PC Connection, Inc. (CNXN) vs ScanSource, Inc. (SCSC)

PC Connection, Inc. and ScanSource, Inc. are both Electronics & Computer Distribution companies. PC Connection, Inc. is the larger, with a market value of $2.3B against $1.2B — 1.9× the size. ScanSource, Inc. trades at the lower P/E: 16.2× against 23.6×. ScanSource, Inc. grew revenue faster over the last twelve months: 6.09% against 3.23%. PC Connection, Inc. has the higher net margin (3.21% vs 2.44%) and the higher return on invested capital (12.0% vs 6.67%). Across the 22 metrics below, ScanSource, Inc. leads on 12 and PC Connection, Inc. on 10.

Valuation

Metric CNXN SCSC Electronics & Computer Distribution median
P/E 23.57 16.22 16.80
P/S 0.75 0.40 0.48
P/B 2.37 1.41 1.83
Price to free cash flow 67.97 11.27 13.78
EV/EBITDA 14.81 10.55 10.55
EV/Sales 0.64 0.40 0.40
Earnings yield 4.24% 6.16% 5.24%
Free cash flow yield 1.47% 8.87% 3.11%

Profitability

Metric CNXN SCSC Electronics & Computer Distribution median
Gross margin 18.89% 13.56% 14.67%
Operating margin 3.92% 3.06% 2.89%
Net margin 3.21% 2.44% 2.35%
Free cash flow margin 1.14% 3.53% 1.72%
Return on equity 10.43% 8.68% 9.56%
Return on assets 7.11% 4.24% 3.10%
Return on invested capital 11.96% 6.67% 7.54%

Growth

Metric CNXN SCSC Electronics & Computer Distribution median
Revenue growth (TTM) 3.23% 6.09% 6.09%
EPS growth (last fiscal year) (0.61%) 21.33% 17.81%
Revenue growth, 5-year CAGR 2.09% 0.47% 1.79%
Net income growth, 5-year CAGR 8.47% 48.85% 4.24%

Health

Metric CNXN SCSC Electronics & Computer Distribution median
Debt to equity 0.00 0.11 0.24
Current ratio 2.88 1.76 1.40
Net debt to EBITDA (3.65) 0.11 1.23

Dividend

Metric CNXN SCSC Electronics & Computer Distribution median
Dividend yield 0.84% — 0.96%
Payout ratio 0.20 — 0.20

Size

Metric CNXN SCSC Electronics & Computer Distribution median
Market cap 2.29b 1.22b 1.76b

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