PC Connection (NASDAQ:CNXN) Reaches New 1-Year High - Should You Buy?

Key Points

• PC Connection reached a new 52-week high, trading as high as $90.67, with a market capitalization of approximately $2.25 billion.
• The company exceeded quarterly expectations, reporting $1.31 in EPS versus the $1.00 consensus and revenue of $854 million versus estimates of $764.79 million. Analysts’ average rating is “Strong Buy.”
• PC Connection pays a quarterly dividend of $0.20, equivalent to an annualized $0.80 payout and a 0.9% yield; insiders have recently sold shares, while institutional investors own 42.85% of the company.

Shares of PC Connection, Inc. (NASDAQ:CNXN - Get Free Report) reached a new 52-week high during trading on Tuesday. The stock traded as high as $90.67 and last traded at $89.7210, with a volume of 3458 shares changing hands. The stock had previously closed at $89.70.

Wall Street Analyst Weigh In

A number of research analysts recently commented on CNXN shares. Zacks Research upgraded PC Connection from a "hold" rating to a "strong-buy" rating in a report on Thursday, July 30th. Weiss Ratings cut PC Connection from a "buy (b)" rating to a "buy (b-)" rating in a research note on Wednesday, September 16th. One equities research analyst has rated the stock with a Strong Buy rating and one has given a Buy rating to the company. According to data from MarketBeat.com, the stock presently has an average rating of "Strong Buy".

PC Connection Stock Down 0.4%

The company has a market cap of $2.25 billion, a price-to-earnings ratio of 23.63, a PEG ratio of 2.14 and a beta of 0.85. The stock's 50-day simple moving average is $82.94 and its 200 day simple moving average is $72.45.

PC Connection (NASDAQ:CNXN - Get Free Report) last announced its quarterly earnings results on Wednesday, July 29th. The company reported $1.31 earnings per share for the quarter, beating analysts' consensus estimates of $1.00 by $0.31. The business had revenue of $854.00 million during the quarter, compared to analysts' expectations of $764.79 million. PC Connection had a net margin of 3.21% and a return on equity of 10.90%. On average, sell-side analysts expect that PC Connection, Inc. will post 4.18 EPS for the current fiscal year.

PC Connection Dividend Announcement

The company also recently announced a quarterly dividend, which was paid on Friday, August 28th. Shareholders of record on Tuesday, August 11th were given a $0.20 dividend. The ex-dividend date of this dividend was Tuesday, August 11th. This represents a $0.80 dividend on an annualized basis and a yield of 0.9%. PC Connection's payout ratio is presently 21.16%.

Insider Buying and Selling

In other news, Chairman Patricia Gallup sold 7,142 shares of the firm's stock in a transaction on Monday, September 14th. The stock was sold at an average price of $85.42, for a total transaction of $610,069.64. Following the completion of the transaction, the chairman directly owned 6,934,901 shares in the company, valued at $592,379,243.42. This trade represents a 0.10% decrease in their ownership of the stock. The transaction was disclosed in a filing with the SEC, which is available at the SEC website. Insiders sold 35,710 shares of company stock worth $2,872,655 in the last 90 days. 56.60% of the stock is owned by corporate insiders.

Hedge Funds Weigh In On PC Connection

Several hedge funds have recently bought and sold shares of CNXN. BlackRock Inc. acquired a new position in PC Connection in the 2nd quarter valued at about $158,833,000. Dimensional Fund Advisors LP lifted its position in shares of PC Connection by 0.3% during the first quarter. Dimensional Fund Advisors LP now owns 1,526,494 shares of the company's stock worth $89,237,000 after purchasing an additional 4,345 shares in the last quarter. Bank of New York Mellon Corp boosted its stake in shares of PC Connection by 1.2% in the first quarter. Bank of New York Mellon Corp now owns 138,286 shares of the company's stock valued at $8,084,000 after purchasing an additional 1,650 shares during the period. Denali Advisors LLC boosted its stake in shares of PC Connection by 19.1% in the second quarter. Denali Advisors LLC now owns 99,200 shares of the company's stock valued at $7,241,000 after purchasing an additional 15,900 shares during the period. Finally, Man Group plc acquired a new position in shares of PC Connection in the second quarter valued at approximately $6,925,000. Institutional investors and hedge funds own 42.85% of the company's stock.

About PC Connection

PC Connection, Inc NASDAQ: CNXN is an information technology solutions provider serving businesses, government agencies, educational institutions and other organizations. The company supplies technology products and provides services designed to help customers plan, implement and manage their IT environments.

Its offerings include computers and mobile devices, servers, storage systems, networking equipment, software, peripherals and communications products. PC Connection also provides professional and lifecycle services, including consulting, systems integration, cloud and data-center solutions, cybersecurity, managed services, deployment, configuration and technical support.

Founded in 1982, the company operates primarily in the United States through brands and business units that include Connection, GovConnection and MoreDirect.

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