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Tech Data (TECD) Q4 Earnings Beat Estimates, Revenues Miss
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Tech Data Corp. reported fourth-quarter fiscal 2017 results wherein non-GAAP earnings of $2.45 per share beat the Zacks Consensus Estimate by 27 cents. However, revenues of $7.43 billion missed the consensus mark of $7.52 billion.
On a year-over-year basis, earnings were up almost 7% while revenues declined nearly 0.8%. On a constant currency basis, revenues grew 2%.
Despite an overall weaker-than-expected demand environment, cost control measures helped the company to post stellar earnings.
Tech Data Corporation Price, Consensus and EPS Surprise
Revenues from the Americas (36.5% of revenues) were flat at $2.71 billion, while the same from Europe (63.6%) was down 1.34% to $4.72 billion on a year-over-year basis.
The company’s gross profit in the quarter was $371 million, which grew 4.6% from the year-ago quarter.
Non-GAAP selling, general & administrative (SG&A) expenses were up 4.6% year over year to almost $249 million in the reported quarter. As a percentage of revenues, SG&A expenses were 3.35% compared with 3.18% in the year-ago quarter.
Non-GAAP operating income grew 3.4% year over year to $127.2 million. Non-GAAP operating margin was 1.71% as compared with 1.64% in the year-ago quarter.
Geographically, non-GAAP operating income decreased 46.59% in the Americas and 11.13% year over year in Europe.
Balance Sheet and Cash Flow
At the end of the quarter, Tech Data had approximately $2.13 billion in cash and cash equivalents compared with $691.6 million as of Jan 31, 2016. In the quarter, cash provided by operations was $445 million.
Outlook
Tech Data didn’t provide first-quarter fiscal 2018 guidance due to the time constrain between the fourth-quarter results and the completion of Avnet’s (AVT - Free Report) Technology solutions business, which was completed recently. (Read More: Avnet Closes Sale of Technology Solutions to Tech Data)
Following the completion of the acquisition management targets cost savings of almost $50 million in first year and $100 million in the second year.
Zacks Rank & Key Picks
Currently, Tech Data has a Zacks Rank #1 (Strong Buy). We note that the stock has outperformed the Zacks Retail Computer Hardware industry in the last one-year. While the stock has gained 19.7%, the industry returned 17%.
Long term earnings growth rate for Ebix and LogMein is currently pegged at 10% and 22.5%, respectively.
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Tech Data (TECD) Q4 Earnings Beat Estimates, Revenues Miss
Tech Data Corp. reported fourth-quarter fiscal 2017 results wherein non-GAAP earnings of $2.45 per share beat the Zacks Consensus Estimate by 27 cents. However, revenues of $7.43 billion missed the consensus mark of $7.52 billion.
On a year-over-year basis, earnings were up almost 7% while revenues declined nearly 0.8%. On a constant currency basis, revenues grew 2%.
Despite an overall weaker-than-expected demand environment, cost control measures helped the company to post stellar earnings.
Tech Data Corporation Price, Consensus and EPS Surprise
Tech Data Corporation Price, Consensus and EPS Surprise | Tech Data Corporation Quote
Revenues from the Americas (36.5% of revenues) were flat at $2.71 billion, while the same from Europe (63.6%) was down 1.34% to $4.72 billion on a year-over-year basis.
The company’s gross profit in the quarter was $371 million, which grew 4.6% from the year-ago quarter.
Non-GAAP selling, general & administrative (SG&A) expenses were up 4.6% year over year to almost $249 million in the reported quarter. As a percentage of revenues, SG&A expenses were 3.35% compared with 3.18% in the year-ago quarter.
Non-GAAP operating income grew 3.4% year over year to $127.2 million. Non-GAAP operating margin was 1.71% as compared with 1.64% in the year-ago quarter.
Geographically, non-GAAP operating income decreased 46.59% in the Americas and 11.13% year over year in Europe.
Balance Sheet and Cash Flow
At the end of the quarter, Tech Data had approximately $2.13 billion in cash and cash equivalents compared with $691.6 million as of Jan 31, 2016. In the quarter, cash provided by operations was $445 million.
Outlook
Tech Data didn’t provide first-quarter fiscal 2018 guidance due to the time constrain between the fourth-quarter results and the completion of Avnet’s (AVT - Free Report) Technology solutions business, which was completed recently. (Read More: Avnet Closes Sale of Technology Solutions to Tech Data)
Following the completion of the acquisition management targets cost savings of almost $50 million in first year and $100 million in the second year.
Zacks Rank & Key Picks
Currently, Tech Data has a Zacks Rank #1 (Strong Buy). We note that the stock has outperformed the Zacks Retail Computer Hardware industry in the last one-year. While the stock has gained 19.7%, the industry returned 17%.
Other favorably placed stocks in the broader technology space include Ebix and LogMein , both sporting the same Zacks Rank. You can see the complete list of today’s Zacks #1 Rank stocks here.
Long term earnings growth rate for Ebix and LogMein is currently pegged at 10% and 22.5%, respectively.
8 Stocks with Huge Profit Potential
Just released: Driverless Cars: Your Roadmap to Mega-Profits Today. In this latest Special Report, Zacks’ Aggressive Growth Strategist Brian Bolan explores a full-blown technological breakthrough in the making – autonomous cars. He also spotlights 8 stocks with tremendous gain potential to feed off this phenomenon. Click to see the stocks right now >>