Barclays analyst Guy Hardwick initiated coverage of ScanSource (SCSC) with an Equal Weight rating and $43 price target The firm is positive on the company’s hybrid distribution model as it aims to drive gross profit faster than operating expense growth and improve its free cash flow conversion, the analyst tells investors in a research note, further noting that ScanSource strategy will raise EBITDA margins and deliver more predictable cash flow over time. Given ongoing competitive pressures in the agency technology services distribution market and the company’s investment in its sales force however Barclays models only a modest 10bps in improvement in FY26 EBITDA margin to 4.9%, the firm added.
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