Synnex tanks on guidance letdown
The third quarter results declared by SYNNEX Corporation(NYSE:SNX) on Tuesday after trading hours, was in line with analysts’ expectations. However, the company’s forecast for the current quarter ending November was lower than expected and resulted in the stock tanking more than 5 percent on Wednesday. The high tech contractor is the latest in the list of companies related to the personal computer industry to disappoint the market.
Analysts had projected third quarter revenues of $2.86 billion and earnings of $1.16 a share. But the Fremont, California based company has forecast revenues in the range of $2.71 billion and $2.81 billion and earnings between $1.02 and $1.06 per share. As a result, analysts have started cutting price targets, with an analyst from Raymond James setting a new target of $38 from the earlier $40.
Will SNX Recover After The Recent Slump? Find Out Here
The personal computer industry in general is going through a harrowing period with retail and business customers taking to new products like tablet computers.
On Wednesday afternoon, the Synnex stock was trading at $32.35, down $1.90 or 5.6 percent.
Staples to speed up stores shut down
A statement from office products company Staples, Inc.(NASDAQ:SPLS), that it will close some of its stores earlier than expected, resulted in the stock dropping sharply on Wednesday. However, it cut back some of the decline in the afternoon.
On Tuesday, the Massachusetts based company had said that it is going to close about 15 U.S. Stores earlier than originally planned, and also spoke of shutting 45 stores and some delivery businesses in Europe. The office supply retailer wants to focus more on its online and mobile business and also plans to offer more products to business customers.
The company had posted poor results in the second quarter due to lower computer, software and office supplies sales. Tablets and other devices have dented Staples’ computer business. The crisis in Europe has also affected sales in the region.
Shares of SPLS ended lower on Wednesday at $11.40, down 4%. The stock has lost 8% in the past two trading sessions.