Nucor earnings beat by $0.08, revenue fell short of estimates
Investing.com - Loop Capital raised its price target on TD Synnex (NYSE:SNX) to $160 from $150 while maintaining a Buy rating following the company’s May quarter earnings report released on June 24. The new target aligns with broader analyst sentiment, as InvestingPro data shows seven analysts have recently revised earnings estimates upward, with the stock currently trading below its Fair Value.
The IT distribution company exceeded guidance with 7% year-over-year revenue growth and 10% year-over-year EPS growth, demonstrating continued strength in its core distribution business and Hyperscale segment. This performance contributed to TD Synnex’s impressive $60 billion in revenue and $8.56 in diluted earnings per share over the last twelve months.
Endpoint Solutions showed strong performance with 13% year-over-year growth in gross billings, driven by the ongoing PC refresh cycle which TD Synnex believes is in its middle stages, with further demand expected from refreshes and Windows 11 upgrades.
Advanced Solutions, excluding Hyve, grew 10% year-over-year, supported by growth in data center infrastructure, cloud, security, and AI technologies, while the Hyve segment achieved high-teen gross billings growth year-over-year.
Hyve’s ODM/CM business saw a notable 45% increase fueled by its largest customer and returning demand from its second customer, though its gross margin declined quarter-over-quarter due to foreign exchange and mix factors, with the company noting stabilizing margins and anticipating improvement. For deeper insights into TD Synnex’s financial health, valuation metrics, and growth potential, access the comprehensive Pro Research Report available exclusively on InvestingPro.
In other recent news, TD Synnex reported strong financial results for the second quarter of fiscal year 2025, significantly surpassing analysts’ expectations. The company posted non-GAAP diluted earnings per share of $2.99, exceeding the forecasted $2.71 by 10.33%, and revenue reached $14.95 billion, surpassing the anticipated $14.3 billion. UBS reiterated its buy rating on TD Synnex and raised its price target to $154.00 from $138.00 following the earnings report. UBS highlighted double-digit billings growth across both business segments, with Advanced Solutions and Endpoint billings increasing by 12% and 13%, respectively.
The company also provided a positive outlook for the third quarter, projecting non-GAAP gross billings between $21 billion and $22 billion and net revenue guidance ranging from $14.7 billion to $15.5 billion. TD Synnex expects non-GAAP diluted EPS to be between $2.75 and $3.25. UBS noted that TD Synnex’s fiscal year 2025 earnings per share might reach the high end of the company’s guidance range of $11.50 to $12.00, leading to the price target increase. The company demonstrated robust performance with a 12% year-over-year increase in gross billings to $21.6 billion, capitalizing on growth in software, PC refresh cycles, and networking markets.
Additionally, TD Synnex returned $186 million to stockholders through share repurchases and dividends. The company’s strong second-quarter performance was driven by demand across regions, including Europe, APJ, and North America, with software and advanced solutions segments showing notable growth.
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