📊 CNXN Key Takeaways
Is Pc Connection Inc. (CNXN) a Good Investment?
PC Connection exhibits stalled growth (2.5% YoY revenue, flat earnings) with anemic profitability metrics (2.8% operating margin, 1.9% ROE) typical of low-margin wholesale distribution. While the balance sheet is fortress-like with no debt and strong liquidity, the company generates insufficient returns on capital with deteriorating cash conversion, making it unattractive as a core holding.
PC Connection shows solid fundamental stability, with a debt-free balance sheet, strong liquidity, and consistently positive free cash flow. However, growth is modest and profitability remains structurally thin, with flat net income and slightly declining diluted EPS despite revenue expansion. The business appears financially healthy, but the quality of growth is only moderate because incremental sales are not translating into stronger earnings power.
Why Buy Pc Connection Inc. Stock? CNXN Key Strengths
- Fortress balance sheet with 2.70x current ratio and zero debt
- Strong cash position of $196.3M provides downside protection
- Profitable with positive free cash flow generation of $12.3M
- Stable business in essential IT distribution sector
- Debt-free balance sheet with strong liquidity ratios and substantial cash reserves
- Positive operating cash flow and free cash flow with minimal capital intensity
- Stable profitability profile supported by decent gross margin and solid returns on equity and assets
CNXN Stock Risks: Pc Connection Inc. Investment Risks
- Revenue growth stalled at 2.5% YoY with zero net income growth indicating structural headwinds
- Abysmal returns on capital (1.9% ROE, 1.2% ROA) and operating margins of only 2.8% provide no margin for error
- Weak cash flow conversion with operating cash flow of only $14.3M on $721.9M revenue (2.0% OCF margin)
- Competitive wholesale distribution sector with limited pricing power and commoditized products
- Very thin operating and net margins leave limited room for execution mistakes or demand weakness
- Revenue growth is modest while net income is flat and EPS is slightly down, indicating weak operating leverage
- Low free cash flow margin suggests limited earnings expansion unless margin discipline improves
Key Metrics to Watch
- Revenue growth acceleration and operating margin expansion trajectory
- Free cash flow yield and return on invested capital trends
- Market share dynamics in IT distribution and gross margin sustainability
- Operating margin and net margin progression
- Free cash flow conversion relative to net income
Pc Connection Inc. (CNXN) Financial Metrics & Key Ratios
💡 AI Analyst Insight
The relatively thin 1.7% FCF margin may limit capital allocation flexibility. Strong liquidity with a 2.70x current ratio provides a solid financial cushion.
CNXN Profit Margin, ROE & Profitability Analysis
CNXN vs Technology Sector: How Pc Connection Inc. Compares
How Pc Connection Inc. compares to Technology sector averages
Sector benchmarks are approximate industry averages. Actual sector performance may vary.
Is Pc Connection Inc. Stock Overvalued? CNXN Valuation Analysis 2026
Based on fundamental analysis, Pc Connection Inc. has mixed fundamental signals relative to the Technology sector in 2026.
Note: This is a fundamental analysis based on SEC filings. For P/E ratio, price targets, and market-based valuation, consult financial data providers. This is not investment advice.
Pc Connection Inc. Balance Sheet: CNXN Debt, Cash & Liquidity
CNXN Revenue & Earnings Growth: 5-Year Financial Trend
5-Year Trend Summary: Pc Connection Inc.'s revenue has remained relatively flat over the 5-year period, with a 1% decline. The most recent EPS of $3.15 reflects profitable operations.
CNXN Revenue Growth, EPS Growth & YoY Performance
CNXN Quarterly Earnings & Performance
| Quarter | Revenue | Net Income | EPS |
|---|---|---|---|
| Q1 2026 | $701.0M | $13.5M | $0.51 |
| Q3 2025 | $709.1M | $24.7M | $0.97 |
| Q2 2025 | $736.5M | $24.8M | $0.97 |
| Q1 2025 | $632.0M | $13.2M | $0.50 |
| Q3 2024 | $693.1M | $25.6M | $0.97 |
| Q2 2024 | $733.5M | $19.7M | $0.75 |
| Q1 2024 | $632.0M | $13.2M | $0.50 |
| Q3 2023 | $693.1M | $23.2M | $0.88 |
Data sourced from SEC EDGAR 10-Q quarterly filings. Figures may represent quarterly or cumulative values.
Pc Connection Inc. Dividends, Buybacks & Capital Allocation
CNXN SEC Filings: Latest 10-K & 10-Q Analysis
Access official SEC EDGAR filings for Pc Connection Inc. (CIK: 0001050377)
📋 Recent SEC Filings
❓ Frequently Asked Questions about CNXN
What is the AI rating for CNXN?
Pc Connection Inc. (CNXN) has a Combined AI Rating of SELL from Claude (SELL) and ChatGPT (HOLD) with 78% combined confidence, based on fundamental analysis of SEC EDGAR filings.
What are CNXN's key strengths?
Claude: Fortress balance sheet with 2.70x current ratio and zero debt. Strong cash position of $196.3M provides downside protection. ChatGPT: Debt-free balance sheet with strong liquidity ratios and substantial cash reserves. Positive operating cash flow and free cash flow with minimal capital intensity.
What are the risks of investing in CNXN?
Claude: Revenue growth stalled at 2.5% YoY with zero net income growth indicating structural headwinds. Abysmal returns on capital (1.9% ROE, 1.2% ROA) and operating margins of only 2.8% provide no margin for error. ChatGPT: Very thin operating and net margins leave limited room for execution mistakes or demand weakness. Revenue growth is modest while net income is flat and EPS is slightly down, indicating weak operating leverage.
What is CNXN's revenue and growth?
Pc Connection Inc. reported revenue of $721.9M.
Does CNXN pay dividends?
Pc Connection Inc. pays dividends, with $5.0M distributed to shareholders in the trailing twelve months.
Where can I find CNXN SEC filings?
Official SEC filings for Pc Connection Inc. (CIK: 0001050377) including 10-K, 10-Q, and 8-K reports are available on SEC EDGAR.
What is CNXN's EPS?
Pc Connection Inc. has a diluted EPS of $0.68.
How is the AI analysis conducted?
Two independent AI systems — Claude (Anthropic) and ChatGPT (OpenAI) — analyze SEC EDGAR filings including 10-K annual reports and 10-Q quarterly reports. Each AI evaluates financial health, profitability ratios, balance sheet strength, and growth metrics. The combined rating reflects both perspectives for balanced insights.
Is CNXN a good stock to buy right now?
Based on our AI fundamental analysis in May 2026, Pc Connection Inc. has a SELL rating with 78% confidence. Review the strengths and risks sections above before making a decision. This is not investment advice.
Is CNXN stock overvalued or undervalued?
Valuation metrics for CNXN: ROE of 1.9% (sector avg: 22%), net margin of 2.4% (sector avg: 18%). Compare these metrics with sector averages to assess valuation.
Should I buy CNXN stock in 2026?
Our dual AI analysis gives Pc Connection Inc. a combined SELL rating for 2026. Revenue is data pending, with profitability at or below sector average. Always conduct your own research.
What is CNXN's free cash flow?
Pc Connection Inc.'s operating cash flow is $14.3M, with capital expenditures of $2.0M. FCF margin is 1.7%.
How does CNXN compare to other Technology stocks?
Vs Technology sector averages: Net margin 2.4% (avg: 18%), ROE 1.9% (avg: 22%), current ratio 2.70 (avg: 2.5).