Friday, March 23, 2012

Independent e-Waste Handler Insight

Insight Electronics (NSIT:  Nasdaq) is the only electronics waste handler on Gartner’s information technology asset disposition (ITAD) magic quadrant that is both independent of electronics manufacturing and sales and a public company.  Gartner only weighed in on the ITAD sector in the last two years with its ubiquitous four squares of leaders, challengers, visionaries and niche players.  Insight was named as one of the niche players.

Insight’s services to enterprise range widely, from IT strategy and design to integration and management, and finally to disposition of assets at the end of the trail.  A tidy little business it is!  Insight reported $5.3 billion in total sales in the most recently reported twelve months, providing $100.2 million in net income.  That implies a net income margin of 1.9%, slightly higher than in previous years.

The small number of analysts that follow Insight seem to think there is more revenue and earnings in the Company’s future, enough to propel 15% annual growth over the next five years.  The consensus estimate is $5.6 billion in total sales and $2.27 in earnings per share. 

NSIT shares are trading at 9.0 times the consensus earnings estimate.  The implied price-earnings to growth measure is 0.60  -  a pretty good reason to put NSIT on your watch list.  We have Insight in our new e-cycling group in The Mothers of Invention Index.

Neither the author of the Small Cap Strategist web log, Crystal Equity Research nor its affiliates have a beneficial interest in the companies mentioned herein.

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