Stock Buy: Ingram Micro Inc.

Zacks Investment Research
updated | Zacks.com

Ingram Micro Inc (NYSE:IM) just reported another earnings surprise and analysts are raising their forecasts.

Company Description

Ingram Micro provides marketing, logistic, technical and other services for its customers. The company serves technology vendors and resellers across the globe.

Another Earnings Surprise

Ingram Micro reported fourth-quarter earnings per share of 61 cents on Feb 18. This number came in 9 cents ahead of expectations and is the company’s sixth surprise in 7 quarters.

Management highlighted the impressive sequential growth, lead by North America. Ingram Micro’s CEO, Gregory Spierkel, concluded his comments by saying “…There is still more work to do, but the trends are positive and we are externally focused on growth with enhanced profitability.”

Analysts React

Ingram Micro analysts have raised their full-year estimates following the report. The Zacks Consensus Estimate for 2010 is up 18 cents, to $1.70. Next year’s projections average $1.94, up 19 cents.

Given last year’s earnings of $1.34, the expected growth rates are 27% this year and 14% in 2011.

Value to Boot

In addition to solid growth, shares of IM are trading at under 11 times forward earnings. The growth is coming at a discount with a PEG ratio of 0.8 times.

The Chart

Full-year estimates are bouncing back sharply after a steep drop. Shares have stabilized lately, but as estimates continue to climb, the stock should follow.

Ingram Micro - ticker IM > <P ALIGN=

Bill Wilton is the Growth Stock Strategist for Zacks.com. He is also the Editor in charge of the market-beating Zacks Growth Trader service

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