Tech Data Earnings Preview

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Tech Data (NAS: TECD) came in under analysts' estimates last quarter, but have a chance to fix things this quarter. The company will unveil its latest earnings on Thursday, August 18. Tech Data is a distributor of information technology products, logistics management, and other value-added services worldwide.

What analysts say:

  • Buy, sell, or hold?: Half of analysts think investors should stand pat on Tech Data while the remaining half rate the stock as a buy. Analysts don't like Tech Data as much as competitor Ingram Micro overall. Five out of nine analysts rate Ingram Micro a buy compared to three of six for Tech Data. Analysts still rate the stock a hold, but they are a bit more wary about it compared to three months ago.
  • Revenue Forecasts: On average, analysts predict $6.13 billion in revenue this quarter. That would represent a rise of 12.1% from the year-ago quarter.
  • Wall Street Earnings Expectations: The average analyst estimate is earnings of $0.95 per share. Estimates range from $0.88 to $1.

What our community says:
CAPS All Stars are solidly behind the stock, with 88.2% giving it an "outperform" rating. The community at large backs the All Stars, with 88.7% assigning it a rating of "outperform." Fools are bullish on Tech Data, though the message boards have been quiet lately with only 53 posts in the past 30 days. Despite the majority sentiment in favor of Tech Data, the stock has a middling CAPS rating of three out of five stars.

Management:
Tech Data's profit has risen year over year by an average of 12.5% over the past five quarters. Revenue has now gone up for three straight quarters.

Now let's look at how efficient management is at running the business. Traditionally, margins represent the efficiency with which companies capture portions of sales dollars. The following table shows gross, operating, and net margins over the past four quarters:

Quarter

Q1

Q4

Q3

Q2

Gross Margin

5.3%

5.3%

5.3%

5.3%

Operating Margin

1.2%

1.7%

1.3%

1.2%

Net Margin

0.8%

1.1%

0.8%

0.7%

One final thing: If you want to keep tabs on Tech Data movements, and for more analysis on the company, make sure you add it to your Watchlist.

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At the time this article was published

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