SYNNEX Beats 3Q Estimates By 16%

Citigroup has published a research report on SYNNEX Corporation SNX based on the company's impressive operating leverage in its 3Q. In the report, Citigroup writes "Synnex 3FQ EPS handily beat consensus estimates thanks to solid top line, improving product mix, a relatively rational pricing environment, and opex discipline. Mgt also highlighted that demand in the US was “stable” during the quarter, and guided to a seasonal 4FQ." "Reported revs of $2.18B grew by almost +14% yoy (after adjusting for accounting changes), or approx. 3% above consensus. More importantly, opex was kept flat sequentially thanks to cost discipline and the sale of the legacy contract manufacturing biz. The resulting operating leverage allowed the company to beat consensus EPS by more than 16%." Citigroup maintains its Buy rating and has raised the price target from $35 to $38. Synnex Corporation closed yesterday at $25.90.