PC Connection AI Stock Analysis
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PC Connection (CNXN) AI Stock Analysis
PC Connection
(NASDAQ:CNXN)
Strong earnings call with record results and robust balance sheet are the primary drivers. These are tempered by negative cash flows and fair valuation.
PC Connection (CNXN) vs. SPDR S&P 500 ETF (SPY)
- Market Cap
- $2.10B
- Dividend Yield
- 0.96%
- Average Volume (3M)
- 155.43K
- Price to Earnings (P/E)
- 20.4
- Beta (1Y)
- 0.76
- Revenue Growth
- 9.53%
- EPS Growth
- 24.84%
- Country
- US
- Employees
- 2,525
- Sector
- Technology
- Sector Strength
- 61
- Industry
- Technology Distributors
PC Connection Business Overview & Revenue Model
Company Description
PC Connection, Inc., together with its affiliates, offers a comprehensive range of information technology (IT) solutions. The company structures its operations into three main divisions: Business Solutions, Enterprise Solutions, and Public Sector Sol...
How the Company Makes Money
Connection primarily generates revenue by selling third-party IT products and solutions to customers across its business, enterprise, and public sector segments. The largest revenue stream is product resale—such as computers and mobile devices, serve...
PC Connection Earnings Call Summary
The call was strongly positive, supported by record net sales, gross billings and gross profit, double-digit growth across major segments and verticals, improved operating leverage, record adjusted EBITDA, strong backlog and liquidity, and continued AI-related demand. Offsetting concerns included gross-margin pressure, operating cash use from working-capital investments, slower public-sector growth, an expected 3% or 4% sequential fourth-quarter decline, no anticipated budget flush, and the expectation that endpoint demand might be down slightly in 2027.
Q3-2026 Updates
Positive Updates
Negative Updates
Company Guidance
For Q4, Connection said it expects business to be down 3% or 4% sequentially from Q3 to Q4, with SG&A tracking that as well; the company expects to continue to outperform the U.S. IT market by 200 basis points this year. For 2027, it expects AI to continue to drive endpoint demand, but endpoint demand might be down slightly in '27 from '26, while demand for on-prem, for Agentic server, for networking, security and software will continue to be pretty solid.
PC Connection Financial Statement Overview
Summary
Solid income statement with 5.5% revenue growth and stable margins, paired with an exceptionally strong balance sheet featuring near-zero debt. Offset by negative TTM cash flows from working capital investments.
Income Statement
68PositiveBalance Sheet
94Very PositiveCash Flow
32Negative| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 3.15B | 2.87B | 2.80B | 2.85B | 3.12B | 2.89B |
| Gross Profit | 587.68M | 539.33M | 519.79M | 511.74M | 526.18M | 464.58M |
| EBITDA | 149.79M | 125.43M | 110.46M | 118.22M | 132.56M | 108.68M |
| Net Income | 102.56M | 83.72M | 87.09M | 83.27M | 89.22M | 69.91M |
Balance Sheet | ||||||
| Total Assets | 1.52B | 1.35B | 1.30B | 1.19B | 1.10B | 1.08B |
| Cash, Cash Equivalents and Short-Term Investments | 343.31M | 406.68M | 442.61M | 297.19M | 122.93M | 108.31M |
| Total Debt | 6.71M | 996.00K | 3.36M | 4.91M | 8.16M | 10.21M |
| Total Liabilities | 535.17M | 440.80M | 388.36M | 347.61M | 333.65M | 400.91M |
| Stockholders Equity | 981.13M | 910.13M | 910.99M | 840.77M | 766.17M | 682.47M |
Cash Flow | ||||||
| Free Cash Flow | -20.58M | 58.05M | 166.29M | 188.36M | 25.81M | 47.45M |
| Operating Cash Flow | -12.40M | 65.44M | 173.87M | 197.95M | 34.89M | 57.75M |
| Investing Cash Flow | -16.24M | 42.83M | -115.29M | -160.20M | -9.08M | -8.73M |
| Financing Cash Flow | -34.60M | -93.37M | -25.22M | -15.73M | -11.19M | -36.37M |
PC Connection Technical Analysis
Price Trends
Market Momentum
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CNXN, the sentiment is Neutral. The current price of 83.16 is below the 20-day moving average (MA) of 85.47, below the 50-day MA of 87.27, and above the 200-day MA of 73.17, indicating a neutral trend. The MACD of -1.70 indicates Positive momentum. The RSI at 42.82 is Neutral, neither overbought nor oversold. The STOCH value of 40.65 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CNXN.
PC Connection Risk Analysis
PC Connection disclosed 28 risk factors in its most recent earnings report. PC Connection reported the most risks in the "Tech & Innovation" category.
Latest Risks Added
2 New RisksPC Connection Peers Comparison
Overall Rating
CLMB78Outperform
SNX76Outperform- CNXN71Outperform
ARW69Neutral
PLUS66Neutral
SCSC64Neutral
Financial Indicators
| Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
| CLMB | 78Outperform | $801.55M | 33.06 | 19.25% | 0.10% | 24.23% | 10.53% |
| SNX | 76Outperform | $19.22B | 14.66 | 14.94% | 0.79% | 24.10% | 77.90% |
| CNXN | 71Outperform | $2.11B | 20.45 | 10.89% | 0.96% | 9.53% | 24.84% |
| ARW | 69Neutral | $10.01B | 9.95 | 14.84% | ― | 32.46% | 118.04% |
| PLUS | 66Neutral | $2.52B | 19.33 | 12.21% | 1.07% | 12.10% | 13.22% |
| SCSC | 64Neutral | $908.33M | 13.72 | 7.43% | ― | 14.77% | -0.71% |
| Sector * | 61Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% |
* Technology Sector Average
Performance Comparison
| Show on chart | Ticker | Company Name | Price | Change | % Change |
|---|---|---|---|---|---|
| CNXN | Pc Connection | 83.16 | 24.82 | 42.55% | |
| ARW | Arrow Electronics, Inc. | 198.20 | 90.04 | 83.25% | |
| PLUS | Eplus Inc | 97.13 | 8.02 | 9.00% | |
| SCSC | ScanSource Inc | 44.26 | 3.55 | 8.72% | |
| SNX | TD SYNNEX Corporation | 242.51 | 93.24 | 62.46% | |
| CLMB | Climb Global Solutions, Inc. | 43.09 | 15.77 | 57.69% |
PC Connection Corporate Events
PC Connection Posts Record Q3 Sales and Earnings
PositiveOn October 28, 2026, Connection reported strong third-quarter results for the period ended September 30, 2026, posting record net sales of $874.3 million, gross billings of $1.3 billion, and gross profit of $161.9 million. Net income rose 27.2% year...
PC Connection Appoints New President and Chief Operating Officer
PositiveOn October 14, 2026, PC Connection announced that Matt Zafirovski had joined the company as President and Chief Operating Officer, effective October 12, 2026, reporting to CEO Timothy McGrath, who relinquished the President title but remained Chief E...
PC Connection Posts Record Q2 Results, Raises Dividend
PositiveOn July 29, 2026, Connection reported record financial results for the second quarter ended June 30, 2026, highlighted by net sales of $854.0 million, up 12.4% year on year, and net income of $33.2 million, up 33.8%. The company’s gross margin improv...
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.
Date of analysis: Oct 29, 2026