Financial Performance - Net sales for the quarter ended September 30, 2025, were $739.65 million, a decrease of 4.6% compared to $775.58 million for the same quarter in 2024[17] - Gross profit increased to $107.47 million, up 5.7% from $101.62 million year-over-year[17] - Operating income rose to $25.90 million, representing a 47.0% increase from $17.63 million in the prior year[17] - Net income for the quarter was $19.88 million, an increase of 16.5% compared to $16.97 million in the same quarter last year[19] - Basic net income per share increased to $0.90, up from $0.70 in the prior year, reflecting a 28.6% growth[17] - Comprehensive income for the quarter was $23.61 million, compared to $20.03 million in the prior year, reflecting a 17.0% increase[19] - For the quarter ended September 30, 2025, total revenue was $739.65 million, a decrease of 4.6% compared to $775.58 million for the same quarter in 2024[46] - The net income for the quarter ended September 30, 2025, was $19.88 million, representing an increase of 17.7% from $16.97 million in the same quarter of 2024[48] - Basic earnings per share increased to $0.90 for the quarter ended September 30, 2025, compared to $0.70 for the same quarter in 2024, reflecting a growth of 28.6%[48] Assets and Liabilities - Total assets decreased to $1.72 billion as of September 30, 2025, down from $1.79 billion at June 30, 2025[14] - Total liabilities decreased to $802.94 million, down from $879.20 million at the end of the previous quarter[14] - Cash and cash equivalents at the end of the period were $124.92 million, a slight decrease from $126.16 million at the beginning of the quarter[25] - Total current assets decreased to $1.31 billion as of September 30, 2025, down from $1.37 billion at June 30, 2025[14] - The company’s total shareholders' equity increased to $914.03 million as of September 30, 2025, compared to $906.41 million at June 30, 2025[14] Cash Flow and Operating Activities - The company reported a net cash provided by operating activities of $23.21 million, down from $44.83 million in the same quarter last year[25] - Net cash provided by operating activities decreased to $23,211,000 in Q1 2025 from $44,830,000 in Q1 2024, a decline of 48.2%[25] - The company had borrowings on revolving credit amounting to $49,210,000 in Q1 2025, compared to $8,381,000 in Q1 2024, an increase of 485.5%[25] Acquisitions and Strategic Growth - The Company completed acquisitions of Resourcive and Advantix in August 2024, with a combined initial purchase price of approximately $56.7 million[108] - On October 20, 2025, the company completed the acquisition of DataXoom, adding 17 employees and enhancing its Specialty Technology Solutions segment[111] - The company continues to evaluate acquisitions on an ongoing basis, indicating a strategic focus on growth through potential mergers and acquisitions[110] - The impact of the recent acquisitions was not material to the consolidated financial statements[109] Segment Performance - The Specialty Technology Solutions segment operates primarily in the United States and Brazil, focusing on hardware, SaaS, and subscription services[87] - The Intelisys & Advisory segment provides sales and services to channel partners and end users, distributing connectivity and cloud technologies[87] - Gross profit for the Specialty Technology Solutions segment was $83.90 million, representing a gross margin of approximately 11.7%[90] - Operating income for the Specialty Technology Solutions segment increased to $20.38 million, up from $16.74 million in the prior year, reflecting a growth of 21.5%[90] Debt and Interest Rates - As of September 30, 2025, the total debt of the company was $133.913 million, a decrease of 1.7% from $136.149 million on June 30, 2025[54] - The effective interest rate for the term loan was 5.26% as of September 30, 2025, down from 5.43% on June 30, 2025[57] - The average daily outstanding balance on the revolving credit facility was $1.1 million for the quarter ended September 30, 2025, compared to $0.1 million for the same period in 2024[58] Other Financial Metrics - The effective tax rate for the quarter ended September 30, 2025, was 26.4%, slightly higher than 26.1% for the same quarter in 2024[102] - The Company reported capital expenditures of $(2.40) million for the quarter ended September 30, 2025, compared to $(2.38) million in the same quarter of 2024[90] - The company recognized $0.3 million in acquisition-related costs for the quarter ended September 30, 2025, compared to $0.4 million for the same quarter in 2024[110] - The company incurred debt issuance costs of $1.4 million in connection with the amendment and restatement of the Amended Credit Agreement[55] Currency and Derivatives - The company had net foreign exchange derivative contract losses of $655,000 for the quarter ended September 30, 2025, compared to losses of $941,000 for the same period in 2024[63] - The company had contracts outstanding for managing cash flows with notional amounts of $22.6 million for foreign currency exchange at September 30, 2025[63] - The fair value of derivative assets designated as hedges was $373,000 as of September 30, 2025, down from $680,000 as of June 30, 2025[70][72] Restructuring and Cost Management - The Company executed cost reduction and restructuring programs, resulting in accrued restructuring costs of $0.15 million as of September 30, 2025[107] - The remaining balance of accrued restructuring costs as of September 30, 2025, was $151,000[14] - In January and September 2024, the company executed cost reduction and restructuring programs, resulting in accrued restructuring costs of $0.2 million expected to be paid through Q3 FY 2026[14]

