Overall SCSC gets a fundamental rating of 6 out of 10. We evaluated SCSC against 124 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! This makes SCSC very considerable for value investing!

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1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

SCSC had positive earnings in the past year.
SCSC had a positive operating cash flow in the past year.
Each year in the past 5 years SCSC has 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

With a decent Return On Assets value of 4.34%, SCSC is doing good in the industry, outperforming 69.35% of the companies in the same industry.
The Return On Equity of SCSC (8.15%) is better than 69.35% of its industry peers.
SCSC has a Return On Invested Capital of 6.46%. This is in the better half of the industry: SCSC outperforms 67.74% of its industry peers.
The Average Return On Invested Capital over the past 3 years for SCSC is in line with the industry average of 8.83%.

		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.
Looking at the Operating Margin, with a value of 3.12%, SCSC is in line with its industry, outperforming 56.45% of the companies in the same industry.
In the last couple of years the Operating Margin of SCSC has grown nicely.
The Gross Margin of SCSC (13.79%) is worse than 73.39% of its industry peers.
In the last couple of years the Gross Margin of SCSC has grown nicely.

		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

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

2.2 Solvency

SCSC has an Altman-Z score of 3.94. This indicates that SCSC is financially healthy and has little risk of bankruptcy at the moment.
SCSC has a Altman-Z score (3.94) which is in line with its industry peers.
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.
Looking at the Debt to FCF ratio, with a value of 1.62, SCSC belongs to the top of the industry, outperforming 80.65% of the companies in the same industry.
SCSC has a Debt/Equity ratio of 0.14. This is a healthy value indicating a solid balance between debt and equity.
SCSC has a Debt to Equity ratio of 0.14. This is comparable to the rest of the industry: SCSC outperforms 51.61% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	0.14
Debt/FCF	1.62
Altman-Z	3.94

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 has a Current ratio (2.16) which is comparable to the rest of the industry.
A Quick Ratio of 1.32 indicates that SCSC should not have too much problems paying its short term obligations.
SCSC's Quick ratio of 1.32 is on the low side compared to the rest of the industry. SCSC is outperformed by 62.10% of its industry peers.

		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.
SCSC shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 11.73% yearly.
Looking at the last year, SCSC shows a decrease in Revenue. The Revenue has decreased by -4.88% in the last year.
Measured over the past years, SCSC shows a decrease in Revenue. The Revenue has been decreasing by -0.05% on average per year.

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

The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
The Revenue growth rate is accelerating: in the next years the growth will be better than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

SCSC is valuated reasonably with a Price/Earnings ratio of 10.74.
Compared to the rest of the industry, the Price/Earnings ratio of SCSC indicates a rather cheap valuation: SCSC is cheaper than 93.55% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.21, SCSC is valued rather cheaply.
A Price/Forward Earnings ratio of 8.43 indicates a reasonable valuation of SCSC.
Based on the Price/Forward Earnings ratio, SCSC is valued cheaply inside the industry as 95.16% of the companies are valued more expensively.
Compared to an average S&P500 Price/Forward Earnings ratio of 24.26, SCSC is valued rather cheaply.

		Industry Rank	Sector Rank
PE	10.74
Fwd PE	8.43

4.2 Price Multiples

SCSC's Enterprise Value to EBITDA ratio is rather cheap when compared to the industry. SCSC is cheaper than 95.16% of the companies in the same industry.
SCSC's Price/Free Cash Flow ratio is rather cheap when compared to the industry. SCSC is cheaper than 93.55% of the companies in the same industry.

		Industry Rank	Sector Rank
P/FCF	10.84
EV/EBITDA	7.48

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.