Synnex Shares Plunged: What You Need to Know
Although we don't believe in timing the market or panicking over market movements, we do like to keep an eye on big changes -- just in case they're material to our investing thesis.
What: Shares of Synnex (NYS: SNX) plunged today by as much as 16% after the company reported earnings yesterday.
So what: First-quarter results ended up somewhat mixed, with revenue of $2.46 billion falling short of expectations, while earnings per share of $1.02 came in topping the Street's estimates. The devil in the details was second-quarter guidance, which failed to impress.
Now what: The company expects second-quarter revenue to be between $2.45 billion and $2.55 billion, giving way to earnings per share in the range of $0.87 and $0.91. Even the upper limits of those ranges fall short of the $2.6 billion and $0.95-per-share respective consensus estimates. Synnex said some of the softness was related to a transition to a fee-for-service basis. On the flip side, Citigroup analyst Richard Gardner said that only explains some of the lackluster forecast, which must mean that the company is facing weak demand in its retail division.
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At the time this article was published Fool contributorEvan Niuholds no position in any company mentioned. Check out hisholdings and a short bio. The Motley Fool has adisclosure policy. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. Try any of our Foolish newsletter servicesfree for 30 days.
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