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RISK CONCERN
Investment Strategy, Risk Analysis, and Insights by Chartered Professionals
Scansource, Inc. (XNAS:SCSC) In-Depth Stock/Fundamental/Options Analysis Today
Primary Facts
SCSC
Name:
SCANSOURCE, INC. (XNAS:SCSC)
Sector:
- 56959.00K
Industry:
Electronics & Computer Distribution
CEO:
Mr. Michael Baur
Total Employees:
2,700
Our Technological Advancement Rating
Our Rating:
A+
Technological advancement compared to industry is 734.81% higher
ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF SCANSOURCE, INC.(SCSC) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND ELECTRONICS & COMPUTER DISTRIBUTION INDUSTRY. DATE: 07/09/2022
Primary Targets/Price Insights
Previous Close ($) :
28.51
One Month Price Target:
$28.74
Six Month Price Target :
$29.89
Likely Price in One Year's Time:
Ticker:
$31.26
Likely Trading Range Today Under (Normal Volatility)
$28.35
Price Upper limit ($) :
$28.68
Price Lower limit ($) :
Crash Risk Prep/Key Price Levels (High Volatility/Risk)
Price, as per data analysis, isn't likely to fall below:
Today:
$26.53
This week:
$24.08
This month :
$19.65
Other Primary facts
Market Cap:
718.09M
Market Cap Classification:
Small Cap
Number of Shares
IPO Date:
25.19M
Best/Worst Daily Performance (Last 3+ Years)
Highest Daily Appreciation:
15.29%
-22.69%
Worst Daily Decline:
Our Options Trading Entry Points
Iron Condor entry points for options expiring in 1 week's time
Low risk (<2%) entry points
Buy Call:
Sell Call:
Buy Put:
Sell Put:
$37.71
$33.51
$19.31
$23.51
Medium risk (<10%) entry points
Buy Call
Sell Call
$32.15
Buy Put:
Sell Put:
$31.25
$24.86
$25.77
These entry points can be used for other strategies, such as butterflies, straddles, etc.
Risk-Adjusted returns (Sharpe Ratio) of
SCSC
Sharpe Ratio:
0.32%
Comparison:
SCSC, is amongst the top 40% stocks with lowest risk-adjusted returns
Sharpe ratio is -70.62% lower than the industry
& is -85.98% lower than the market/S&P 500 average
Average Returns/Yield of
SCSC
Daily returns:
0.02%
Weekly returns:
0.10%
Monthly returns:
0.39%
Yearly returns:
8.65%
Comparison of returns:
Average annual returns/yield (last 3 years) is -45.38% below industry average
Classification:
SCSC, is amongst the top 60% highest yielding stocks in terms of daily returns
Results of T-Test of Returns:
0.78
Statistical test of Returns:
SCSC has yielded returns statistically similar to the market
Volatility (measured by Standard Deviation)
Daily Volatility:
3.39%
Weekly Volatility:
7.59%
Monthly Volatility:
15.17%
Yearly Volatility:
52.56%
Volitlilty of last five days (Measured by Standard Deviation)
Average Volatility of this Week:
1.13%
Volatility in last five trading days has been -66.69% below long-term volatility
Value at Risk Analysis (VaR)
Daily VaR:
-6.95%
Weekly VaR:
-15.54%
Monthly VaR:
-31.07%
How Much Can the price of
SCSC
Decline in a Recession?
Likely price decline in a recession:
Base case (decline):
-27%
Worst case (decline):
>85%
This translates to price declining to:
$20.74
This translates to price declining to:
$4.28
Severe Crash Probability
Risk of crash in next 6/12 months: Low (<25%)
What is Value at Risk (VaR)?
