Why PC Connection is on investors’ radar today

PC Connection (CNXN) has attracted attention after recent share price moves, with the stock closing at $60.15. That is putting fresh focus on how its current valuation compares with its fundamentals.

Recent moves, including a 2.31% 1 day share price return and a 5.75% year to date share price return, sit alongside a 1 year total shareholder return of 15.34% decline. As a result, short term momentum contrasts with weaker recent income adjusted performance.

If PC Connection’s recent rebound has you thinking more broadly about tech, this could be a good moment to screen for other opportunities across high growth tech and AI stocks.

With PC Connection trading at $60.15, alongside an indicated intrinsic discount of about 35% and a price target of $76.00, you have to ask: is this a genuine value gap, or is the market already pricing in future growth?

Most Popular Narrative: 20.9% Undervalued

Compared with PC Connection’s last close at $60.15, the most followed narrative points to a fair value of $76.00, anchored on detailed revenue and earnings assumptions.

Ongoing shift in customer demand from commodity hardware toward integrated IT solutions and managed services, alongside PC Connection's investment in technical capabilities, enhances customer retention and supports a transition to higher-margin, recurring revenue streams, which may improve net margins over time.

Curious what justifies that higher valuation band? The narrative focuses on steadier top line growth, firmer margins and a future earnings multiple below many peers.

Result: Fair Value of $76.00 (UNDERVALUED)

However, the picture could change quickly if hardware margins continue to tighten or if public sector weakness persists and begins to weigh more heavily on earnings.

Build Your Own PC Connection Narrative

If this narrative does not quite fit how you see PC Connection, you can stress test the numbers yourself and build a custom view in minutes with Do it your way.

A good starting point is our analysis highlighting 3 key rewards investors are optimistic about regarding PC Connection.

Looking for more investment ideas?

If PC Connection has sparked your interest, do not stop here. The next step is to widen your watchlist and pressure test your thinking across other themes.

• Spot potential value candidates early by checking out these 867 undervalued stocks based on cash flows that might be pricing in more caution than their cash flows imply.
• Back big trends in automation and machine learning by scanning these 29 AI penny stocks that align with your view on long term tech adoption.
• Strengthen your income stream by reviewing these 11 dividend stocks with yields > 3% that combine yield with fundamentals you find comfortable.

If you skip these screens, you could miss ideas that fit your approach better than your current watchlist. Take a few minutes to run the filters now.

This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.