” rating to a “strong-buy” rating in a research report on Sunday, October 25th. One investment analyst has rated the stock with a Buy rating and three have given a Hold rating to the company’s stock. According to MarketBeat.com, the company presently has an average rating of “Hold” and a consensus price target of $51.00.

Insider Buying and Selling

In other ScanSource news, CEO Michael L. Baur sold 57,359 shares of the firm’s stock in a transaction on Friday, September 11th. The stock was sold at an average price of $58.04, for a total transaction of $3,329,116.36. Following the completion of the transaction, the chief executive officer owned 200,698 shares of the company’s stock, valued at approximately $11,648,511.92. This trade represents a 22.23% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is accessible through this link. Also, Director Charles Mathis sold 3,000 shares of the stock in a transaction on Friday, September 11th. The stock was sold at an average price of $58.00, for a total value of $174,000.00. Following the transaction, the director directly owned 25,027 shares in the company, valued at approximately $1,451,566. This represents a 10.70% decrease in their position. The SEC filing for this sale provides additional information. Over the last 90 days, insiders have sold 95,632 shares of company stock worth $5,484,582. Insiders own 3.18% of the company’s stock.

Institutional Inflows and Outflows

Institutional investors have recently modified their holdings of the business. Signaturefd LLC raised its stake in shares of ScanSource by 128.1% in the 3rd quarter. Signaturefd LLC now owns 2,108 shares of the industrial products company’s stock valued at $124,000 after purchasing an additional 1,184 shares in the last quarter. Freestone Grove Partners LP acquired a new stake in shares of ScanSource during the 2nd quarter valued at approximately $119,000. Mitsubishi UFJ Asset Management Co. Ltd. bought a new position in shares of ScanSource in the 2nd quarter worth about $134,000. Fulcrum Asset Management LLP boosted its stake in ScanSource by 6,672.0% in the third quarter. Fulcrum Asset Management LLP now owns 3,386 shares of the industrial products company’s stock valued at $196,000 after acquiring an additional 3,336 shares during the period. Finally, RHS Financial LLC acquired a new position in ScanSource during the 3rd quarter valued at approximately $210,000. Institutional investors and hedge funds own 97.91% of the company’s stock.

ScanSource Stock Down 11.3%

The firm has a market cap of $1.03 billion, a price-to-earnings ratio of 13.78, a price-to-earnings-growth ratio of 0.77 and a beta of 1.28. The stock has a 50-day moving average of $58.73 and a 200-day moving average of $48.07. The company has a current ratio of 1.76, a quick ratio of 1.15 and a debt-to-equity ratio of 0.11.

About ScanSource

ScanSource, Inc (NASDAQ: SCSC) is a technology distributor that connects manufacturers of business technology products with value-added resellers, systems integrators and other channel partners. The company provides products, services and expertise intended to help partners design, deploy and support technology solutions for business customers.

ScanSource’s offerings include point-of-sale and payment technology, barcode scanners, mobile computing devices, networking equipment, cybersecurity products, communications systems and cloud-based services.