ScanSource (NASDAQ:SCSC) Stock Price Down 9.6% on Disappointing Earnings

ScanSource, Inc. (NASDAQ:SCSC)’s stock price dropped 9.6% during mid-day trading on Friday following a dissappointing earnings announcement. The company traded as low as $41.77 and last traded at $40.7610. Approximately 54,742 shares traded hands during trading, a decline of 78% from the average daily volume of 245,977 shares. The stock had previously closed at $45.07.

The industrial products company reported $0.86 earnings per share (EPS) for the quarter, missing the consensus estimate of $1.12 by ($0.26). ScanSource had a return on equity of 10.10% and a net margin of 2.44%. The company had revenue of $962.29 million during the quarter, compared to analyst estimates of $860.35 million. During the same period in the prior year, the business posted $1.06 earnings per share. ScanSource’s revenue was up 30.1% on a year-over-year basis.

Key ScanSource News

Here are the key news stories impacting ScanSource this week:

• Positive Sentiment: Fiscal 2027 revenue guidance is $3.8 billion to $4.0 billion, above the approximately $3.7 billion analyst consensus, pointing to a stronger sales outlook than expected. Article: ScanSource posts better-than-expected sales and guides for strong full-year sales
• Positive Sentiment: Quarterly revenue rose 30.1% year over year to $962.3 million, beating analysts’ estimate of $860.4 million. Article: ScanSource EPS misses while revenue beats
• Negative Sentiment: Adjusted EPS of $0.86 missed the $1.12 consensus and was below $1.06 a year earlier. The earnings shortfall suggests sales growth is not translating into stronger per-share profits, a key concern for investors. Article: ScanSource misses Q1 earnings estimates
• Negative Sentiment: Shares broke below the 200-day moving average following the disappointing earnings report, a technical signal that may add to near-term selling pressure. Article: ScanSource shares break below the 200-day moving average on disappointing earnings

Analyst Ratings Changes

Several brokerages recently issued reports on SCSC. Northcoast Research downgraded ScanSource from a “buy” rating to a “neutral” rating in a report on Monday, August 17th. Zacks Research cut ScanSource from a “strong-buy” rating to a “hold” rating in a research note on Tuesday, October 20th. Weiss Ratings raised ScanSource from a “hold (c+)” rating to a “buy (b-)” rating in a research report on Thursday, October 8th. Barclays increased their target price on ScanSource from $43.00 to $51.00 and gave the company an “equal weight” rating in a research note on Monday, October 12th. Finally, Wall Street Zen upgraded ScanSource from a “buy” rating to a “strong-buy” rating in a report on Sunday, October 25th. One analyst has rated the stock with a Buy rating and three have issued a Hold rating to the company’s stock. According to data from MarketBeat, the stock presently has an average rating of “Hold” and a consensus target price of $51.00.

Insider Transactions at ScanSource

In related news, CAO Brandy Ford sold 5,293 shares of the business’s stock in a transaction dated Friday, September 4th. The shares were sold at an average price of $57.43, for a total transaction of $303,976.99. Following the completion of the sale, the chief accounting officer owned 9,907 shares of the company’s stock, valued at $568,959.01. This represents a 34.82% decrease in their position. The sale was disclosed in a filing with the Securities & Exchange Commission, which is accessible through this hyperlink. Also, Director Charles Mathis sold 3,000 shares of the stock in a transaction that occurred on Friday, September 11th. The stock was sold at an average price of $58.00, for a total value of $174,000.00. Following the sale, the director owned 25,027 shares in the company, valued at $1,451,566. The trade was a 10.70% decrease in their ownership of the stock. Additional details regarding this sale are available in the official SEC disclosure. Insiders have sold a total of 95,632 shares of company stock worth $5,484,582 in the last quarter. Insiders own 3.18% of the company’s stock.

Institutional Trading of ScanSource

A number of large investors have recently modified their holdings of SCSC. Maryland State Retirement & Pension System bought a new stake in shares of ScanSource during the third quarter valued at about $261,000. Fulcrum Asset Management LLP lifted its holdings in ScanSource by 6,672.0% in the third quarter. Fulcrum Asset Management LLP now owns 3,386 shares of the industrial products company’s stock worth $196,000 after purchasing an additional 3,336 shares during the period. Ethic Inc. bought a new position in ScanSource in the 3rd quarter valued at about $285,000. Pictet Asset Management Holding SA bought a new position in shares of ScanSource in the third quarter valued at approximately $222,000. Finally, CenterBook Partners LP increased its position in shares of ScanSource by 56.9% during the 3rd quarter. CenterBook Partners LP now owns 14,917 shares of the industrial products company’s stock valued at $876,000 after purchasing an additional 5,412 shares during the period. Institutional investors and hedge funds own 97.91% of the company’s stock.

ScanSource Trading Down 9.6%

The company has a debt-to-equity ratio of 0.11, a current ratio of 1.76 and a quick ratio of 1.15. The business has a fifty day moving average of $58.51 and a 200-day moving average of $48.09. The stock has a market capitalization of $830.22 million, a price-to-earnings ratio of 11.14, a price-to-earnings-growth ratio of 0.78 and a beta of 1.28.

About ScanSource

ScanSource, Inc (NASDAQ: SCSC) is a technology distributor that connects manufacturers of business technology products with value-added resellers, systems integrators and other channel partners. The company provides products, services and expertise intended to help partners design, deploy and support technology solutions for business customers.

ScanSource’s offerings include point-of-sale and payment technology, barcode scanners, mobile computing devices, networking equipment, cybersecurity products, communications systems and cloud-based services.