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Tech Data (TECD) Gains But Lags Market: What You Should Know

Zacks Equity Research

In the latest trading session, Tech Data (TECD) closed at $129.10, marking a +0.01% move from the previous day. This change lagged the S&P 500's 0.75% gain on the day. Meanwhile, the Dow gained 0.69%, and the Nasdaq, a tech-heavy index, added 1.32%.

Coming into today, shares of the information technology products distributor had gained 5.54% in the past month. In that same time, the Retail-Wholesale sector gained 0.59%, while the S&P 500 gained 3.42%.

TECD will be looking to display strength as it nears its next earnings release. On that day, TECD is projected to report earnings of $3.01 per share, which would represent a year-over-year decline of 0.33%. Meanwhile, our latest consensus estimate is calling for revenue of $9.34 billion, up 0.03% from the prior-year quarter.

TECD's full-year Zacks Consensus Estimates are calling for earnings of $12.50 per share and revenue of $37.33 billion. These results would represent year-over-year changes of +9.84% and +0.23%, respectively.

Investors might also notice recent changes to analyst estimates for TECD. These revisions typically reflect the latest short-term business trends, which can change frequently. With this in mind, we can consider positive estimate revisions a sign of optimism about the company's business outlook.

Our research shows that these estimate changes are directly correlated with near-term stock prices. We developed the Zacks Rank to capitalize on this phenomenon. Our system takes these estimate changes into account and delivers a clear, actionable rating model.

The Zacks Rank system, which ranges from #1 (Strong Buy) to #5 (Strong Sell), has an impressive outside-audited track record of outperformance, with #1 stocks generating an average annual return of +25% since 1988. Within the past 30 days, our consensus EPS projection has moved 0.31% higher. TECD is holding a Zacks Rank of #4 (Sell) right now.

In terms of valuation, TECD is currently trading at a Forward P/E ratio of 10.36. For comparison, its industry has an average Forward P/E of 13.28, which means TECD is trading at a discount to the group.

The Retail - Computer Hardware industry is part of the Retail-Wholesale sector. This group has a Zacks Industry Rank of 16, putting it in the top 7% of all 250+ industries.

The Zacks Industry Rank gauges the strength of our individual industry groups by measuring the average Zacks Rank of the individual stocks within the groups. Our research shows that the top 50% rated industries outperform the bottom half by a factor of 2 to 1.

You can find more information on all of these metrics, and much more, on Zacks.com.

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