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Synnex (SNX) Outpaces Stock Market Gains: What You Should Know

Zacks Equity Research

In the latest trading session, Synnex (SNX) closed at $140.05, marking a +1.62% move from the previous day. This move outpaced the S&P 500's daily gain of 0.31%. Meanwhile, the Dow gained 0.44%, and the Nasdaq, a tech-heavy index, added 0.26%.

Heading into today, shares of the high-tech contractor had gained 7% over the past month, outpacing the Computer and Technology sector's gain of 4.64% and the S&P 500's gain of 1.18% in that time.

Investors will be hoping for strength from SNX as it approaches its next earnings release. On that day, SNX is projected to report earnings of $3.14 per share, which would represent year-over-year growth of 10.56%. Meanwhile, our latest consensus estimate is calling for revenue of $5.39 billion, up 2.71% from the prior-year quarter.

For the full year, our Zacks Consensus Estimates are projecting earnings of $13.97 per share and revenue of $23.01 billion, which would represent changes of +5.35% and -3.14%, respectively, from the prior year.

It is also important to note the recent changes to analyst estimates for SNX. These recent revisions tend to reflect the evolving nature of short-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. To benefit from this, we have developed the Zacks Rank, a proprietary model which takes these estimate changes into account and provides an actionable rating system.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. The Zacks Consensus EPS estimate has moved 5.89% higher within the past month. SNX is holding a Zacks Rank of #1 (Strong Buy) right now.

Looking at its valuation, SNX is holding a Forward P/E ratio of 9.86. This valuation marks a discount compared to its industry's average Forward P/E of 30.79.

It is also worth noting that SNX currently has a PEG ratio of 0.95. This metric is used similarly to the famous P/E ratio, but the PEG ratio also takes into account the stock's expected earnings growth rate. The Business - Software Services was holding an average PEG ratio of 2.67 at yesterday's closing price.

The Business - Software Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 36, putting it in the top 15% of all 250+ industries.

The Zacks Industry Rank includes is listed in order from best to worst in terms of the average Zacks Rank of the individual companies within each of these sectors. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

Make sure to utilize Zacks. Com to follow all of these stock-moving metrics, and more, in the coming trading sessions.

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