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TD SYNNEX Corporation (SNX)
NYSE:SNX
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TD SYNNEX Corporation
(NYSE:SNX)78Outperform
Positive Factors
Dividend Increase
SNX raised the dividend 10% to $0.44/share per quarter.
Market Growth
TD Synnex believes the IT market has returned to growth and that the IT spending environment should continue to improve throughout the year.
Negative Factors
Margin Pressures
Near-term margin uncertainty around the Hyve business and uneven end market recovery.
TD SYNNEX Corporation (SNX) vs. S&P 500 (SPY)
Market Cap
$11.22B
Dividend Yield1.23%
Average Volume (3M)553.66K
Price to Earnings (P/E)16.7
Beta (1Y)0.98
Revenue Growth1.56%
EPS Growth18.79%
CountryUS
Employees23,000
SectorTechnology
Sector Strength48
IndustryHardware & Equipment
Share Statistics
EPS (TTM)7.96
Shares Outstanding84,369,310
10 Day Avg. Volume520,000
30 Day Avg. Volume553,658
Financial Highlights & Ratios
PEG Ratio0.89
Price to Book (P/B)N/A
Price to Sales (P/S)0.19
Price to Cash Flow (P/CF)4.90
P/FCF Ratio4.90
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$150.50Price Target Upside16.38% Upside
Rating ConsensusStrong Buy
Number of Analyst Covering6
TD SYNNEX Corporation Business Overview & Revenue Model
Company DescriptionTD SYNNEX Corporation is a leading global distributor and solutions aggregator for the IT ecosystem. It operates in the technology sector, providing a wide array of products and services, including IT distribution, logistics, and integration services. The company serves a broad range of industries, offering solutions in data center, cloud, cybersecurity, big data, analytics, and IoT, catering to both small businesses and large enterprises.
How the Company Makes MoneyTD SYNNEX Corporation generates revenue primarily through its extensive distribution network, which facilitates the sale of technology products from major manufacturers and vendors to resellers, systems integrators, and service providers. The company earns money by purchasing IT products at wholesale prices and selling them to customers at a markup. Additionally, TD SYNNEX provides value-added services such as logistics, integration, and supply chain management, which contribute to its earnings. The company also leverages strategic partnerships with leading technology firms to enhance its product offerings and expand its market reach, further driving revenue.
TD SYNNEX Corporation Financial Statement Overview
Summary
TD SYNNEX Corporation demonstrates strong financial health with consistent revenue growth, efficient operations, and a solid balance sheet featuring low leverage. Profitability metrics are stable, but there is a need to enhance cash flow generation to maintain growth momentum.Income Statement
TD SYNNEX Corporation has demonstrated consistent revenue growth with a 1.56% increase in Total Revenue in TTM (Trailing-Twelve-Months) compared to the previous year. The Gross Profit Margin stands at 6.45%, and the Net Profit Margin is 1.18%, indicating moderate profitability. The EBIT Margin is 2.15%, and the EBITDA Margin is 2.57%. These margins reflect stable operating efficiency despite competitive industry pressures.85
Very Positive
Balance Sheet
The company maintains a solid financial position with a Debt-to-Equity Ratio of 0.02, indicating low leverage and prudent financial management. The Return on Equity (ROE) is 8.57%, showcasing decent shareholder returns. The Equity Ratio is 26.54%, suggesting a strong equity base relative to total assets, which contributes to financial stability.80
Positive
Cash Flow
TD SYNNEX Corporation's Free Cash Flow is robust, with a positive growth trajectory evident from a Free Cash Flow of $1,042,612,000 in TTM. The Operating Cash Flow to Net Income Ratio is 1.77, signifying effective cash generation relative to net earnings. However, there has been a decrease in Free Cash Flow compared to the previous year, indicating potential challenges in maintaining cash generation momentum.78
Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 58.45B | 57.56B | 62.34B | 31.61B | 19.98B | Gross Profit |
| 3.98B | 3.96B | 3.90B | 1.89B | 1.19B | EBIT |
| 1.19B | 1.08B | 808.66M | 623.22M | 521.34M | EBITDA |
| 1.19B | 1.51B | 1.49B | 731.90M | 593.83M | Net Income Common Stockholders |
| 689.09M | 626.91M | 651.31M | 395.07M | 334.54M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 1.06B | 1.03B | 522.60M | 993.97M | 1.41B | Total Assets |
| 30.27B | 29.41B | 29.73B | 27.67B | 13.47B | Total Debt |
| 171.09M | 4.08B | 4.10B | 4.14B | 1.62B | Net Debt |
| -888.29M | 3.05B | 3.58B | 3.14B | 209.64M | Total Liabilities |
| 22.24B | 21.23B | 21.71B | 19.76B | 9.13B | Stockholders Equity |
| 8.04B | 8.18B | 8.03B | 7.91B | 4.34B |
| Cash Flow | Free Cash Flow | |||
| 1.04B | 1.26B | -166.65M | 754.89M | 1.64B | Operating Cash Flow |
| 1.22B | 1.41B | -49.60M | 809.79M | 1.83B | Investing Cash Flow |
| -193.84M | -156.41M | -115.51M | -952.35M | -209.50M | Financing Cash Flow |
| -953.10M | -785.88M | -275.59M | -392.62M | -291.70M |
TD SYNNEX Corporation Technical Analysis
Neutral
129.32
Price Trends
134.81
Negative
127.30
Positive
122.82
Positive
Market Momentum
-1.64
Positive
28.88
Positive
11.94
Positive
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SNX, the sentiment is Neutral. The current price of 129.32 is below the 20-day moving average (MA) of 139.27, below the 50-day MA of 134.81, and above the 200-day MA of 122.82, indicating a neutral trend. The MACD of -1.64 indicates Positive momentum. The RSI at 28.88 is Positive, neither overbought nor oversold. The STOCH value of 11.94 is Positive, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for SNX.
