Quality Investor

ScanSource, Inc.

Rank #319Capital Return

SCSC · Nasdaq · Technology

ScanSource, Inc. (SCSC) — Rank #319 by gross profitability (GP/assets 0.23) · ROE 8.7% · Piotroski F-Score 6 / 9.

As-of 2026-09-15 · CIK 0000918965 · all metrics point-in-time as of the filing date.

About

ScanSource, Inc. engages in the distribution of technology products and solutions in the United States, Brazil, and internationally.

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It operates through two segments: Specialty Technology Solutions, and Intelisys & Advisory. The Specialty Technology Solutions segment offers mobility and barcode, including mobile computing; barcode scanners and imagers, radio frequency identification devices, barcode printing and related services; point of sale systems and integrated pos software platforms; payment terminals, such as self-service kiosks, payment terminals and mobile payment devices; physical security comprising video surveillance and analytics, and video management software and access control; networking, such as switching, and routing and wireless products and software; communications, including voice, video, communication platform integration, and contact center solutions; managed connectivity and wireless enablement solutions. This segment offers applications that have evolved from traditional uses, such as inventory control, materials handling, distribution, shipping and warehouse management, and healthcare applications. The Intelisys & Advisory segment offers connectivity and software-defined networking, CX (unified communications as a service and contact center as a service), cloud/data center, security, managed AI, and wireless and IOT. This segment helps channel sales partners service various end users, including businesses of all sizes. It serves manufacturing, warehouse and distribution, retail and e-commerce, hospitality, transportation and logistics, government, education and healthcare, and other industries. ScanSource, Inc.

was incorporated in 1992 and is headquartered in Greenville, South Carolina.

Industry
Electronics & Computer Distribution
Sector
Technology
Filer Category
Large accelerated filer
Fiscal Year End
June 30

Price History

SCSC+54.9% · +9.2% CAGRSPY+80.5% · +12.5% CAGR

Company Snapshot

P/E and reverse DCF are the primary valuation lenses at this stage.

Market Cap

$1.17B

P/E (annual)

15.8

P/S (annual)

0.4

P/B

1.3

P/OCF (annual)

9.5

Shareholder Yield

15.0%

Employees

2,100

Industry

Electronics & Computer Distribution

Exchange

Nasdaq

Signal Flags

1 green1 yellow2 red
Operating leverage expandingOperating income growing faster than revenue
Disclosure regressionA previously-disclosed line item is no longer reported — worth checking the filing for why
Revenue declining YoYRevenue contracted year over year
Balance sheet deterioratingNet cash collapsed with receivables or inventory outpacing revenue

Quality Profile

Profitability

1/1 pass
GP / assets
0.23
Return on equity
8.7%
Gross margin trend
PASS

Safety

1/1 pass
Balance-sheet safety
PASS
Debt / equity
1.12
Current ratio
1.76×
Net cash
-$13.04M

Cash Flow

3/3 pass
Positive FCF
PASS
Cash-backed earnings
PASS
Accruals healthy
PASS
SBC / revenue
0.4%

Growth

1/2 pass
Revenue growth
-9.6%
Piotroski F-Score
6 / 9
Share dilution
-15.0%

Terry Smith quality gate

Passes 1/5 Terry Smith thresholds

1 of 5 threshold not computable from filed data.

What Growth Is Priced In

Implied revenue growth (10Y)

-0.6%

incredible deal

The annual FCF growth rate today's price requires over a 10-year horizon (discount rate 10%, terminal growth 2.5%).

Buyback tailwind: -15.0% — per-share value needs a total required return of -15.6% once share-count change is priced in.

vs. own 6-year median revenue growth: 7.0%

within its own history

Cost-of-equity sensitivity (implied growth at different discount rates)

r = 8%

-4.4%

r = 10% (base)

-0.6%

r = 12%

2.7%

Net debt / market cap: 1.0%

Base FCF: $113.8M3Y mean FCF: $19.7M

Valuation History

Current multiple vs historical range at each filing date. Band spans 25th-75th percentile.

P / E

Price / diluted EPS

7.9xCheap
7.9xmed 15.9x73.1x

P / S

Price / revenue per share

0.2xCheap
0.2xmed 0.2x0.3x

P / B

Price / book value per share

0.8xCheap
0.8xmed 1.1x1.5x

P / GP

Price / gross profit per share

1.6xCheap
1.6xmed 2.1x3.2x

P / FCF

Price / free cash flow per share

N/A
3.6xmed 12.8x56.1x

FCF yield, shareholder yield, and buyback activity are the primary reads at this stage.

Profitability

Gross profitability (GP / assets)

0.23

Primary signal (Novy-Marx).

9th of 9 SIC 50 peers

Return on equity

8.7%

Gross margin

13.6%

9th of 9 SIC 50 peers

Revenue growth (YoY)

-9.6%

Gross margin improving

Margin trend vs prior year.

PASS

Operating Leverage

2018202120222023
Revenue vs COGS
Revenue vs OpEx
Op. Income vs Revenue

Growth

Revenue CAGR (3Y)

-5.2%

Revenue CAGR (5Y)

0.5%

Earnings CAGR (3Y)

-4.2%

FCF CAGR (3Y)

Anti-fragile safety

Balance-sheet safety

Composite anti-fragile check.

PASS

Debt / equity

1.12

8th of 9 SIC 50 peers (best = lowest)

Current ratio

1.76×

8th of 9 SIC 50 peers

Quick ratio

1.00×

Net cash

-$13.04M

Cash & equivalents minus total debt.

Cash-flow health

Free cash flow

$113.84M

Operating cash flow minus capex.

Positive free cash flow

PASS

FCF / net income

0.44

Cash-backing of earnings.

FCF/NI divergence

Unfavorable divergence (yellow flag).

PASS

Accruals healthy

Cash-backed earnings.

PASS

SBC / revenue

0.4%

Stock-based comp intensity.

Piotroski F-Score

F-Score

6 / 9

Fundamental-strength score (0-9).

Lifecycle Phase History

20162023
Value
Decline