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Insight Enterprises (NSIT)
NASDAQ:NSIT
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Insight Enterprises
(NASDAQ:NSIT)73Outperform
Positive Factors
Strategic Objectives
Insight’s main strategic objective is to become the leading solutions integrator, which involves the bundling of hardware and software products and IT services.
Negative Factors
Earnings
The company reported Q3/24 total net revenue of $2.09 billion, which was 11% less than the forecast of $2.35 billion and 2% less than the FactSet consensus forecast of $2.34 billion.
Market Demand
Insight's Q3 sales and EPS and forward guidance were well below Consensus on continued weak demand for hardware products, including both client devices and infrastructure.
Insight Enterprises (NSIT) vs. S&P 500 (SPY)
Market Cap
$4.92B
Dividend YieldN/A
Average Volume (3M)404.16K
Price to Earnings (P/E)23.4
Beta (1Y)1.18
Revenue Growth-5.17%
EPS Growth-9.73%
CountryUS
Employees14,324
SectorTechnology
Sector Strength48
IndustryHardware & Equipment
Share Statistics
EPS (TTM)6.52
Shares Outstanding31,777,678
10 Day Avg. Volume425,084
30 Day Avg. Volume404,157
Financial Highlights & Ratios
PEG Ratio1.32
Price to Book (P/B)N/A
Price to Sales (P/S)0.56
Price to Cash Flow (P/CF)5.60
P/FCF Ratio5.60
Enterprise Value/Market CapN/A
Enterprise Value/RevenueN/A
Enterprise Value/Gross ProfitN/A
Enterprise Value/EbitdaN/A
Forecast
1Y Price Target
$193.00Price Target Upside23.47% Upside
Rating ConsensusHold
Number of Analyst Covering1
Insight Enterprises Business Overview & Revenue Model
Company DescriptionInsight Enterprises, Inc. (NSIT) is a leading global provider of information technology solutions that help organizations design, build, and manage their IT environments. Operating across multiple sectors including healthcare, finance, retail, and government, Insight delivers a wide range of products and services such as cloud solutions, data center optimization, networking, and digital transformation services. With a focus on innovation and customer satisfaction, Insight empowers businesses to navigate the complexities of the digital landscape.
How the Company Makes MoneyInsight Enterprises generates revenue through a diverse array of services and products that cater to the IT needs of businesses worldwide. The company's primary revenue streams include the sale of software and hardware products, which encompass everything from data center equipment to personal computing devices. Additionally, Insight provides a comprehensive suite of IT services, including consulting, integration, and managed services, which contribute significantly to its earnings. The company also benefits from strategic partnerships with major technology vendors like Microsoft, Cisco, and Dell, which enhance its product offerings and market reach. Insight's ability to provide end-to-end solutions tailored to client needs is a key factor in its financial success.
Insight Enterprises Financial Statement Overview
Summary
Insight Enterprises presents a solid financial profile with strong profitability and cash flow management. Despite recent declines in revenue and net income, the company's operational efficiency and cash flow generation provide a stable financial footing. Continued focus on revenue growth and maintaining a balanced leverage will be crucial for sustained financial health.Income Statement
Insight Enterprises shows a strong gross profit margin with consistent profitability across recent years. Despite a slight decrease in revenue over the past year, the company maintains healthy EBIT and EBITDA margins, indicating operational efficiency. However, the recent decline in net income and revenue growth rate suggests potential challenges in sustaining top-line growth.78
Positive
Balance Sheet
The company's balance sheet reflects a moderate debt-to-equity ratio, suggesting a balanced approach to leveraging. The return on equity remains stable, indicating efficient use of equity. However, the equity ratio shows a reliance on liabilities, which could pose risk if not managed carefully.72
Positive
Cash Flow
Insight Enterprises demonstrates robust cash flow management, with significant free cash flow and operating cash flow exceeding net income. The company has shown consistent growth in free cash flow, reinforcing its ability to generate cash sustainably. This strength in cash flow management provides a solid foundation for future investments and debt servicing.85
Very Positive
| Breakdown | ||||
| Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 | Dec 2020 |
|---|---|---|---|---|
| Income Statement | Total Revenue | |||
| 8.70B | 9.18B | 10.43B | 9.44B | 8.34B | Gross Profit |
| 1.77B | 1.67B | 1.64B | 1.45B | 1.30B | EBIT |
| 388.58M | 419.80M | 413.70M | 332.06M | 271.57M | EBITDA |
| 388.58M | 481.45M | 476.52M | 385.85M | 351.74M | Net Income Common Stockholders |
| 249.69M | 281.31M | 280.61M | 219.34M | 172.64M |
| Balance Sheet | Cash, Cash Equivalents and Short-Term Investments | |||
| 259.23M | 268.73M | 163.64M | 103.84M | 128.31M | Total Assets |
| 6.38B | 6.29B | 5.11B | 4.69B | 4.31B | Total Debt |
| 864.11M | 1.17B | 637.90M | 361.61M | 438.69M | Net Debt |
| 604.88M | 903.64M | 474.26M | 257.77M | 310.37M | Total Liabilities |
| 4.61B | 4.55B | 3.47B | 3.18B | 2.97B | Stockholders Equity |
| 1.77B | 1.74B | 1.64B | 1.51B | 1.34B |
| Cash Flow | Free Cash Flow | |||
| 586.06M | 580.28M | 27.17M | 111.63M | 331.40M | Operating Cash Flow |
| 632.85M | 619.53M | 98.11M | 163.71M | 355.58M | Investing Cash Flow |
| -303.28M | -505.20M | -137.84M | -21.07M | 9.71M | Financing Cash Flow |
| -321.27M | -16.71M | 114.01M | -161.38M | -361.79M |
Insight Enterprises Technical Analysis
Negative
156.31
Price Trends
162.03
Negative
169.40
Negative
187.31
Negative
Market Momentum
-3.79
Positive
36.47
Neutral
29.13
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For NSIT, the sentiment is Negative. The current price of 156.31 is below the 20-day moving average (MA) of 160.78, below the 50-day MA of 162.03, and below the 200-day MA of 187.31, indicating a bearish trend. The MACD of -3.79 indicates Positive momentum. The RSI at 36.47 is Neutral, neither overbought nor oversold. The STOCH value of 29.13 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for NSIT.
