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SYNNEX (SNX) to Report Q4 Earnings: What's in the Offing?

Zacks Equity Research

SYNNEX Corporation SNX is slated to release fourth-quarter fiscal 2019 results on Jan 9.

For the fiscal fourth quarter, SYNNEX expects revenues in the range of $5.85-$6.15 billion. The Zacks Consensus Estimate is pegged at $6 billion, indicating 6.71% growth from the figure reported a year ago.

Non-GAAP earnings per share are projected in the band of $3.5-$3.7. The Zacks Consensus Estimate stands at $3.61, implying a 1.1% dip from the year-earlier reported number.

The company’s earnings surpassed the Zacks Consensus Estimate in each of the trailing four quarters, the average being 9.13%.

In the last reported quarter, the company delivered non-GAAP earnings of $3.3 per share, improving 31.5% from the year-ago figure and also beating the Zacks Consensus Estimate of $2.86.

Moreover, revenues of $6.2 billion topped the Zacks Consensus Estimate of $5.68 billion and increased 28.6% year over year as well.

SYNNEX Corporation Price and EPS Surprise

SYNNEX Corporation Price and EPS Surprise

SYNNEX Corporation price-eps-surprise | SYNNEX Corporation Quote

Let’s see how things are shaping up for the upcoming announcement.

Factors to Consider

SYNNEX’s fourth-quarter fiscal 2019 earnings are likely to have been driven by solid demand for its portfolio of products and services. Strong performance in all the end markets including the SMB is expected to have been a tailwind.

Growth in product areas, such as PCs, networking and cloud plus software-related solutions is likely to have boosted the Technology Solutions business.

Moreover, the company’s buyout of Covergys is expected to have been a key consistent driver. Further, new business wins, backed by the company’s widening footprint and enriched capabilities of its recent acquisition, might have been key catalysts.

However, macro issues and other hurdles in the current environment make us apprehensive.

Sequentially, Technology Solutions’ top-line growth is likely to have been a bit persistently muted compared with the previous years, mainly due to the solid progress that the company witnessed in the fiscal third quarter.

What Our Model Says

The proven Zacks model does not conclusively predict an earnings beat for SYNNEX this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates. But that’s not the case here. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

SYNNEX’s Zacks Rank #3 and an Earnings ESP of 0.00% make surprise prediction difficult.

Stocks With Favorable Combination

Here are a few stocks worth considering as our model shows that these have the right combination of elements to beat on earnings in the upcoming releases:

Synaptics Incorporated SYNA has an Earnings ESP of +0.69% and a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.

Advanced Energy Industries, Inc. AEIS has an Earnings ESP of +10.80% and is Zacks #1 Ranked.

Lumentum Holdings Inc. LITE has an Earnings ESP of +3.09% and a Zacks Rank of 2.

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