Core Viewpoint - ScanSource, Inc. is set to report its first-quarter fiscal 2026 results on November 6, with revenue estimates indicating a slight growth of 1.2% year-over-year and earnings per share expected to improve by 8% from the previous year [1]. Financial Estimates - The Zacks Consensus Estimate for revenues in the upcoming quarter is $784.85 million, reflecting a 1.2% increase from the same quarter last year [1]. - The consensus estimate for quarterly earnings is 91 cents per share, suggesting an 8% improvement compared to the year-ago quarter [1]. - The estimates for earnings and revenues have remained unchanged over the past 60 days [1]. Earnings Surprise History - ScanSource has beaten the Zacks Consensus Estimates in three of the last four quarters, with an average earnings surprise of 7.10% [2][3]. - The earnings surprise percentages for the last four quarters were 12.09%, 11.69%, -4.49%, and 9.09% respectively [3]. Segment Performance - The Specialty Technology Solutions segment is expected to report sales of $752 million, indicating stable performance compared to the previous year [7]. - The Intelisys & Advisory segment's sales are estimated at $24.4 million, representing a 5% increase from $23.3 million in the same quarter last year [9]. - The company anticipates modest revenue growth in the first half of fiscal 2026, with expectations for a stronger performance in the second half [9]. Cost Management - ScanSource has implemented cost reduction and restructuring programs, projected to yield approximately $10.5 million in annualized savings in selling, general, and administrative expenses [10]. - These ongoing cost-saving measures are expected to contribute positively to earnings for the quarter [11]. Stock Performance - Year-to-date, ScanSource's shares have declined by 10.9%, contrasting with a 0.2% growth in the industry [12].

Core Insights - ScanSource, Inc. plans to announce its first quarter fiscal year 2026 results on November 6, 2025, for the period ending September 30, 2025 [1] - An earnings conference call will be held on the same day at 10:30 a.m. ET to discuss the results [1] Company Overview - ScanSource, Inc. is a leading technology distributor focused on complex, converging technologies, and aims to accelerate growth for channel partners across various sectors including hardware, software as a service (SaaS), connectivity, and cloud [3] - The company was founded in 1992 and is headquartered in Greenville, South Carolina, employing approximately 2,600 people [3][4] - ScanSource has been recognized as one of the 2025 Best Places to Work in South Carolina and is listed on FORTUNE magazine's 2025 List of World's Most Admired Companies [3]

Core Viewpoint - SCSC has garnered investor interest due to its recent recognition as a top value stock and a positive price target set by Barclays, indicating potential for growth in its stock price [1][2][4]. Group 1: Price Target and Stock Performance - Barclays has set a price target of $43 for SCSC, suggesting a potential increase of about 3.61% from its current price of $41.50 [1][5]. - The stock's current price reflects a decrease of 2.83%, with a drop of $1.21 today [2]. - SCSC's trading activity has shown volatility, with a year range between a high of $53.90 and a low of $28.75, indicating potential for growth [3][5]. Group 2: Market Recognition - Zacks Investment Research has recognized SCSC as a top value stock, placing it on the Zacks Rank 1 (Strong Buy) list, aligning it with other notable stocks [2][4]. - The company's market capitalization is approximately $908.2 million, with a trading volume of 137,525 shares, reflecting investor interest and activity [3].

