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ScanSource (SCSC) Outpaces Stock Market Gains: What You Should Know

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ScanSource (SCSC - Free Report) closed at $36.50 in the latest trading session, marking a +1.98% move from the prior day. This change outpaced the S&P 500's 1.05% gain on the day.

Prior to today's trading, shares of the technology products distributor had lost 4.71% over the past month. This has was narrower than the Industrial Products sector's loss of 8.84% and the S&P 500's loss of 5.07% in that time.

SCSC will be looking to display strength as it nears its next earnings release. On that day, SCSC is projected to report earnings of $0.75 per share, which would represent year-over-year growth of 78.57%. Meanwhile, the Zacks Consensus Estimate for revenue is projecting net sales of $802.2 million, up 2.52% from the year-ago period.

SCSC's full-year Zacks Consensus Estimates are calling for earnings of $3.23 per share and revenue of $3.32 billion. These results would represent year-over-year changes of +17.88% and +4.65%, respectively.

It is also important to note the recent changes to analyst estimates for SCSC. 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. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system ranges from #1 (Strong Buy) to #5 (Strong Sell). It has a remarkable, outside-audited track record of success, with #1 stocks delivering an average annual return of +25% since 1988. Over the past month, the Zacks Consensus EPS estimate remained stagnant. SCSC currently has a Zacks Rank of #1 (Strong Buy).

Investors should also note SCSC's current valuation metrics, including its Forward P/E ratio of 11.08. For comparison, its industry has an average Forward P/E of 20.73, which means SCSC is trading at a discount to the group.

The Industrial Services industry is part of the Industrial Products sector. This group has a Zacks Industry Rank of 108, putting it in the top 43% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

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