Nucor earnings beat by $0.08, revenue fell short of estimates
On Monday, BofA Securities maintained a positive outlook on Ingram Micro (NYSE:INGM), reiterating a Buy rating and a $28.00 price target for the company’s stock. Currently trading at $19.31, near its 52-week low of $18.38, the stock appears undervalued according to InvestingPro analysis. BofA Securities’ endorsement follows recent virtual client meetings with Ingram Micro’s CFO, Michael Zilis, and VP of Investor Relations, Willa McManmon. During these meetings, discussions centered around the impact of tariffs on the company’s operations.
Ingram Micro, which collaborates with over 1,500 vendors, has the capability to adjust its sourcing strategies should any vendor encounter tariff-induced challenges. The management team expressed that while tariffs themselves are a pass-through issue, a potential recession triggered by tariffs would be a more significant concern. However, the company is currently witnessing robust performance in the large enterprise sector, with the small and medium-sized business (SMB) segment expected to follow suit, albeit with some delay.
The company is observing promising trends within the SMB space, where there is a greater integration of higher-margin services, contributing positively to Ingram Micro’s financial health. With annual revenue of $47.98 billion and a market capitalization of $4.53 billion, Ingram Micro maintains a modest gross profit margin of 7.18%. While pricing in the market is generally stable, certain regions like India present heightened competitive pressures. Nevertheless, Ingram Micro is experiencing growth in these areas by strategically opting out of low-margin deals. For deeper insights into Ingram Micro’s financial metrics and growth potential, InvestingPro offers comprehensive analysis and additional ProTips.
BofA Securities’ analysts are confident in Ingram Micro’s upward trajectory, citing improving trends in client and endpoint solutions, advanced solutions such as server, storage, and networking, as well as continued strength in the Cloud sector. Trading at a P/E ratio of 16.09x with projected EPS of $2.91 for FY2025, the company shows promising value potential. The firm’s price objective of $28 is derived from a 9x multiple of their calendar year 2026 EPS estimate of $3.27, indicating confidence in the company’s future earnings potential. Despite the complex market conditions, BofA Securities sees Ingram Micro as a solid investment, with no adjustments made to their earnings estimates.
In other recent news, Ingram Micro reported its fourth-quarter 2024 earnings, which exceeded analysts’ expectations with an earnings per share (EPS) of $0.92 and revenue of $13.34 billion, reflecting a 2.5% year-over-year increase. The company achieved a full-year net sales figure of $48 billion, remaining flat compared to the previous year. Despite these positive results, the company provided a cautious forecast for the first fiscal quarter, projecting revenues of $11.6 billion and EPS of $0.56 at the midpoint. BofA Securities maintained a Buy rating on Ingram Micro while adjusting the price target to $28, citing positive developments in client and endpoint solutions, advanced solutions, and cloud services. Meanwhile, Evercore ISI reduced its price target for the company to $26, maintaining an In Line rating, following the December quarter results that slightly surpassed Wall Street’s expectations. Analyst Amit Daryanani from Evercore ISI noted that competitive pressures in the Asia-Pacific and India regions, along with a product and vertical mix shift, are expected to create headwinds. Ingram Micro continues to focus on digital transformation and cloud growth, with anticipated cost reductions from restructuring initiatives. The company remains committed to sustainable top-line growth and the continued deployment of its Xvantage digital platform.
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