TD Synnex Upgraded to Overweight by J.P. Morgan
Written by Emily J. Thompson, Senior Investment Analyst
Updated: Sep 01 2023
0mins
TD Synnex Corp's stock rose by 3.00% and reached a 52-week high amid a broader market decline, with the Nasdaq-100 down 0.36% and the S&P 500 down 0.15%.
The increase in TD Synnex's stock price is attributed to J.P. Morgan upgrading the company from Neutral to Overweight, reflecting optimism about rising enterprise demand for IT infrastructure upgrades. Analysts have set a price target of $298 for TD Synnex, indicating confidence in its future growth potential, particularly in AI readiness and device refreshes.
This upgrade comes at a time when enterprise customers are expected to maintain robust orders, which could lead to sustained demand for TD Synnex's services. The positive outlook from analysts suggests that the company is well-positioned to capitalize on the ongoing trends in the IT sector.
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Analyst Views on SNX
Wall Street analysts forecast SNX stock price to fall
6 Analyst Rating
5 Buy
1 Hold
0 Sell
Strong Buy
Current: 238.920
Low
163.00
Averages
178.33
High
193.00
Current: 238.920
Low
163.00
Averages
178.33
High
193.00
About SNX
TD Synnex Corporation is a global distributor and solutions aggregator and original design and contract manufacturer for the information technology (IT) ecosystem. The Company's two primary solution portfolios include Endpoint Solutions and Advanced Solutions. The Endpoint Solutions portfolio primarily includes personal computing devices and peripherals, mobile phones and accessories, printers and supplies. The Advanced Solutions portfolio includes data center technologies, such as hybrid cloud, security, storage, networking, servers, software, converged and hyper-converged infrastructure. The Company's Hyve Solutions business partners with technology companies to design, manufacture, and deliver traditional and accelerated compute, cloud, and connected infrastructure. It serves customers such as value-added resellers, independent software vendors, corporate resellers, government resellers, system integrators, direct marketers, retailers and managed service providers.
About the author
Emily J. Thompson
Emily J. Thompson, a Chartered Financial Analyst (CFA) with 12 years in investment research, graduated with honors from the Wharton School. Specializing in industrial and technology stocks, she provides in-depth analysis for Intellectia’s earnings and market brief reports.
July Trading Outlook: Opportunities for Investors
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- Strong Performance: TD Synnex delivered robust fiscal Q2 results, driven by accelerating growth in Hyve and market share gains, demonstrating the company's ability to expand in a competitive landscape.
- Market Share Gains: Through effective market strategies, TD Synnex successfully captured additional market share, further solidifying its leadership position in the industry, which is expected to positively impact future revenue growth.
- Hyve Acceleration: The accelerated growth of Hyve not only boosted overall performance but also indicates that the company's strategic positioning in digital transformation and cloud services is yielding significant results, enhancing customer loyalty.
- Optimistic Outlook: Based on the current growth momentum and market demand, TD Synnex maintains an optimistic outlook for future performance, anticipating continued benefits from technological innovations and market expansion opportunities.
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- Record Gross Billings: TD Synnex reported non-GAAP gross billings of $28.9 billion in Q2, a 33% year-over-year increase, reflecting robust performance across both Distribution and Hyve segments, thereby solidifying its market leadership.
- Hyve Business Surge: Hyve's non-GAAP gross billings soared to $5.5 billion, up 117% year-over-year, primarily driven by new programs with existing customers, indicating strategic success in high-growth areas.
- Significant Shareholder Returns: The company returned $112 million to shareholders through repurchases and $39 million in dividends, with a dividend of $0.48 per share, demonstrating a commitment to shareholder value amid strong financial performance.
- Optimistic Future Guidance: The company projects Q3 Fiscal 2026 revenue of approximately $18.6 billion and non-GAAP EPS of around $4.50, reflecting confidence in future growth despite challenges from rising component costs and supply chain constraints.
