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ScanSource (SCSC) Earnings Miss, Sales Beat Estimates in Q4
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ScanSource, Inc. (SCSC - Free Report) reported adjusted earnings of 91 cents per share in fourth-quarter fiscal 2022 (ended Jun 30, 2022), missing the Zacks Consensus Estimate of 94 cents. The bottom line declined 5% from the prior-year quarter’s earnings of 96 cents per share.
On a reported basis, the company delivered earnings of 78 cents per share compared with the prior-year quarter’s 80 cents per share.
The company reported net sales of $962 million in the reported quarter, up 13% from the year-ago quarter’s levels. The upside was driven by strong demand. The top line surpassed the Zacks Consensus Estimate of $904 million. Excluding foreign exchange impact, net sales were around $956 million in the quarter under review.
Net sales in the United States and Canada were up 12% to $865.7 million. International sales increased 19% to $96.5 million.
Specialty Technology Solutions’ revenues increased 13% to $581 million in fourth-quarter fiscal 2022, courtesy of broad-based demand across technologies.
Sales at Modern Communications & Cloud were $382 million in the reported quarter, up 13% year over year, driven by increased demand across communications solutions.
ScanSource, Inc. Price, Consensus and EPS Surprise
Cost of sales amounted to $851 million in the fiscal fourth quarter, up 12% from the year-ago quarter’ levels. The gross profit totaled $110.7 million, up 16% from the year-ago quarter’s $95.7 million. The gross margin came in at 11.5% during the reported quarter compared with the prior-year quarter’s 11.2%.
Selling, general and administrative expenses rose 17% year over year to $76 million. The adjusted operating profit was $31.9 million compared with the prior-year quarter’s $28.3 million. The adjusted operating margin was 3.3%, remaining flat year over year. Adjusted EBITDA was up 9.6% year over year to $39 million.
Financial Condition
The company reported cash and cash equivalents of $38 million as of Jun 30, 2022 compared with $63 million as of Jun 30, 2021. The company utilized $79 million of cash in operating activities in the fiscal fourth quarter against an inflow of $61 million in the prior-year quarter. The company’s long-term debt was $124 million at the end of fiscal 2022, down from $135 million at the end of fiscal 2021.
Fiscal 2022 Performance
ScanSource reported adjusted earnings per share of $3.97 in fiscal 2022 compared with $2.74 reported in the prior fiscal. Including one-time items, the bottom line came in at $3.44, up 93.3% from $1.78 reported in fiscal 2021. Sales were up 12% year over year to $3.5 billion.
Outlook
Backed by strong demand from channel partners across its technologies, ScanSource expects net sales growth of at least 5.5% in fiscal 2023. Adjusted EBITDA is projected to be at least $174 million.
Share Price Performance
ScanSource's shares have declined 3.6% in the past year compared with the industry’s fall of 35.6%.
Image Source: Zacks Investment Research
Zacks Rank and Stocks to Consider
ScanSource currently carries a Zacks Rank #3 (Hold).
Applied Industrial has an estimated earnings growth rate of 10.9% for fiscal 2023. In the past 60 days, the Zacks Consensus Estimate for fiscal 2023 earnings has been revised upward by 6%.
Applied Industrial pulled off a trailing four-quarter earnings surprise of 22.8%, on average. AIT’s shares have soared 32.2% in a year.
Greif has an estimated earnings growth rate of 37% for the current year. In the past 60 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 17%.
Greif pulled off a trailing four-quarter earnings surprise of 22.9%, on average. GEF’s shares have risen 18.6% in the past year.
Sonoco has an expected earnings growth rate of 78.3% for 2022. The Zacks Consensus Estimate for the current year’s earnings moved up 18% in the past 60 days.
Sonoco has a trailing four-quarter earnings surprise of 4.06%, on average. SON’s shares have moved up 1.7% in the past year.
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ScanSource (SCSC) Earnings Miss, Sales Beat Estimates in Q4
ScanSource, Inc. (SCSC - Free Report) reported adjusted earnings of 91 cents per share in fourth-quarter fiscal 2022 (ended Jun 30, 2022), missing the Zacks Consensus Estimate of 94 cents. The bottom line declined 5% from the prior-year quarter’s earnings of 96 cents per share.