Risk Fundamentals
SCSC is a 119.30% riskier investment compared to the market/S&P 500 & is 87.87% riskier than Nasdaq (IXIC)
Risk (measured by volatility) is 24.95% above industry average
Overall, it is amongst the top 50% most risky stocks
Beta Examination of
SCSC
Beta in relation to market/S&P 500--1.44
Expected beta in 1 year's time:
1.058
Expected beta in 3 year's time:
1.496
Unlevered (debt free) Beta:
1.201
Beta in relation to Nasdaq (XNAS):
0.929
Beta in relation to all global stocks::
1.016
Beta Comparison & Analysis
Beta of competitors/peers::
1.172
Beta is 22.56% higher than peers
Average Industry Beta:
1.187
Beta is 20.92% above industry average
Sustainable Growth Rate Analysis
Sustainable growth rate for this stock/firm:
11.19%
Sustainable growth rate is -6.57% below industry average
Alpha provided | Alpha Analysis
Alpha provided:
-0.083
Alpha is 213.74% above industry average alpha yield
Alpha is -526% below the market average
Analysis of Cost of Capital of
SCSC
Equity cost of capital:
0.130
Equity cost of capital is 15.08% above industry mean WACC
Unlevered (without debt) cost of capital:
10.86%
Before-tax cost of debt:
3.18%
After-tax cost of debt:
2.51%
Overall debt rating:
High AA grade (second highest grade)
Weighted average cost of capital (WACC):
2.51%
WACC is 5.75% above industry mean WACC
Key Per-Share Metrics & Analysis
Revenue per share:
$135.80
Revenue growth rate per share of (3Y):
0.96
Annual revenue growth rate is -176.30% below industry average
EPS:
$3.58
Expected Annual growth rate of EPS (3Y):
12.34%
Expected future EPS growth rate is -10.26% lower than the Electronics & Computer Distribution industry
Free cash flow (FCF) per share:
-
-
-
Debt per share
$7.49
EBITDA per share
$6.46
Valuation Analysis Today of
SCSC
P/E Ratio:
8.28
P/E Ratio of Competitors/Peers:
220.67
P/E ratio is -96.25% lower than main peers & is -31.76% lower than the industry
Stock price/value with industry average P/E ratio: $43.45
SCSC is -34.38% undervalued if valued using industry average P/E ratio
-
-
P/S (Price to Sales ratio):
0.21
Price to sales ratio is -58.28% below the industry mean
P/B (Price to book value ratio):
0.96
-
-
Net income growth rate (3Y):
-67.31%
Net income growth rate is 48.64% higher than the average industry net income growth rate
Dividend Analysis
-
-
-
-
-
-
-
-
-
-
-
-
-
-
-
Dividend History:
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
--$0.00
-
In-depth Debt & Leverage Analysis
Debt to equity ratio:
25.27%
Net debt to equity ratio:
19.01%
Debt to assets ratio:
11.11%
Net debt to assets ratio:
8.36%
Debt-to-asset ratio is -79.68% below industry average
Ability to repay debt:
Interest coverage ratio:
25.93
Interest coverage ratio is 118.47% more than industry average
Looking forward:
Debt growth rate:
-25.02%
Annual debt growth is 41% higher than industry average debt growth rate
Debt repayment rate in last quarter: 71.49%
Analysis of Key Statistics
Correlation of price movement with the market:
0.58
Statistical significance of correlation:
SCSC has a statistically significant correlation with the market
Average Correlation of the industry with the market:
0.551
Stock price is 5.29% more correlated with the market, compared to the industry average correlation
R Squared (percentage of price movement explained by movement of the market):
0.551
Correlation of price movement with Nasdaq (^IXIC):
0.026
Covariance of price movement with the market:
0.052
Kurtosis
7.433
Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns
Skewness of returns:
-0.788
Returns are left (negative) skewed; mean returns are lower than median and mode returns
Fundamental Analysis & Dupont Analysis of
SCSC
Gross Profit Margin Ratio:
48%
Operating Profit Margin Ratio:
3.45%
Operating profit margin is 133.26% higher than the industry
Net Profit Margin Ratio:
48%
Effective Tax Rate:
22.56%
Effective tax rate is 45.88% higher than the industry
Dupont Method
Net Profit Margin
Return on Equity Ratio (ROE):
×
ROA
=
×
12.41%
Return on equity (ROE) is 27.80% higher than the industry
Financial Leverage
Asset Turnover Ratio (ROA):
5.45%