TD SYNNEX Corporation Risk Analysis
TD SYNNEX Corporation disclosed 36 risk factors in its most recent earnings report. TD SYNNEX Corporation reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
TD SYNNEX Corporation Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
78 Outperform | $11.22B | 16.72 | 8.42% | 1.23% | 1.56% | 18.79% | |
73 Outperform | $4.92B | 23.42 | 14.24% | ― | -5.17% | -9.73% | |
68 Neutral | $4.25B | 13.93 | 6.45% | 2.60% | -12.21% | -51.31% | |
66 Neutral | $5.52B | 15.03 | 6.78% | ― | -15.66% | -54.03% | |
64 Neutral | $1.71B | 16.37 | 11.39% | ― | -2.22% | -17.25% | |
64 Neutral | $859.23M | 14.46 | 6.79% | ― | -15.92% | -25.15% | |
59 Neutral | $22.39B | 11.53 | -18.05% | 2.31% | 5.00% | -25.89% |
* Technology Sector Average
Performance Comparison
SNX
TD SYNNEX Corporation
129.32
26.38
25.63%
ARW
Arrow Electronics
109.34
-11.53
-9.54%
AVT
Avnet
50.44
4.71
10.30%
PLUS
Eplus
65.58
-16.18
-19.79%
NSIT
Insight Enterprises
156.31
-30.01
-16.11%
SCSC
ScanSource
36.72
-6.10
-14.25%
TD SYNNEX Corporation Earnings Call Summary
Earnings Call Date: Jan 10, 2025 | % Change Since: 6.24% | Next Earnings Date: Mar 27, 2025
Earnings Call Sentiment Neutral
The earnings call highlighted strong revenue growth and successful global expansion, particularly in Asia Pacific, as well as increased dividends. However, challenges such as declining operating margins and macroeconomic uncertainties in Europe were noted. The overall sentiment is cautiously optimistic, with a focus on future growth opportunities.Highlights
Strong Revenue and Gross Billings Growth
Revenue increased by 10% year-over-year, and gross billings grew by 7%, exceeding expectations. The company generated $1 billion in free cash flow for the fiscal year.
Hyve Segment Growth
Hyve revenue grew by double digits in Q4, attributed to its improved end-to-end capabilities and increased cloud adoption.
Dividend Increase
The Board of Directors approved a 10% increase to the cash dividend, reflecting confidence in the company's financial position.
Global Expansion Success
TD SYNNEX expanded its vendor relationships in key markets like India and Japan, growing gross billings by 31% year-over-year in Asia Pacific.
Lowlights
Operating Margins Decline
There was a 25 basis point decline in gross profit year-over-year, driven by a tough comparison with last year's elevated margins in the Hyve segment.
Higher Interest Expenses
Interest expenses were higher than expected at $86 million, due to increased average borrowings.
Macro Uncertainty in Europe
The European market faced uncertainty due to political instability and macroeconomic factors, which could impact growth.
Company Guidance
During the TD SYNNEX Q4 2024 earnings call, the company reported a 10% year-over-year revenue growth and a 7% growth in gross billings. They generated $513 million in free cash flow for Q4, reaching their $1 billion target for the full fiscal year. The company returned 72% of their annual free cash flow through buybacks and dividends. Gross billings in endpoint solutions increased by 3%, while their cloud, cybersecurity, and data analytics portfolios grew by double digits across all geographic segments. The Hyve segment demonstrated strong revenue growth, although it impacted operating margins due to a tough year-over-year comparison. For fiscal year 2025, TD SYNNEX expects gross billings to grow in the mid-single digits, with a free cash flow target of approximately $1.1 billion.TD SYNNEX Corporation Corporate Events
Executive/Board ChangesShareholder Meetings
TD SYNNEX Announces Board Member Hau Lee’s Retirement
Neutral
Jan 15, 2025
On January 8, 2025, TD SYNNEX Corporation announced that Hau Lee will retire from its Board of Directors at the expiration of his current term, effective at the company’s 2025 Annual Meeting of Stockholders. Lee, a member of the board since 2012, has been praised for his leadership and contributions to the company’s success. The meeting is scheduled for April 2, 2025, in Greenville, South Carolina, where shareholders of record as of February 3, 2025, will be able to vote on matters at the meeting.
Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.