Core Viewpoint - Investors in the Industrial Services sector should consider ScanSource (SCSC) and SiteOne Landscape (SITE) as potential value opportunities, with SCSC appearing to offer superior value based on various financial metrics [1][7]. Valuation Metrics - Both SCSC and SITE have a Zacks Rank of 2 (Buy), indicating positive earnings estimate revisions and improving earnings outlooks [3]. - SCSC has a forward P/E ratio of 11.17, significantly lower than SITE's forward P/E of 39.26, suggesting SCSC is more attractively priced [5]. - The PEG ratio for SCSC is 0.74, while SITE's PEG ratio is 2.34, indicating that SCSC is expected to grow earnings at a more favorable rate relative to its price [5]. - SCSC's P/B ratio is 1.11, compared to SITE's P/B of 3.73, further supporting the argument that SCSC is undervalued relative to its book value [6]. - Based on these valuation metrics, SCSC earns a Value grade of A, while SITE receives a Value grade of C, highlighting SCSC as the better value option [6].

Core Viewpoint - Momentum investing focuses on "buying high and selling higher" rather than traditional strategies of "buying low and selling high" [1] Group 1: Momentum Investing Strategy - Momentum investors often face challenges in determining the right entry point for fast-moving stocks, which can lead to limited upside or potential downside if growth fails to justify high valuations [2] - A safer approach involves investing in bargain stocks that exhibit recent price momentum, utilizing tools like the Zacks Momentum Style Score to identify promising candidates [3] Group 2: Company Spotlight - ScanSource (SCSC) - ScanSource (SCSC) has shown a four-week price change of 3.4%, indicating growing investor interest and positioning it well within the momentum investing framework [4] - Over the past 12 weeks, SCSC's stock has gained 11.5%, with a beta of 1.43, suggesting it moves 43% more than the market in either direction [5] - SCSC has a Momentum Score of B, indicating a favorable time to invest based on momentum [6] Group 3: Earnings and Valuation - SCSC has received a Zacks Rank 2 (Buy) due to upward trends in earnings estimate revisions, which attract more investor interest and support price increases [7] - The stock is currently trading at a Price-to-Sales ratio of 0.33, suggesting it is undervalued at 33 cents for each dollar of sales, providing significant room for growth [7] Group 4: Additional Opportunities - Besides SCSC, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting further investment opportunities [8] - The Zacks Premium Screens offer over 45 different strategies tailored to various investing styles, aiding in the identification of potential winning stocks [9]

Core Insights - Investors in the Industrial Services sector may consider ScanSource (SCSC) and SiteOne Landscape (SITE) as potential stocks for investment [1] Valuation Metrics - SCSC has a Zacks Rank of 1 (Strong Buy) while SITE has a Zacks Rank of 2 (Buy), indicating a stronger earnings outlook for SCSC [3] - The forward P/E ratio for SCSC is 10.99, significantly lower than SITE's forward P/E of 40.85, suggesting SCSC is undervalued [5] - SCSC's PEG ratio is 0.73, compared to SITE's PEG ratio of 2.43, indicating SCSC has a better valuation relative to its expected earnings growth [5] - SCSC has a P/B ratio of 1.09, while SITE's P/B ratio is 3.88, further supporting SCSC's position as a more attractive value option [6] - Based on these valuation metrics, SCSC has a Value grade of A, whereas SITE has a Value grade of C, highlighting SCSC's superior value proposition [6]

