ScanSource Inc Receives 71% Rating from Value Investor Model

ScanSource Inc (SCSC) has achieved a 71% rating under Validea's Value Investor model, based on its fundamentals and valuation. This small-cap value stock, despite some weaknesses in long-term growth, shows promise in other key financial metrics.

Date: 11-09-2024

AI Rating: 5

According to the report, ScanSource Inc (SCSC) is evaluated under Validea's Value Investor model based on Benjamin Graham's principles. The company holds a rating of 71%, which signifies decent interest in its stock. However, this rating indicates a lack of strong endorsement, as a score of 80% or above would imply more substantial interest.

In terms of sector performance, ScanSource did not pass this criterion, indicating that it may face some challenges inherent to its industry. Nevertheless, it passed tests related to sales, current ratio, long-term debt in relation to net current assets, P/E ratio, and price/book ratio. These favorable indicators suggest a solid financial standing, particularly in terms of valuation metrics.

However, the company failed the long-term earnings per share (EPS) growth criterion. This aspect could signal concerns about its future profitability potential, which might affect investor sentiment and stock prices negatively. Investors often look for companies with consistent and strong EPS growth, and a failure in this metric may detract from overall confidence in the stock.

Overall, this report reflects a mixed view of ScanSource's stock. While the company meets several of the fundamental tests of the Value Investor model, the failure in long-term EPS growth could weigh on its appeal among investors looking for robust long-term performance. Therefore, investors should weigh the positives against the negatives before making any investment decisions.

Stocks: SCSC