Insight Enterprises Risk Analysis
Insight Enterprises disclosed 25 risk factors in its most recent earnings report. Insight Enterprises reported the most risks in the “Finance & Corporate” category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Insight Enterprises Peers Comparison
Overall Rating
UnderperformOutperform
Sector (59)
Financial Indicators
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
73 Outperform | $4.92B | 23.42 | 14.24% | ― | -5.17% | -9.73% | |
69 Neutral | $22.87B | 21.65 | 49.04% | 1.49% | -1.77% | -1.82% | |
68 Neutral | $4.25B | 13.93 | 6.45% | 2.60% | -12.21% | -51.31% | |
66 Neutral | $5.52B | 15.03 | 6.78% | ― | -15.66% | -54.03% | |
64 Neutral | $832.49M | 14.42 | 6.79% | ― | -15.92% | -25.15% | |
59 Neutral | $22.39B | 11.53 | -18.05% | 2.31% | 5.00% | -25.89% | |
49 Neutral | $94.98M | ― | -56.63% | ― | -100.00% | -24.28% |
* Technology Sector Average
Performance Comparison
NSIT
Insight Enterprises
156.31
-29.94
-16.08%
ARW
Arrow Electronics
109.34
-10.69
-8.91%
AVT
Avnet
50.44
5.02
11.05%
SCSC
ScanSource
36.72
-6.98
-15.97%
CDW
CDW
168.37
-76.58
-31.26%
ANIX
Anixa Biosciences
2.84
-0.41
-12.62%
Insight Enterprises Earnings Call Summary
Earnings Call Date: Feb 6, 2025 | % Change Since: -10.17% | Next Earnings Date: May 1, 2025
Earnings Call Sentiment Neutral
Insight Enterprises faced a challenging year with revenue declines and significant impacts from cloud program changes. Despite these challenges, the company achieved growth in core services, expanded gross margins, and maintained strong cash flow. Strategic partnerships have been strengthened, and cost management initiatives resulted in substantial savings. However, the overall financial performance was mixed, with some areas of growth offset by declines in revenue and increased expenses.Highlights
Gross Profit and Margin Growth
Gross profit increased by 1%, driven by a 12% growth in Insight Core Services, and gross margin expanded by 170 basis points to 21.2%.
Strong Cash Flow
Cash flow from operations was $215 million for Q4 2024 and $633 million for the full year, marking the second consecutive year with over $600 million in cash flow.
Cloud and Core Services Growth
Cloud gross profit grew by 21%, and Insight Core Services gross profit increased by 15% for the full year.
Strategic Partnerships and Awards
Insight received numerous awards from partners like Microsoft and Google and entered into new strategic agreements with Microsoft, Google, and AWS.
Successful Cost Management
Completed SG&A actions resulting in approximately $25 million in annualized reductions.
Lowlights
Revenue Decline
Net revenue decreased by 7% in Q4 and 5% for the full year, primarily due to a 10% decline in product revenue.
Challenges in Hardware and Software
Hardware revenue declined by 2%, and on-prem software was down 23%, with product gross profit down due to partner consolidations.
Impact of Cloud Program Changes
Facing $70 million impact due to changes in Google Enterprise resale and Microsoft enterprise agreements, leading to anticipated flat to slightly down cloud revenue.
Interest Expense Increase
Interest expenses increased primarily related to recent acquisitions and share buybacks, impacting adjusted diluted EPS, which was down 11% for Q4.
Company Guidance
During Insight Enterprises' fourth quarter 2024 earnings call, the company reported a 1% increase in gross profit, driven by a 12% rise in Insight Core Services. Gross margin expanded by 170 basis points to 21.2%, and adjusted diluted earnings per share reached $2.66. The company generated $215 million in cash flow from operations and completed SG&A actions resulting in $25 million in annualized reductions. For 2025, Insight anticipates mid-single-digit growth in hardware gross profit, with Insight Core Services expected to grow within the 16% to 20% range. Adjusted diluted EPS is projected to be between $9.70 and $10.10, with an expected gross margin of approximately 20%. Challenges include a $70 million impact from cloud partner program changes and increased interest expenses due to convertible note settlements. Despite these challenges, the company plans to leverage its enhanced service capabilities and expects increased traction from AI investments to drive further growth.Glossary
OutperformA stock rated as "Outperform" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock is likely to deliver higher returns compared to the average returns of other stocks in the same sector or market index. Investors might consider this stock a good buying opportunity.
NeutralA stock rated as "Neutral" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly attractive nor unattractive for investment. Investors may consider holding onto the stock, as it is not expected to either significantly outperform or underperform the market.
UnderperformA stock rated as "Underperform" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests that the stock may deliver lower returns compared to the average returns of other stocks in the same sector or market index. Investors might consider selling the stock or avoiding it as an investment.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.