SCSC gets a fundamental rating of 6 out of 10. The analysis compared the fundamentals against 123 industry peers in the Electronic Equipment, Instruments & Components industry. SCSC is in great health and has no worries on liquidiy or solvency at all, but the profibility rating is only average. SCSC is valued quite cheap, while showing a decent growth score. This is a good combination! These ratings would make SCSC suitable for value investing!

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

In the past year SCSC was profitable.
In the past year SCSC had a positive cash flow from operations.
In the past 5 years SCSC has always been profitable.
The reported operating cash flow has been mixed in the past 5 years: SCSC reported negative operating cash flow in multiple years.

1.2 Ratios

SCSC has a Return On Assets of 4.34%. This is in the better half of the industry: SCSC outperforms 69.11% of its industry peers.
SCSC's Return On Equity of 8.15% is fine compared to the rest of the industry. SCSC outperforms 69.11% of its industry peers.
SCSC's Return On Invested Capital of 6.46% is fine compared to the rest of the industry. SCSC outperforms 67.48% of its industry peers.
SCSC had an Average Return On Invested Capital over the past 3 years of 6.97%. This is in line with the industry average of 8.87%.

		Industry Rank	Sector Rank
ROA	4.34%
ROE	8.15%
ROIC	6.46%

ROA(3y)4.23%

ROA(5y)3.58%

ROE(3y)8.72%

ROE(5y)7.73%

ROIC(3y)6.97%

ROIC(5y)7%

1.3 Margins

The Profit Margin of SCSC (2.48%) is comparable to the rest of the industry.
In the last couple of years the Profit Margin of SCSC has declined.
The Operating Margin of SCSC (3.12%) is comparable to the rest of the industry.
In the last couple of years the Operating Margin of SCSC has grown nicely.
SCSC's Gross Margin of 13.79% is on the low side compared to the rest of the industry. SCSC is outperformed by 73.17% of its industry peers.
SCSC's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	3.12%
PM (TTM)	2.48%
GM	13.79%

OM growth 3Y-4.89%

OM growth 5Y10.34%

PM growth 3Y-2.2%

PM growth 5YN/A

GM growth 3Y3.61%

GM growth 5Y2.87%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), SCSC is destroying value.
The number of shares outstanding for SCSC has been reduced compared to 1 year ago.
The number of shares outstanding for SCSC has been reduced compared to 5 years ago.
The debt/assets ratio for SCSC has been reduced compared to a year ago.

2.2 Solvency

An Altman-Z score of 3.92 indicates that SCSC is not in any danger for bankruptcy at the moment.
SCSC has a Altman-Z score (3.92) which is comparable to the rest of the industry.
SCSC has a debt to FCF ratio of 1.62. This is a very positive value and a sign of high solvency as it would only need 1.62 years to pay back of all of its debts.
The Debt to FCF ratio of SCSC (1.62) is better than 80.49% of its industry peers.
A Debt/Equity ratio of 0.14 indicates that SCSC is not too dependend on debt financing.
SCSC has a Debt to Equity ratio of 0.14. This is comparable to the rest of the industry: SCSC outperforms 51.22% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.14
Debt/FCF	1.62
Altman-Z	3.92

ROIC/WACC0.45

WACC14.25%

2.3 Liquidity

SCSC has a Current Ratio of 2.16. This indicates that SCSC is financially healthy and has no problem in meeting its short term obligations.
SCSC's Current ratio of 2.16 is in line compared to the rest of the industry. SCSC outperforms 43.09% of its industry peers.
A Quick Ratio of 1.32 indicates that SCSC should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.32, SCSC is doing worse than 62.60% of the companies in the same industry.

		Industry Rank	Sector Rank
Current Ratio	2.16
Quick Ratio	1.32

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The Earnings Per Share has grown by an nice 19.18% over the past year.
The Earnings Per Share has been growing by 11.73% on average over the past years. This is quite good.
The Revenue has decreased by -4.88% in the past year.
SCSC shows a decrease in Revenue. Measured over the last years, the Revenue has been decreasing by -0.05% yearly.

EPS 1Y (TTM)19.18%

EPS 3Y-3.4%

EPS 5Y11.73%

EPS Q2Q%26.19%

Revenue 1Y (TTM)-4.88%

Revenue growth 3Y-4.85%

Revenue growth 5Y-0.05%

Sales Q2Q%-4.63%

3.2 Future

The Earnings Per Share is expected to grow by 24.78% on average over the next years. This is a very strong growth
SCSC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 5.71% yearly.

EPS Next Y20.91%

EPS Next 2Y16.28%

EPS Next 3Y24.78%

EPS Next 5YN/A

Revenue Next Year4.57%

Revenue Next 2Y4.95%

Revenue Next 3Y5.71%

Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.

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4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 10.74, which indicates a very decent valuation of SCSC.
Compared to the rest of the industry, the Price/Earnings ratio of SCSC indicates a rather cheap valuation: SCSC is cheaper than 93.50% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of SCSC to the average of the S&P500 Index (27.21), we can say SCSC is valued rather cheaply.
SCSC is valuated reasonably with a Price/Forward Earnings ratio of 8.43.
95.12% of the companies in the same industry are more expensive than SCSC, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 25.98, SCSC is valued rather cheaply.

		Industry Rank	Sector Rank
PE	10.74
Fwd PE	8.43

4.2 Price Multiples

Based on the Enterprise Value to EBITDA ratio, SCSC is valued cheaper than 95.94% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of SCSC indicates a rather cheap valuation: SCSC is cheaper than 93.50% of the companies listed in the same industry.

		Industry Rank	Sector Rank
P/FCF	10.84
EV/EBITDA	7.35

4.3 Compensation for Growth

The low PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a rather cheap valuation of the company.
A more expensive valuation may be justified as SCSC's earnings are expected to grow with 24.78% in the coming years.