(SCSC) ScanSource - Ratings and Ratios

ScanSource Inc (NASDAQ:SCSC) is a technology distributor operating in the United States, Canada, and Brazil, offering a broad range of products and solutions through its two main segments: Specialty Technology Solutions and Modern Communications & Cloud. The company provides specialized technology solutions, including enterprise mobile computing, data capture, and point of sale (POS) systems, to various industries such as retail, healthcare, and government.

The Specialty Technology Solutions segment focuses on automating information collection and processing for commercial applications, while the Modern Communications & Cloud segment delivers communications technologies and services, including voice, video conferencing, and cybersecurity solutions. ScanSource serves a diverse customer base across multiple industries, including manufacturing, education, and transportation.

From a technical analysis perspective, the stock is currently trading at $40.48, slightly below its 20-day simple moving average (SMA) of $40.86. The 50-day SMA is $37.49, indicating a potential support level, while the 200-day SMA is $42.92, suggesting a longer-term resistance level. The Average True Range (ATR) is $1.20, representing a 2.96% daily volatility.

Fundamentally, ScanSource has a market capitalization of $913.65 million and a price-to-earnings (P/E) ratio of 14.55, with a forward P/E of 10.89. The companys return on equity (RoE) is 7.41%, indicating a relatively stable financial performance. Given the current technical and fundamental data, a potential forecast is that the stock may experience a short-term correction towards the 50-day SMA, followed by a potential rebound towards the 200-day SMA, driven by the companys stable financials and growth prospects in the technology distribution sector.

Based on the analysis, a potential trading strategy could be to accumulate the stock around the 50-day SMA, with a target price near the 200-day SMA, while monitoring the companys quarterly earnings and industry trends for potential catalysts. The relatively low P/E ratio and stable RoE suggest that ScanSource may be undervalued, presenting a potential buying opportunity for investors.