Tech Data’s stock hit an all-time high on Wednesday after earnings. What does this tell you about the broad technology and IT sector if it is among the top technology distributors in the world and if its stock hit an all-time high after earnings?
The company reported $8.0 billion in quarterly revenue, up 7 percent from $7.4 billion in the prior-year quarter. Sales would have increased approximately 5 percent from the year-ago quarter had it not been for strengthening currency trends.
Tech Data earned $2.10 per share on an adjusted basis, up from $1.53 per share a year earlier, and analysts had a consensus of $1.95 per share. Net sales in the Americas were $2.7 billion (34 percent of global sales), up 4 percent from the prior year’s quarter. Europe sales were $5.3 billion (66 percent of global sales), up 9 percent – but only up 5 percent in euros. Gross margin was 4.99 percent versus 4.98 percent a year ago.
Most importantly, the distributor said that sales should rise in the current quarter by the mid-single digits in the Americas and by low-single digits in Europe.
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Ingram Micro Inc. (NYSE: IM) enjoyed some of the same boost, albeit a secondary boost. Its stock hit a high not seen since the 1990s at $30.82. Shares closed up 2.3% at $30.56 on Wednesday. Tech Data rose by 5.4% to $64.83.
If Ingram Micro hit a high not seen in over a decade and if Tech Data hit an all-time high, what does this tell you about the flow of technology and consumer electronics? Maybe tech investors should not be as worried as some companies may have signaled.
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