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Synnex (SNX) Gains But Lags Market: What You Should Know

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Synnex (SNX - Free Report) closed the most recent trading day at $95.09, moving +0.55% from the previous trading session. This change lagged the S&P 500's 0.7% gain on the day. At the same time, the Dow added 0.58%, and the tech-heavy Nasdaq gained 0.69%.

Prior to today's trading, shares of the high-tech contractor had lost 4.94% over the past month. This has lagged the Computer and Technology sector's gain of 3.68% and the S&P 500's gain of 1.95% in that time.

Investors will be hoping for strength from SNX as it approaches its next earnings release. The company is expected to report EPS of $2.73, up 27.57% from the prior-year quarter. Our most recent consensus estimate is calling for quarterly revenue of $5.29 billion, up 16.12% from the year-ago period.

Looking at the full year, our Zacks Consensus Estimates suggest analysts are expecting earnings of $11.81 per share and revenue of $21.86 billion. These totals would mark changes of +8.45% and +9%, respectively, from last year.

Investors should also note any recent changes to analyst estimates for SNX. Recent revisions tend to reflect the latest near-term business trends. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Based on our research, we believe these estimate revisions are directly related to near-team stock moves. 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. Over the past month, the Zacks Consensus EPS estimate remained stagnant. SNX is currently sporting a Zacks Rank of #3 (Hold).

Valuation is also important, so investors should note that SNX has a Forward P/E ratio of 8.01 right now. For comparison, its industry has an average Forward P/E of 30.79, which means SNX is trading at a discount to the group.

The Business - Software Services industry is part of the Computer and Technology sector. This group has a Zacks Industry Rank of 45, putting it in the top 18% 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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