ScanSource (SCSC) AI Stock Analysis

• Market Cap: $903.15M
• Dividend Yield: N/A
• Average Volume (3M): 151.15K
• Price to Earnings (P/E): 12.8
• Beta (1Y): 1.33
• Revenue Growth: -4.88%
• EPS Growth: 2.57%
• Country: US
• Employees: 2,300
• Sector: Technology
• Sector Strength: 88
• Industry: Technology Distributors
• EPS (TTM): 1.06
• Shares Outstanding: 21,942,503
• 10 Day Avg. Volume: 138,572
• 30 Day Avg. Volume: 151,149
• PEG Ratio: -8.49
• Price to Book (P/B): 1.08
• Price to Sales (P/S): 0.32
• P/FCF Ratio: 9.42
• Enterprise Value/Market Cap: 1.11
• Enterprise Value/Revenue: 0.33
• Enterprise Value/Gross Profit: 2.43
• Enterprise Value/Ebitda: 7.44
• 1Y Price Target: $43.00
• Price Target Upside: 5.63% Upside
• Rating Consensus: Hold
• Number of Analyst Covering: 1
• EPS Forecast (FY): 4.21
• Revenue Forecast (FY): $3.17B

• Rating: 64 Neutral
• Price Target: $43.00 ▲(5.63% Upside)

ScanSource's overall stock score reflects a stable financial position with low leverage and reasonable valuation. However, the bearish technical indicators and revenue challenges weigh on the score. The earnings call provided some positive insights, but top-line growth remains a concern.

Positive Factors

Strong Profit and Free Cash Flow Generation

The company's ability to generate strong profits and convert income into cash indicates robust financial health and operational efficiency, supporting long-term sustainability.

Intelisys & Advisory Segment Growth

Growth in the Intelisys & Advisory segment demonstrates effective market positioning and strategic focus, contributing to future revenue expansion and competitive advantage.

Successful Acquisition Strategy

Strategic acquisitions like DataXoom enhance product offerings and market reach, strengthening long-term growth prospects and competitive positioning.

Negative Factors

Decline in Specialty Technology Solutions Segment Sales

The decline in sales within a key segment indicates potential market challenges and could impact overall revenue growth if not addressed.

Top Line Revenue Challenges

Ongoing challenges in top-line revenue growth suggest market share pressures, which may hinder long-term financial performance if not mitigated.

Cash Flow Challenges

Declining free cash flow growth indicates potential issues in cash generation, which could limit investment capacity and financial flexibility over time.

ScanSource Business Overview & Revenue Model

Company Description

ScanSource, Inc. is a leading value-added distributor of technology products and services, primarily operating in the areas of automatic identification and data capture (AIDC), point-of-sale (POS) solutions, and communications equipment. The company partners with manufacturers to provide a comprehensive range of products and services that include hardware, software, and services tailored to meet the needs of resellers and their end customers across various sectors such as retail, healthcare, and logistics.

How the Company Makes Money

ScanSource generates revenue primarily through the distribution of technology products and solutions. Its revenue model is centered on purchasing products from manufacturers at wholesale prices and then reselling them to resellers and end-users at a markup. Key revenue streams include sales of hardware and accessories, software solutions, and related services such as training and technical support. The company also benefits from strong partnerships with leading manufacturers, which allows it to offer a diverse product portfolio and leverage joint marketing initiatives. Additionally, ScanSource's focus on value-added services, such as logistics and integration support, enhances its offering and contributes to recurring revenue streams, positioning it for sustainable growth in the technology distribution market.

ScanSource Financial Statement Overview

Summary

ScanSource demonstrates a stable financial structure with low leverage and moderate profitability. However, declining revenue and cash flow challenges pose risks to future growth. The company needs to focus on improving sales and cash conversion to enhance financial performance.

Income Statement

ScanSource's income statement shows a mixed performance. The gross profit margin is relatively stable at around 13.4%, indicating consistent cost management. However, the net profit margin is low at 2.35%, suggesting limited profitability. The revenue growth rate is negative, reflecting a decline in sales, which is a concern. EBIT and EBITDA margins are modest, indicating average operational efficiency.

Balance Sheet

The balance sheet reflects a stable financial position with a debt-to-equity ratio of 0.16, indicating low leverage and reduced financial risk. Return on equity is moderate at 7.88%, showing decent profitability relative to shareholder equity. The equity ratio is healthy, suggesting a strong capital structure.

