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UPDATE: Citi Upgrades Synnex

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UPDATE: Stifel Upgrades SYNNEX Corporation As Sell-Off Appears Overdone
IBM Beats on Earnings, Revenues; Positive Outlook for 2H

In a report published Wednesday, Citi analyst Jim Suva upgrades Synnex (NYSE: SNX) to Buy from Neutral, raises target price to $72.00 from $64.00.

According to the report, the upgrade represents ~22 percent upside. The analyst's target price is based on a P/E of 11x (unchanged) but their EPS moves higher based on the accretion from the pending acquisition of IBM's CRM business which has a 10 percent EBITDA margin, well above SNX's current 2.5 percent.

“Synnex shares traded down 10% post earnings on January 9 based on concerns of margin pressure, which presents a compelling opportunity given the major transformation we see on the horizon,” the report noted. “The transformation is based on the pending acquisition of IBM's CRM business which is substantial in size ($1.2B revs, ~10% accretive to Synnex top-line) and propels the company to become a serious contender within the BPO landscape.”

SNX closed Tuesday at $61.18 with shares trading up at 2.91 percent.

Latest Ratings for SNX

DateFirmActionFromTo
Sep 2014Stifel NicolausUpgradesHoldBuy
May 2014Cross ResearchUpgradesHoldBuy
May 2014NeedhamUpgradesHoldBuy

View More Analyst Ratings for SNX
View the Latest Analyst Ratings

Posted-In: Citi Jim SuvaAnalyst Color Upgrades Analyst Ratings

 

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