ScanSource (NASDAQ:SCSC) Announces Earnings Results

ScanSource (NASDAQ:SCSC) announced its quarterly earnings data on Thursday. The industrial products company reported $0.86 EPS for the quarter, missing the consensus estimate of $1.12 by ($0.26), FiscalAI reports. The business had revenue of $962.29 million during the quarter, compared to analysts’ expectations of $860.35 million. ScanSource had a net margin of 2.44% and a return on equity of 10.10%. ScanSource’s revenue was up 30.1% on a year-over-year basis. During the same quarter in the previous year, the firm earned $1.06 earnings per share.

Here are the key takeaways from ScanSource’s conference call:

• ScanSource raised its FY2027 outlook, including MicroAge, to $3.8 billion–$4.0 billion in net sales and $175 million–$185 million in adjusted EBITDA. It reaffirmed a target of at least $85 million in full-year free cash flow.
• Profitability lagged sales growth: net sales rose 30% year over year, while reported net profit increased 9%. Management attributed margin pressure to an unusually high mix of lower-margin large hardware deals—estimated to account for 110–120 basis points of compression—and a customer-specific bad-debt reserve in Brazil.
• Both segments grew sales and gross profit, with broad-based North American demand across security, networking, barcode mobility, and communications hardware. Management said the large-deal mix was unusual and expects a more balanced mix over the rest of the year.
• MicroAge expands ScanSource’s reach in cloud, cybersecurity, data center, and AI, and management sees potential to bring its managed services and AI solutions to existing channel partners. The company has begun a co-selling pilot, so the opportunity’s results are still being tested.
• Intelisys net billings grew 3.8%, and management is redirecting investment toward recruiting partners and generating new orders. The payoff may take time: the company said revenue realization can take six to nine months for smaller deals and 12 to 18 months for larger ones.

ScanSource Price Performance

Shares of SCSC stock traded down $2.29 on Friday, reaching $42.78. The company’s stock had a trading volume of 695,826 shares, compared to its average volume of 250,830. The stock’s fifty day simple moving average is $58.51 and its 200-day simple moving average is $48.09. ScanSource has a 1 year low of $33.76 and a 1 year high of $66.78. The company has a market capitalization of $871.43 million, a price-to-earnings ratio of 13.26, a price-to-earnings-growth ratio of 0.77 and a beta of 1.28. The company has a current ratio of 1.76, a quick ratio of 1.15 and a debt-to-equity ratio of 0.11.

Analysts Set New Price Targets

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

Insider Buying and Selling at ScanSource

In other ScanSource news, Director Charles Mathis sold 3,000 shares of ScanSource stock in a transaction on Friday, September 11th. The shares were sold at an average price of $58.00, for a total value of $174,000.00. Following the completion of the transaction, the director directly owned 25,027 shares of the company’s stock, valued at $1,451,566. This trade represents a 10.70% decrease in their position. The sale was disclosed in a filing with the SEC, which is available at this link. Also, CAO Brandy Ford sold 5,293 shares of the business’s stock in a transaction dated Friday, September 4th. The stock was 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 in the company, valued at approximately $568,959.01. This trade represents a 34.82% decrease in their ownership of the stock. The disclosure for this sale is available in the SEC filing. Insiders sold 95,632 shares of company stock worth $5,484,582 in the last ninety days. Company insiders own 3.18% of the company’s stock.

ScanSource News Roundup

Here are the key news stories impacting ScanSource this week:

• Positive Sentiment: Fiscal Q1 revenue rose 30.1% year over year to $962.3 million, topping analysts’ $860.4 million estimate. ScanSource also forecast fiscal 2027 revenue of $3.8 billion to $4.0 billion, above the roughly $3.7 billion consensus. Article: ScanSource posts better-than-expected sales and guides for strong full-year sales
• Negative Sentiment: Adjusted EPS was $0.86, missing the $1.12 consensus and down from $1.06 a year earlier. The earnings miss suggests the strong sales growth has not translated into comparable per-share earnings. Article: ScanSource shares fall after lower fiscal Q1 non-GAAP earnings miss estimates
• Negative Sentiment: Shares fell below their 200-day moving average following the disappointing results, a technical signal that may add to near-term selling pressure. Article: ScanSource shares break below 200-day moving average on disappointing earnings

ScanSource Company Profile

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.