Cash Flow

Cash flow analysis reveals challenges, with a significant decline in free cash flow growth at -20.79%. The operating cash flow to net income ratio is low, indicating potential issues in converting income into cash. However, the free cash flow to net income ratio is strong at 0.93, showing effective cash generation relative to net income.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	3.00B	3.04B	3.26B	3.79B	3.53B	3.15B
Gross Profit	414.50M	408.65M	399.05M	449.24M	426.52M	350.72M
EBITDA	135.17M	132.60M	140.88M	164.50M	155.06M	104.76M
Net Income	74.45M	71.55M	77.06M	89.81M	88.80M	10.79M
Balance Sheet
Total Assets	1.72B	1.79B	1.78B	2.07B	1.94B	1.67B
Cash, Cash Equivalents and Short-Term Investments	124.92M	126.16M	185.46M	36.18M	37.99M	62.72M
Total Debt	7.87M	147.11M	153.96M	343.58M	288.75M	164.01M
Total Liabilities	802.94M	879.20M	854.78M	1.16B	1.13B	940.49M
Stockholders Equity	914.03M	906.41M	924.25M	905.30M	806.53M	731.19M
Cash Flow
Free Cash Flow	82.42M	104.06M	363.09M	-45.75M	-131.20M	138.58M
Operating Cash Flow	90.73M	112.35M	371.65M	-35.77M	-124.35M	140.94M
Investing Cash Flow	-5.56M	-62.39M	9.04M	-8.26M	-3.72M	31.93M
Financing Cash Flow	-107.22M	-110.91M	-227.77M	39.53M	108.11M	-148.32M

ScanSource Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 40.71
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SCSC, the sentiment is Neutral. The current price of 40.71 is above the 20-day moving average (MA) of 40.51, below the 50-day MA of 41.88, and above the 200-day MA of 39.75, indicating a neutral trend. The MACD of -0.36 indicates Negative momentum. The RSI at 51.61 is Neutral, neither overbought nor oversold. The STOCH value of 86.17 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SCSC.

ScanSource Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
CNXN	73 Outperform	$1.47B	17.97	9.30%	1.03%	3.19%	-4.91%
SNX	68 Neutral	$12.35B	16.46	9.23%	1.16%	6.95%	19.19%
AVT	67 Neutral	$3.85B	17.63	4.71%	2.83%	-2.30%	-29.75%
SCSC	64 Neutral	$903.15M	12.83	8.11%	―	-4.88%	2.57%
ARW	64 Neutral	$5.55B	11.89	7.70%	―	3.16%	1.09%
Sector *	61 Neutral	$37.18B	12.37	-10.20%	1.83%	8.50%	-7.62%
NSIT	60 Neutral	$2.94B	22.15	8.51%	―	-6.69%	-51.74%

ScanSource Corporate Events

ScanSource, Inc. Reports Strong Q1 Earnings Growth

ScanSource, Inc. is a prominent technology distributor that specializes in providing complex, converging technologies to channel sales partners across hardware, software as a service (SaaS), connectivity, and cloud services. Based in Greenville, South Carolina, the company is recognized for its unique position in the technology distribution sector.

ScanSource Inc. Earnings Call: Profit Growth Amid Challenges

ScanSource Inc. recently held its earnings call, revealing a strong financial performance characterized by significant profit growth and strategic acquisitions. Despite facing challenges in top-line revenue growth and declines in certain segments, the company highlighted positive developments in other areas, maintaining an overall optimistic sentiment.

ScanSource Inc’s Earnings Call: Mixed Results and Optimistic Outlook

ScanSource Inc’s recent earnings call presented a mixed sentiment, reflecting both strong quarterly results and strategic advancements, alongside ongoing challenges in specific segments. The company showcased optimism for future growth, driven by strategic investments and acquisitions, despite facing competitive pressures and a decline in full-year net sales.

ScanSource, Inc. Reports Strong Q4 Results

ScanSource, Inc. is a prominent technology distributor that specializes in providing complex, converging technology solutions across hardware, software as a service (SaaS), connectivity, and cloud services. The company is headquartered in Greenville, South Carolina, and is recognized for its ability to accelerate growth for channel sales partners.