Research Desk Line-up: Cognizant Technology Solutions Post Earnings Coverage
LONDON, UK / ACCESSWIRE / June 5, 2017 / Pro-Trader Daily takes a look at the latest corporate events and news making the headlines for The Descartes Systems Group Inc. (NASDAQ: DSGX). The Company announced on June 02, 2017, that it has acquired substantially all the assets of the business of PCSTrac, Inc., including certain related assets of Progressive Computer Services, Inc., or PCS Technologies, for about $11.25 million in an all-cash transaction. Descartes is a global leader in providing on-demand, software-as-a-service solutions focused in logistics-intensive business via the Global Logistics Network. For immediate access to our complimentary reports, including today's coverage, register for free now at:
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PCSTrac, headquartered in Philadelphia, Pennsylvania, helps specialty retailers and their specific logistics service providers, attain a collaboration to improve carton-level visibility for shipments from distribution centers to stores. PCSTrac's solutions enhance visibility and insight into the store replenishment supply chain while helping increase sales. The solutions from the Company enhance loss prevention and improve inventory control for retailers. The portfolio of PCSTrac is beneficial to logistics service providers as it allows them to improve efficiencies and customer service levels with solutions that are pre-configured to match each retailer's delivery compliance specifications.
Descartes finds the PCSTrac portfolio complementary to its Be aware platform, where PCSTrac also supports pool distribution, enabling the retailers to reduce logistics costs and minimize store disruptions by removing unconsolidated shipments from suppliers and retailer distribution centers. The Company acquired Bearware Inc., a leading US-based provider of mobile solutions, on July 22, 2015. The purchase price for the acquisition was about $11.25 million in an all-cash transaction.
Pool Distribution Issue
Pool distribution is one of the most popular strategies to lower distribution costs, increase the delivery frequency and eventually improve overall replenishment performance. The strategy is leveraged by a constantly growing community of retailers and pool carriers who expect to minimize their operational costs and logistics expenses. Effective pool distribution requires a unified technology solution that enables standardization of the process and offers a carton-level visibility across the entire store replenishment lifecycle.
Descartes expects this transaction to be accretive to its pool distribution, whereby combining two market leaders in carton-level tracking and pool distribution with the Global Logistics Network, it aims to bring increased efficiencies to both retailers and logistics service providers.
Descartes, based in Waterloo, Canada, has been executing an all-round growth strategy while expecting to dominate the intensive-logistics industry. Under its growth prospects, the Company acquired ShipRush on May 19, 2017.
ShipRush is a leading provider of ecommerce multi-carrier parcel shipping solutions for small-to medium-sized businesses, where it helps SMBs and omnichannel retailers execute parcel shipments for last-mile delivery to customers. Descartes acquired ShipRush for an up-front consideration of about $14.0 million, paid with cash on hand, plus potential performance-based consideration. The maximum amount payable under the all-cash performance-based earn-out was $3 million and was subject to ShipRush achieving revenue-based targets in the first two years, post the completion of the acquisition.
Descartes recently announced on May 31, 2017, its Q1 FY18 results for the period ending April 30, 2017. The Company reported net revenues of $54.5 million for Q1 FY18, up from $48.9 million for Q1 FY17. The net income for the period ending April 30, 2017, stood at $6.9 million up from $6 million in Q1 FY17.
Last Close Stock Review
At the closing bell, on Friday, June 02, 2017, The Descartes Systems Group's stock was marginally down by 0.80%, ending the trading session at $24.85. A total volume of 69.96 thousand shares have exchanged hands, which was higher than the 3-month average volume of 49.49 thousand shares. The Company's stock price surged 15.05% in the last three months, 12.19% in the past six months, and 19.87% in the previous twelve months. Moreover, the stock rallied 16.12% since the start of the year. The stock is trading at a PE ratio of 77.17 and currently has a market cap of $1.91 billion.
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