Assessing SYNNEX Corporation’s (NYSE:SNX) performance as a company requires looking at more than just a years’ earnings data. Below, I will run you through a simple sense check to build perspective on how SYNNEX is doing by comparing its most recent earnings with its historical trend, in addition to the performance of its electronic industry peers. Check out our latest analysis for SYNNEX

How SNX fared against its long-term earnings performance and its industry

For the purpose of this commentary, I like to use the ‘latest twelve-month’ data, which either annualizes the most recent 6-month earnings update, or in some cases, the most recent annual report is already the latest available financial data. This method enables me to examine different companies in a uniform manner using the latest information. SYNNEX’s latest twelve-month earnings is $292.6M, which, relative to last year’s figure, has increased by 39.65%. Given that these values are fairly short-term thinking, I have calculated an annualized five-year figure for SYNNEX’s net income, which stands at $180.4M. This means that, generally, SYNNEX has been able to gradually grow its earnings over the last few years as well.

How has it been able to do this? Let’s take a look at if it is solely due to an industry uplift, or if SYNNEX has experienced some company-specific growth. Over the past couple of years, SYNNEX expanded its bottom line faster than revenue by successfully controlling its costs. This has led to a margin expansion and profitability over time. Looking at growth from a sector-level, the US electronic industry has been growing its average earnings by double-digit 22.40% in the previous year, and 10.46% over the previous few years. This means that any uplift the industry is enjoying, SYNNEX is capable of amplifying this to its advantage.

What does this mean?

SYNNEX’s track record can be a valuable insight into its earnings performance, but it certainly doesn’t tell the whole story. While SYNNEX has a good historical track record with positive growth and profitability, there’s no certainty that this will extrapolate into the future. You should continue to research SYNNEX to get a better picture of the stock by looking at:

1. Future Outlook: What are well-informed industry analysts predicting for SNX’s future growth? Take a look at our free research report of analyst consensus for SNX’s outlook.

2. Financial Health: Is SNX’s operations financially sustainable? Balance sheets can be hard to analyze, which is why we’ve done it for you. Check out our financial health checks here.

3. Other High-Performing Stocks: Are there other stocks that provide better prospects with proven track records? Explore our free list of these great stocks here.

NB: Figures in this article are calculated using data from the last twelve months, which refer to the 12-month period ending on the last date of the month the financial statement is dated. This may not be consistent with full year annual report figures.
To help readers see pass the short term volatility of the financial market, we aim to bring you a long-term focused research analysis purely driven by fundamental data. Note that our analysis does not factor in the latest price sensitive company announcements.

The author is an independent contributor and at the time of publication had no position in the stocks mentioned.