Group 1 - ScanSource, Inc. (SCSC) has reached an important support level and recently experienced a "golden cross" event, indicating a potential bullish breakout [1][2] - A golden cross occurs when a stock's short-term moving average, typically the 50-day, crosses above its long-term moving average, usually the 200-day, suggesting stronger breakouts [2][3] - SCSC has rallied 7.8% over the past four weeks and currently holds a 1 (Strong Buy) rating on the Zacks Rank, indicating a strong bullish sentiment [4] Group 2 - The positive earnings outlook for SCSC further supports the bullish case, with no earnings estimates decreasing in the past two months and two revisions higher [4][6] - The Zacks Consensus Estimate for SCSC has increased, reinforcing the potential for further gains in the near future [6]

Core Viewpoint - Momentum investing focuses on "buying high and selling higher" rather than the traditional "buying low and selling high" approach, aiming for quicker profits [1] Group 1: Momentum Investing Strategy - Fast-moving trending stocks can be challenging to enter at the right time, as they may lose momentum if future growth does not justify their high valuations [2] - A safer strategy involves investing in bargain stocks that exhibit recent price momentum, utilizing tools like the Zacks Momentum Style Score to identify such opportunities [3] Group 2: Company Analysis - ScanSource (SCSC) - ScanSource (SCSC) has shown a price increase of 7.8% over the past four weeks, indicating growing investor interest [4] - Over the past 12 weeks, SCSC's stock gained 10.8%, demonstrating its ability to deliver positive returns over a longer timeframe [5] - SCSC has a Momentum Score of A, suggesting it is an opportune time to invest in the stock for maximum momentum advantage [6] - The stock has received a Zacks Rank 1 (Strong Buy) due to upward revisions in earnings estimates, which typically attract more investors [7] - SCSC is trading at a Price-to-Sales ratio of 0.32, indicating it is relatively undervalued, as investors pay only 32 cents for each dollar of sales [7] Group 3: Additional Opportunities - Besides SCSC, there are other stocks that meet the criteria of the 'Fast-Paced Momentum at a Bargain' screen, presenting further investment opportunities [8] - Investors can explore over 45 Zacks Premium Screens tailored to different investing styles to identify potential winning stocks [9]

Core Insights - ScanSource, Inc. (SCSC) reported adjusted earnings of $1.02 per share for Q4 fiscal 2025, exceeding the Zacks Consensus Estimate of 91 cents, marking a 28% increase from the previous year's earnings of 80 cents [1][8] - The company achieved net revenues of $813 million in the quarter, an 8.9% increase year-over-year, surpassing the Zacks Consensus Estimate of $773 million [2][8] - For fiscal 2026, ScanSource projects net revenues between $3.1 billion and $3.3 billion, with adjusted EBITDA expected to be between $150 million and $160 million [9] Revenue Performance - Net revenues in the United States and Canada rose by 12.2% to $745 million, while international sales decreased by 17.4% to $68.2 million [2] - Specialty Technology Solutions' revenues increased by 9.2% to $789 million in Q4 fiscal 2025, driven by growth in North America [2] Profitability Metrics - The cost of sales for Q4 was $708 million, up 9.1% year-over-year, with gross profit totaling $105 million, an 8% increase from $97 million in the prior year [4] - Adjusted EBITDA rose by 13% year-over-year to $38.6 million, with an adjusted EBITDA margin of 4.7%, slightly up from 4.6% in the previous year [5] Cash Flow and Balance Sheet - As of June 30, 2025, the company reported cash and cash equivalents of $126 million, down from $185 million a year earlier [6] - Operating activities generated $112 million in cash for fiscal 2025, a decrease from $372 million in the prior year [6] Fiscal Year Performance - For fiscal 2025, adjusted earnings per share were $3.57, compared to $3.08 in the prior year, beating the Zacks Consensus Estimate of $3.47 [7] - Total revenues for fiscal 2025 were $3.04 billion, down 6.7% year-over-year, but still exceeding the Zacks Consensus Estimate of $3.01 billion [7] Share Price Performance - The company's shares have declined by 8.7% over the past year, contrasting with an 18% growth in the industry [10]