ScanSource Story

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SCSC -- USA Stock  

USD 19.03  0.14  0.74%

As many rational traders are trying to avoid technology space, it makes sense to go over ScanSource a little further and understand how it stands against Barnes Noble and other similar entities. We are going to analyze some of the competitive aspects of both ScanSource and Barnes.
Published over three weeks ago
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Our viewpoint on ScanSource (NASDAQ:SCSC) and Barnes Noble (NYSE:BKS)?
By analyzing existing basic indicators between ScanSource and Barnes, you can compare the effects of market volatilities on both companies' prices and check if they can diversify away market risk if combined in one of your portfolios. You can also utilize pair trading strategies for matching a long position in Barnes with a short position in ScanSource. Check out our pair correlation module for more information.

Let's begin by analyzing the assets. The asset utilization indicator refers to the revenue earned for every dollar of assets a company currently reports. ScanSource has an asset utilization ratio of 255.5 percent. This suggests that the company is making $2.56 for each dollar of assets. An increasing asset utilization means that ScanSource is more efficient with each dollar of assets it utilizes for everyday operations.
Out of tens of thousands of stocks, funds, and ETFs that trade on global exchanges each represent an individual company which you can analyze using comparative analysis. To determine which one of the two companies, such as ScanSource or Barnes is a better fit for your portfolio, analyzing a few basic fundamental indicators is a good first step.

How important is ScanSource's Liquidity

ScanSource financial leverage refers to using borrowed capital as a funding source to finance ScanSource ongoing operations. It is usually used to expand the firm's asset base and generate returns on borrowed capital. ScanSource financial leverage is typically calculated by taking the company's all interest-bearing debt and dividing it by total capital. So the higher the debt-to-capital ratio (i.e., financial leverage), the riskier the company. Please check the breakdown between ScanSource's total debt and its cash.

Correlation Between ScanSource and Barnes Noble

In general, stock analysis is a method for investors and traders to make individual buying and selling decisions. Stock correlation analysis is also essential because it can help investors realize that they may not be as diversified as they think. Risk management strategies are usually required to make sure all portfolios are properly aligned against their risk tolerance level. You can consider holding ScanSource together with similar or unrelated positions with a negative correlation. For example, you can also add Barnes Noble to your portfolio. If Barnes Noble is not perfectly correlated to ScanSource it will diversify some of the market risks out of the positively correlated stocks in your portfolio. However, the disadvantage of this sort of hedging is that it can potentially affect your investment returns throughout market cycles. When ScanSource for example, for example, performs excellent and delivers stable returns, the negatively correlated position you locked in as a hedge may drag your returns down. Please check pair correlation details between SCSC and BKS for more information.

Purchase by Michael Grainger of 2700 shares of ScanSource

Legal trades by ScanSource insiders are very common, as founders, directors, or employees of any publicly traded firm often have stock or stock options. These trades are made public in the United States through the filing of Form 4 of the Securities and Exchange Commission. Below entry was recorded recently and is publicly available as an insider trade:
ScanSource insider trading alert for perchase of common stock by Michael Grainger, the corporate stakeholder, on 16th of September 2020. This event was filed by Scansource Inc with SEC on 2020-09-16. Statement of changes in beneficial ownership - SEC Form 4 [view details]   
Note, although insider trading is legal, in the United States, Canada, Australia, and Germany, for mandatory reporting purposes, corporate insiders are defined as a company's officers, directors, and any beneficial owners of more than 10% of a class of the company's equity securities.

Another Deeper Perspective

Revenue is income that a firm generates from business activities such us rendering services or selling goods to customers. It is a crucial part of a business and an essential item when evaluating a company's financial statements. Revenues from a firm's primary business operations can be reported on the income statement as sales revenue, net sales, or simply sales, depending on the industry in which a given company operates.
Revenue is typically recorded when cash or cash equivalents are exchanged for services or goods and can include product or services discounts, promotions, as well as early payments on invoices or services rendered in advance.

Revenue Breakdown

Let me now analyze ScanSource revenue. Based on the latest financial disclosure, ScanSource reported 3.81 B of revenue. This is 6.52% lower than that of the Technology sector and significantly higher than that of the Electronics & Computer Distribution industry. The revenue for all United States stocks is 59.62% higher than that of ScanSource. As for Barnes Noble we see revenue of 3.55 B, which is much higher than that of the Electronics & Computer Distribution

ScanSource3.81 Billion
Barnes3.55 Billion
3.8 B
3.5 B

Another 3 percent rise for ScanSource

The jensen alpha is down to -0.24 as of today. As of the 31st of August, ScanSource has the Risk Adjusted Performance of 0.0268, coefficient of variation of 6511.75, and Semi Deviation of 3.45. In relation to fundamental indicators, the technical analysis model makes it possible for you to check existing technical drivers of ScanSource, as well as the relationship between them. In other words, you can use this information to find out if the company will indeed mirror its model of past prices and volume data, or the prices will eventually revert. We are able to interpolate and collect nineteen technical drivers for ScanSource, which can be compared to its competition. Please validate ScanSource treynor ratio, and the relationship between the standard deviation and downside variance to decide if ScanSource is priced more or less accurately, providing market reflects its prevalent price of 24.66 per share. Given that ScanSource has jensen alpha of (0.24), we advise you to double-check ScanSource's current market performance to make sure the company can sustain itself at a future point.

Our Final Takeaway

When is the right time to buy or sell ScanSource? Buying stocks such as ScanSource isn't very hard. However, what challenging for most investors is doing it at the right time. Proper market timing is something most people cannot do without sophisticated tools, which help to isolate the right opportunities, deliver winning trades and diversify portfolios on a daily bases. To summarize, as of the 31st of August 2020, we believe ScanSource is currently undervalued. It responds to the market and projects below average odds of distress in the next two years. Our primary 30 days 'Buy-Sell' recommendation on the company is Cautious Hold.

About Contributor

This story should be regarded as informational only and should not be considered a solicitation to sell or buy any financial products. Macroaxis does not express any opinion as to the present or future value of any investments referred to in this post. This post may not be reproduced without the consent of Macroaxis LLC. Macroaxis LLC and Raphi Shpitalnik do not own shares of ScanSource. Please refer to our Terms of Use for any information regarding our disclosure principles.

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