Return on assets (ROA) is 38.17% higher than the industry
Financial Leverage:
1.1x
Current Ratio:
1.81
Current ratio is -9.04% below industry average
Cash Conversion Cycle (days):
3.2
Cash conversion cycle is -95.18% below industry average
The remaining useful life of property plant & equipment is: 4.4 years
Stock based compensation to net income ratio:
2.78%
In-depth Efficiency Analysis
Revenue generated per employee:
1.3M
Each employee generates -11% less revenue than industry average revenue per employee
EBITDA generated per employee:
60.3K
Each employee generates -8% less EBITDA than industry average revenue per employee
Profit generated per employee:
34.3K
Each employee generates -15% less net income/profit than industry average revenue per employee
Free cash flow (FCF) generated per employee:
- 21.1K
Each employee generates 67% more free cash flow than industry average revenue per employee
Assets/Capital per employee
163.3K
Each employee generates 67% more free cash flow than industry average revenue per employee
Research & Development (R&D) Analysis
-
-
Competitors/Peer firms of
SCSC
CEVA, INC (XNAS:CEVA)
NETGEAR, INC. (XNAS:NTGR)
LATCH, INC. (XNAS:LTCH)
TELOS CORPORATION (XNAS:TLS)
Paya Holdings Inc. (XNAS:PAYA)
EBIX, INC. (XNAS:EBIX)
DIGI INTERNATIONAL INC. (XNAS:DGII)
VELODYNE LIDAR, INC (XNAS:VLDR)
AMERICAN SOFTWARE, INC. (XNAS:AMSWA)
Current Analyst Ratings
Strong buy�4%
Buy�4%
Hold�8%
Sell�0%
Strong sell�0%
Overall analyst sentiment is: Hold
Income Statement
Period:
TTM
Date:
3/31/22
Revenue:
3.42B
Cost of Revenue:
Gross Profit:
R&D Expense
General & Admin Expenses:
Selling, General & Admin Expenses
Sales and Marketing Expenses
Other Expenses :
Operating Expenses :
Cost & Expenses :
Interest Income:
Interest Expenses:
Depreciation & Amortization:
EBITDA:
Operating Income:
Other Income Expenses:
Income Before Tax:
Income Tax Expense:
Net Income:
Balance Sheet
Date:
Calendar Year:
Period:
Cash & Cash Equivalents:
Short Term Investments:
Cash & Short Term Investments:
Net Receivables:
Inventory:
Other Current Assets:
Total Current Assets:
PP&E:
Goodwill:
Intangible Assets:
Long Term Investments:
Tax Assets:
Other Non-Current Assets:
Total Non-Current Assets:
Other Assets:
Total Assets:
Accounts Payable:
Short Term Debt:
Tax Payables:
Deferred Revenue:
Other Current Liabilities:
Total Current Liabilities:
Long Term Debt:
Other Non-Current Liabilities:
Total Non Current Liabilities:
Other Liabilities:
Total Liabilities:
Common Stock:
Retained Earnings:
Accumulated Other Comprehensive Loss:
Other Total Stockholders' Equity:
Total Stockholders' Equity:
Total Liabilities and Stockholders' Equity:
Total Investments:
Total Debt:
Net Debt:
3.01B
411.51M
-
-
264.29M
-
22.25M
286.55M
2.42M
6.28M
37.92M
162.81M
118.03M
92.56M
115.46M
26.05M
92.56M
Statement of Cash Flow
Date:
Period:
7.65M
Differed Income Tax :
- 183.00K
Stock Based Compensation :
2.57M
Change in Working Capital :
- 88163.00K
Accounts Receivables:
- 26714.00K
Other Working Capital:
-
Other Non-Cash Items:
- 906.00K
Net Cash Provided by Operating Activities:
- 56959.00K
Investments in PP&E:
-
Net Acquisitions:
-
Purchases of Investments:
-
Sales/Maturities of Investments:
Other Investing Activities:
Net Cash Used for Investing Activities:
Debt Repayment:
Common Stock Issued:
Common Stock Repurchased:
Dividend Paid:
Other Financing Activities:
Net Cash Used Provided by Financing Activities:
Effect of FOREX on Changes in Cash:
Net Changes in Cash:
Cash at End of Period:
Cash at Beginning of Period:
Operating Cash Flow:
Capital Expenditure:
Free Cash Flow (FCF):
9/30/21
2022
Q1
55.49M
-
55.49M
589.53M
493.54M
117.85M
1.26B
40.76M
216.95M
99.50M
-
21.81M
61.93M
440.94M
-
1.70B
602.23M
8.79M
9.04M
-
81.40M
692.42M
188.57M
66.43M
258.84M
-
951.26M
74.82M
780.14M
- 108867.0K
-
September 30, 2021 at 6:00:00 AM
3.30B
746.09M
1.70B
-
197.36M
141.9M
-
- 1090.00K
- 1090.00K
- 472771.00K
-
-
-
527.63M
54.86M
- 4038.00K
- 7227.00K
55.49M
62.72M
- 56959.00K
- 1090.00K
- 56959.00K
Our Proprietary Portfolio Rating
Our Rating:
A+
Price Forecast/Expected Price in Next 5 Years of
SCSC
2023
2024
2025
2026
2027
$31.42
$273.83
$300.25
$329.22
$360.99