Better AnalysisWhen asked if someone should buy, sell or hold. GLTA
STC beat sales estimates slightly by 2%. Met EBITDA estimates but missed heavily on EPS estimates of 6 cents reporting a loss of 33 cents. Sales were up almost double compared to last year due to the Star2star acquisition and the larger than expected loss was due to transaction and interest expenses from the NetFortris acquisition, which did not contribute anything to the quarter due to the timing of the closing. Supply-chain issues continued to weigh on gross margins, but only slightly in the 1-2% range. However, STC has been able to meet all customer orders. Overall it was not the best quarter, but certainly not a disaster. We think the company will navigate supply-chain issues well, especially as its revenues continue to become more service-based. We would wait for shares to settle before averaging down and would HOLD for now. (5iResearch)