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TD SYNNEX Reports Record Q2 Earnings Driven by Distribution and AI Growth
- Strong Financial Performance: TD SYNNEX achieved non-GAAP gross billings of $23.4 billion in Q2 2026, a 22% year-over-year increase, reflecting robust growth in its distribution business and solidifying its market leadership.
- Hyve Business Surge: The Hyve segment reported non-GAAP gross billings of $5.5 billion, up 117% year-over-year, indicating significant market share gains in the rapidly growing AI sector, which enhances overall profitability.
- Strategic Partnership: HPE selected TD SYNNEX as one of its global distribution partners for its full networking, cloud, and AI portfolio, highlighting the company's critical role in the industry and its potential for future growth.
- Expansion Plans: The company is expanding its manufacturing facilities by over 1 million square feet to meet future customer demands, a move that will enhance production capacity and support long-term growth strategies.
See More
TD SYNNEX Declares Quarterly Dividend of $0.48
- Quarterly Dividend Declaration: TD SYNNEX has declared a quarterly dividend of $0.48 per share, consistent with previous distributions, indicating the company's stable cash flow and profitability, which is likely to attract more investor interest.
- Dividend Yield: The forward yield of 0.68% reflects the company's robust performance in the current market environment, potentially enhancing shareholder confidence and supporting stock price appreciation.
- Payment Schedule: The dividend is payable on July 31, with a record date of July 17 and an ex-dividend date also on July 17, providing shareholders with a clear timeline that aids in financial planning.
- Performance Outlook: TD SYNNEX expects strong growth in earnings per share moving forward, coupled with a 31% year-over-year revenue increase in Q2, indicating the company's competitive position and growth potential in the market.
See More
TD Synnex Reports Strong Q2 Results, Exceeds Expectations
- Significant Revenue Growth: TD Synnex reported a 31% year-over-year revenue increase to $19.58 billion in Q2, surpassing market expectations by nearly $2.8 billion, which reinforces its leadership position in the technology distribution sector.
- Enhanced Profitability: The adjusted earnings per share reached $4.85, exceeding the $4.14 estimate, reflecting the company's success in cost control and operational efficiency, thereby boosting investor confidence.
- Optimistic Outlook: The company anticipates third-quarter revenue between $18.2 billion and $19 billion, significantly above the $16.7 billion estimate, indicating ongoing business growth potential.
- Shareholder Returns: TD Synnex announced a quarterly cash dividend of $0.48 per share, enhancing shareholder returns, while the stock has surged 88% year-to-date, demonstrating strong market performance.
See More
July Trading Outlook: Opportunities for Investors
- Profitability Analysis: Micron Technology (MU) boasts a net profit margin of 55.9% over the past 12 months, with an expected earnings growth rate of 791% this year, highlighting its strong performance in the memory and storage sector, making it a focal point for investors.
- Market Outlook: Credo Technology (CRDO) shows a net profit margin of 35.4% and an anticipated earnings growth rate of 72.8%, providing high-speed Ethernet and PCIe solutions, indicating its competitive edge in the global market and potential as a preferred investment.
- Industry Comparison: TD SYNNEX (SNX) has a lower net profit margin of 1.6%, yet its expected earnings growth rate of 43.1% in the IT distribution and solutions aggregation space remains noteworthy, suggesting potential growth opportunities.
- Investment Strategy: By utilizing Zacks Rank #1 screening alongside sales and net income growth metrics from the past 12 months, investors can narrow down from over 7,685 stocks to 14 high-quality picks, showcasing strong market performance potential.
See More
TD Synnex Reports Strong Fiscal Q2 Driven by Hyve Growth
- Strong Performance: TD Synnex delivered robust fiscal Q2 results, driven by accelerating growth in Hyve and market share gains, demonstrating the company's ability to expand in a competitive landscape.
- Market Share Gains: Through effective market strategies, TD Synnex successfully captured additional market share, further solidifying its leadership position in the industry, which is expected to positively impact future revenue growth.
