Synnex (SNX:NYS) Fundamental Valuation Report

Fundamental Valuation Report


Industrials:Business Services

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Close Price/Date
$96.28 (USD) 29/01/2019

Weighted Valuation
$124.23 (USD)

Overall Rating
Undervalued by 29.0%

Valuation Models Analyst Consensus: $130.00 (USD)
(in order of importance) Discounted Cash Flow: $120.05 (USD)
Multiples: $115.30 (USD)
Valuation Methods This company is:
Cash Flow: Undervalued on a Cash Flow Valuation
Comparable Company: Overvalued on a Comparable Valuation
Asset: Undervalued on an Asset Valuation

Company Overview (SNX:NYS USD)

Price 96.28
Range 95.88 – 97.47
52 week 73.27 – 127.54
Open 97.43
Vol / Avg. 436582/617154
Mkt cap 4.93B
P/E 11.18
Div/yield 1.40/0.02
EPS 7.19
Shares 51.23M
Beta 0.68

Company Description

Synnex Corp is a provider of wholesale IT integration, distribution, and outsourcing services. The company operates two business segments: technology solutions and Concentrix. Technology solutions, the larger segment by revenue, resells and distributes peripherals; IT systems, including data center servers and storage solutions; system components; software, networking, communication, and security equipment; consumer electronics; and complementary products. Concentrix offers end-to-end business services focused on consumer engagement and process optimisation. Clients include resellers, retailers, original equipment manufacturers, and financial and insurance institutions. Most of the firm’s revenue is generated in the United States of America.

Valuation Details

 We have up to 6 valuation points for each company. Details are at the bottom of the report.

Discounted Cash Flow and Sensitivity Analysis for SNX:NYS

Using a discounted cash flow model we generated an intrinsic value of $120.05 (USD) for SNX:NYS

Sensitivity Analysis

(showing how changes in the input variables impact the DCF calculation)

SNX:NYS Current Values Valuation If Dropped * Valuation If Raised *
Calculated Value: $120.05 1% 5% 1% 5%
WACC (or Ke) 5.92 $154.89 $96.81
Terminal Growth Rate 0.90 $98.53 $152.27
Tax Rate 0.34 $136.28 $103.82
Cash Flow 944,265,008 $108.42 $131.68
Capital Expenditures -100,713,400 $118.84 $121.26
Long Term Debt 808,422,000 $120.84 $119.26

* Changes are absolute: ex WACC from 8% to 7%

Comparables Model

Using similar companies and price based ratios we generated a valuation of $46.69 (USD) for SNX:NYS. We also generated a valuation of $135.80 (USD) using other metrics and comparables.
The comparable companies were Booz Allen Hamilton Hldg (BAH:NYS), Conduent (CNDT:NYS), Deluxe (DLX:NYS), FTI Consulting (FCN:NYS) and Maximus (MMS:NYS).

Company SNX:NYS End Date Value
Earnings/Share $7.19 (USD)
Book Value/Share $45.91 (USD)
Sales/Share $496.52 (USD)
Cash Flow/Share $5.45 (USD)
EBITDA/Share $18.73 (USD)
Price Based on Comps Adjustment Factor (%)
$110.59 (USD) -58.6
$166.50 (USD) -70.9
$453.01 (USD) -90.9
($24.96) (USD) -50.7
$182.38 (USD) -30.1
11.65 PE Ratio 15.38 18.40 0.00 10.47 13.22 19.43
1.76 PB Ratio 3.63 9.93 0.67 1.79 1.89 3.85
0.16 PS Ratio 1.09 1.03 0.42 0.93 1.27 1.79
14.84 PCF Ratio 10.73 14.05 8.71 5.53 12.09 13.26
8.04 EV to EBITDA 9.74 12.55 9.47 6.58 9.59 10.50


Using a multiples approach we generated a valuation of  $115.30 (USD) for SNX:NYS

Company SNX:NYS End Date Value
Earnings/Share $7.19 (USD)
Book Value/Share $45.91 (USD)
Sales/Share $496.52 (USD)
Cash Flow/Share $5.45 (USD)
EBITDA/Share $18.73 (USD)
Price Based on Comps Adjustment Factor
$122.66 (USD) 0
$92.11 (USD) 0
$129.33 (USD) 0
$59.29 (USD) 0
$173.12 (USD) 0
Ratios Ratio Average
PE Ratio 17.06
PB Ratio 2.01
PS Ratio 0.26
PCF Ratio 10.89
EV to EBITDA 9.24

Adjusted Book Value versus Historical Price to Book

The average the Price to Book ratio for  SNX:NYS for the last 10 years was  1.95

We ran the Adjusted Book Value for  SNX:NYS and generated a book value of  $67.70 (USD)
By multiplying these we get an adjusted valuation of  $131.70 (USD)

Analyst Data

In the Stockcalc database there are 1 analysts that provide a valuation for SNX:NYS. The 1 analysts have a concensus valuation for SNX:NYS for 2019 of $130.00 (USD).

SNX:NYS Synnex

Analyst Recommendation
Buy Hold Sell Rating
(of 5)
Guidance As Of
1 0 0 5.0000 Buy 2018-10-26

Current Price: 96.28 USD

Analyst Consensus
USD Millions 2019
Mean EPS 10.89
# EPS Analysts 1
Mean Revenue 20,666.30
# Revenue Analysts 1
Mean Target Price 130.00
Mean Cash Flow
Mean Net Income 435.60
Mean Debt Outstanding
Mean Tax Rate 28.40
Mean Growth Rate
Mean Capital Expenditure

Explanation of Valuation Models

We have up to 6 valuation points for each company in the database.

The Discounted Cash Flow (DCF) valuation is a cash flow model where cash flow projections are discounted back to the present to calculate value per share. DCF is a common valuation technique especially for companies undergoing irregular cash flows such as resource companies (mining, forestry, oil and gas) going though price cycles or smaller companies about to generate cash flow (junior exploration companies, junior pharma, technology firms…).

The Price Comparables valuation is the result of valuing the company we are looking at on the basis of ratios from selected comparable companies: Price to Earnings, Price to Book, Price to Sales, Price to Cash Flow, Enterprise Value (EV) to EBITDA. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

We have included the Other Comparables as a way to value companies that cannot be valued using Earnings based ratios. This technique is very useful for companies still experiencing negative cash flows such as mining exploration firms. We use Cash/Share, Book Value/Share, MarketCap, 1 Year Return, NetPPE as the ratios here. Each of these ratios for the selected comparable companies are averaged and multiplied by the values for the company we are interested in to calculate a value per share for our selected company.

Multiples are similar to Price comparables where we look at current or historic ratios for the company in question to assess what it should be worth today based on those historic ratios. We use the same 5 ratios as in the price comparables and value the company with its historic averages.

With Adjusted Book Value (ABV) we calculate the book value per share for the company based on its balance sheet and multiply that book value per share by its historical price to book ratio to calculate a value per share.

If we have Analyst coverage for the company we use the consensus target price here.

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