Synnex Gets A Price Target Boost From Brean Capital

SYNNEX Corporation SNX reported its May quarter revenue and EPS results and August quarter guidance ahead of expectations. Brean Capital’s Ananda Baruah maintained a Buy rating for the company, while raising the price target from $97 to $108. Terming SYNNEX as a “classically strong operational company,” the analyst recommended to buy dips and pullbacks.

May Quarter Results

SYNNEX reported its revenue and EPS at $3.4B and $1.37, ahead of the Street expectations of $3.3B and $1.35, respectively. Revenue growth came in at 3.9 percent y/y.

August Quarter Guidance

Management guided to revenue and EPS at $3.40B - $3.53B and $1.52 - $1.57, versus Street expectations of $3.40B and $1.53, respectively. The guidance reflects 2-6 percent y/y revenue growth and 7 percent y/y EPS growth.

“Management believes that IT spending appears to be seasonal across the board with the expectations of a solid Canada market, a steady U.S. business environment, and a stabilizing Japan,” analyst Ananda Baruah wrote.

Although execution seems to be getting back on track into the back half of the year, shares had already appreciated and near-term gains could be capped, Baruah commented.