On a reported basis, the company delivered earnings of 78 cents per share compared with the prior-year quarter’s 80 cents per share.
The company reported net sales of $962 million in the reported quarter, up 13% from the year-ago quarter’s levels. The upside was driven by strong demand. The top line surpassed the Zacks Consensus Estimate of $904 million. Excluding foreign exchange impact, net sales were around $956 million in the quarter under review.
Net sales in the United States and Canada were up 12% to $865.7 million. International sales increased 19% to $96.5 million.
Specialty Technology Solutions’ revenues increased 13% to $581 million in fourth-quarter fiscal 2022, courtesy of broad-based demand across technologies.
Sales at Modern Communications & Cloud were $382 million in the reported quarter, up 13% year over year, driven by increased demand across communications solutions.
ScanSource, Inc. Price, Consensus and EPS Surprise
ScanSource, Inc. price-consensus-eps-surprise-chart | ScanSource, Inc. Quote
Operational Update
Cost of sales amounted to $851 million in the fiscal fourth quarter, up 12% from the year-ago quarter’ levels. The gross profit totaled $110.7 million, up 16% from the year-ago quarter’s $95.7 million. The gross margin came in at 11.5% during the reported quarter compared with the prior-year quarter’s 11.2%.
Selling, general and administrative expenses rose 17% year over year to $76 million. The adjusted operating profit was $31.9 million compared with the prior-year quarter’s $28.3 million. The adjusted operating margin was 3.3%, remaining flat year over year. Adjusted EBITDA was up 9.6% year over year to $39 million.
Financial Condition
The company reported cash and cash equivalents of $38 million as of Jun 30, 2022 compared with $63 million as of Jun 30, 2021. The company utilized $79 million of cash in operating activities in the fiscal fourth quarter against an inflow of $61 million in the prior-year quarter. The company’s long-term debt was $124 million at the end of fiscal 2022, down from $135 million at the end of fiscal 2021.
Fiscal 2022 Performance
ScanSource reported adjusted earnings per share of $3.97 in fiscal 2022 compared with $2.74 reported in the prior fiscal. Including one-time items, the bottom line came in at $3.44, up 93.3% from $1.78 reported in fiscal 2021. Sales were up 12% year over year to $3.5 billion.
Outlook
Backed by strong demand from channel partners across its technologies, ScanSource expects net sales growth of at least 5.5% in fiscal 2023. Adjusted EBITDA is projected to be at least $174 million.
Share Price Performance
ScanSource's shares have declined 3.6% in the past year compared with the industry’s fall of 35.6%.
Image Source: Zacks Investment Research
Zacks Rank and Stocks to Consider
ScanSource currently carries a Zacks Rank #3 (Hold).
Some better-ranked stocks from the Industrial Products sector are Applied Industrial Technologies, Inc. (AIT - Free Report) , Greif Inc. (GEF - Free Report) and Sonoco Products Company (SON - Free Report) . While AIT sports a Zacks Rank #1 (Strong Buy), GEF and SON carry a Zacks Rank #2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank stocks here.
Applied Industrial has an estimated earnings growth rate of 10.9% for fiscal 2023. In the past 60 days, the Zacks Consensus Estimate for fiscal 2023 earnings has been revised upward by 6%.
Applied Industrial pulled off a trailing four-quarter earnings surprise of 22.8%, on average. AIT’s shares have soared 32.2% in a year.
Greif has an estimated earnings growth rate of 37% for the current year. In the past 60 days, the Zacks Consensus Estimate for current-year earnings has been revised upward by 17%.
Greif pulled off a trailing four-quarter earnings surprise of 22.9%, on average. GEF’s shares have risen 18.6% in the past year.
Sonoco has an expected earnings growth rate of 78.3% for 2022. The Zacks Consensus Estimate for the current year’s earnings moved up 18% in the past 60 days.
Sonoco has a trailing four-quarter earnings surprise of 4.06%, on average. SON’s shares have moved up 1.7% in the past year.