This business services process provider beat analysts’ estimates by $0.11 last quarter, and with its recent acquisition, earnings should continue their upward track.
SYNNEX Corporation (SNX)
From AlphaProfit Sector Investors’ Newsletter
Business process services company SYNNEX Corporation (SNX) brought call center operator Convergys into its fold on October 5, for $2.8 billion. This deal should diversify SYNNEX’s revenues and increase its annual sales by about $2.7 billion. SYNNEX’s profit margin should also benefit from Convergys’ higher margined business. SYNNEX expects the purchase to add to EPS immediately. It also expects cost synergies to exceed $50 million in the first 12 months.
SYNNEX shares appeal to risk-tolerant value investors. They trade at 7.1XEPS versus prospects for 13% EPS growth in the next 12 months. (Next earnings: ~ Jan. 9, 2019)
Sam Subramanian, PhD, AlphaProfit Sector Investors’ Newsletter, www.alphaprofit.com, 281-565-6963, November 2018