- Hyve Acceleration: The accelerated growth of Hyve not only boosted overall performance but also indicates that the company's strategic positioning in digital transformation and cloud services is yielding significant results, enhancing customer loyalty.
- Optimistic Outlook: Based on the current growth momentum and market demand, TD Synnex maintains an optimistic outlook for future performance, anticipating continued benefits from technological innovations and market expansion opportunities.
See More
TD Synnex Reports Record Q2 Earnings with Strong Growth Metrics
- Record Gross Billings: TD Synnex reported non-GAAP gross billings of $28.9 billion in Q2, a 33% year-over-year increase, reflecting robust performance across both Distribution and Hyve segments, thereby solidifying its market leadership.
- Hyve Business Surge: Hyve's non-GAAP gross billings soared to $5.5 billion, up 117% year-over-year, primarily driven by new programs with existing customers, indicating strategic success in high-growth areas.
- Significant Shareholder Returns: The company returned $112 million to shareholders through repurchases and $39 million in dividends, with a dividend of $0.48 per share, demonstrating a commitment to shareholder value amid strong financial performance.
- Optimistic Future Guidance: The company projects Q3 Fiscal 2026 revenue of approximately $18.6 billion and non-GAAP EPS of around $4.50, reflecting confidence in future growth despite challenges from rising component costs and supply chain constraints.
See More
TD SYNNEX Reports Record Q2 Earnings Driven by Distribution and AI Growth
- Strong Financial Performance: TD SYNNEX achieved non-GAAP gross billings of $23.4 billion in Q2 2026, a 22% year-over-year increase, reflecting robust growth in its distribution business and solidifying its market leadership.
- Hyve Business Surge: The Hyve segment reported non-GAAP gross billings of $5.5 billion, up 117% year-over-year, indicating significant market share gains in the rapidly growing AI sector, which enhances overall profitability.
- Strategic Partnership: HPE selected TD SYNNEX as one of its global distribution partners for its full networking, cloud, and AI portfolio, highlighting the company's critical role in the industry and its potential for future growth.
- Expansion Plans: The company is expanding its manufacturing facilities by over 1 million square feet to meet future customer demands, a move that will enhance production capacity and support long-term growth strategies.
See More
TD SYNNEX Declares Quarterly Dividend of $0.48
- Quarterly Dividend Declaration: TD SYNNEX has declared a quarterly dividend of $0.48 per share, consistent with previous distributions, indicating the company's stable cash flow and profitability, which is likely to attract more investor interest.
- Dividend Yield: The forward yield of 0.68% reflects the company's robust performance in the current market environment, potentially enhancing shareholder confidence and supporting stock price appreciation.
- Payment Schedule: The dividend is payable on July 31, with a record date of July 17 and an ex-dividend date also on July 17, providing shareholders with a clear timeline that aids in financial planning.
- Performance Outlook: TD SYNNEX expects strong growth in earnings per share moving forward, coupled with a 31% year-over-year revenue increase in Q2, indicating the company's competitive position and growth potential in the market.
See More
TD Synnex Reports Strong Q2 Results, Exceeds Expectations
- Significant Revenue Growth: TD Synnex reported a 31% year-over-year revenue increase to $19.58 billion in Q2, surpassing market expectations by nearly $2.8 billion, which reinforces its leadership position in the technology distribution sector.
- Enhanced Profitability: The adjusted earnings per share reached $4.85, exceeding the $4.14 estimate, reflecting the company's success in cost control and operational efficiency, thereby boosting investor confidence.
- Optimistic Outlook: The company anticipates third-quarter revenue between $18.2 billion and $19 billion, significantly above the $16.7 billion estimate, indicating ongoing business growth potential.
- Shareholder Returns: TD Synnex announced a quarterly cash dividend of $0.48 per share, enhancing shareholder returns, while the stock has surged 88% year-to-date, demonstrating strong market performance.
See More
