ScanSource reports tomorrow with an interesting backdrop: short sellers have been quietly rebuilding positions over the past week even as the stock edges higher, while options traders remain unusually put-heavy ahead of the print.
The positioning story is one of diverging signals. Short interest has climbed 4% over the past week to 4.2% of the free float — roughly 916,000 shares — after falling sharply through July from a peak near 1.37 million shares in early July. The rebuild is modest, and the borrow market offers no squeeze threat: availability is extremely loose at over 1,500%, meaning there are more than fifteen shares available to lend for every share currently borrowed. Cost to borrow has ticked up about 22% on the week but remains negligible at under 0.5% annualised. What is more interesting is the options side. The put/call ratio is running at 1.53, almost exactly in line with its 20-day average and near the middle of its recent range — but that average itself is persistently elevated. Puts outnumber calls by more than 3:2 on a sustained basis, a level that suggests the options market has maintained a cautious tilt into earnings rather than shifting more defensive in the last few days specifically.
The Street's position is lukewarm at best. The consensus is a hold, with three analysts neutral and one bullish, and the mean price target of $57 implies about 9% upside from current levels. The most recent analyst action on record is Barclays initiating at Equal-Weight with a $43 target back in October 2025 — that target now sits well below the market price, which has run hard since. Raymond James downgraded to Market Perform in August 2024, and all other listed analyst moves pre-date 2024, making the coverage picture thin and somewhat dated. Valuation has drifted lower: the P/E multiple has eased to around 10.8x and has contracted modestly over the past 30 days, while EV/EBITDA near 7x keeps SCSC firmly in value territory for a technology distributor. The ORTEX short score sits at 40.8, broadly neutral, and the dtc rank at the 8th percentile reflects the short covering that characterised much of July.
The earnings history adds context to tomorrow's event. The most comparable recent print — May 7 — delivered a 12% one-day gain and held most of that over the subsequent five sessions, closing up nearly 5% on the week. That reaction came on what was presumably a strong quarter. Whether tomorrow's result carries a similar setup is the key question, and the stock's 32% year-to-date gain means the bar for a positive surprise may be higher than it was in the spring. Peers have had a rougher week: CNXN fell 2.4% and PLUS dropped 3%, while CTS and CXT lost more than 6% each — a relative outperformance for SCSC that may reflect some pre-earnings positioning rather than underlying sector strength.
Institutional ownership adds a stable floor: BlackRock holds nearly 19% of shares, with Dimensional and Pzena also prominent. Pzena added around 196,000 shares through June, the largest active accumulation in the holder table, consistent with a value-oriented investor comfortable buying into weakness. On the insider side, net activity over the past 90 days shows net selling — the CEO sold over $890,000 worth of shares in March, partially offset by the Lead Independent Director purchasing $211,000 at prices around $35 in February. Neither is a strong directional signal at current levels, though the director's buy at $35 now looks well-timed.
The next 24 hours centre on one thing: whether tomorrow's earnings release delivers a result that justifies the stock's sharp year-to-date re-rating, or whether the persistent options caution and modest short rebuild prove prescient.
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