The Best And Worst Channel Company Stocks In The First Half Of 2019

Twenty of the 27 publicly held channel companies on our watch list saw the price of their stock increase in the first half of 2019 – many by hefty double-digit amounts and one that nearly doubled its stock price. Take a look at which company's stock increased the most.

Channel Stocks : Major Value Gains In The First Half Of 2019

After a roller coaster end to 2018, stock markets in the first half of 2019 were generally on the rise despite uncertainties about the global economy and trade tensions with China. (The roller coaster has since resumed, especially in August as recession fears worsened.)

The Dow Jones closed the six months of trading (ended June 28) at 26,599.96, up more than 14 percent from the close of 2018. The tech-heavy Nasdaq fared even better, closing out the first half at 8006.24, up nearly 21 percent from its 2018 close.

So how did publicly held solution provider companies and distributors fare? Of the 27 companies on our watch list, 20 recorded stock price increases between the start of the year and June 28 and seven recorded stock price declines. Many of the companies had double-digit stock price gains and one nearly doubled its value.

Here's a look at how some of the biggest solution provider companies did in the first half of 2019, starting with companies with the biggest gains in share price, based on stock closing prices on Dec. 31, 2018 and June 28, 2019.

PCM

CEO: Frank Khulusi

Dec. 31, 2018 Close: $17.61

June 28, 2019 Close: $35.04

Change: +98.98%

On June 24, PCM (No. 30 on the CRN Solution Provider 500) struck a deal to be acquired by Insight Enterprises for $35 a share or $581 million. The deal was concluded on Aug. 30. The acquisition makes Insight Enterprises, No. 14 on the CRN Solution Provider 500, a $9 billion channel powerhouse.

For the first six months of 2019, PCM reported net sales of $1.08 billion, down 1 percent from just under $1.09 billion in the first half of 2018. Net income for the six-month period increased 20 percent year over year to $12.9 million from $10.7 million.

Perficient

CEO: Jeffrey Davis

Dec. 31, 2018 Close: $22.26

June 28, 2019 Close: $34.32

Change: +54.18%

Perficient, No. 59 on the CRN Solution Provider 500, has been aggressively expanding into digital transformation and digital marketing in recent years.

On May 22, Perficient completed its acquisition of Sundog Interactive, a $14 million marketing and technology consulting firm that provides Salesforce solutions for manufacturers.

For the first six months of 2019, Perficient reported revenue of $275.7 million, up 13.6 percent from $242.7 million in the first half of 2018. Net income for the six-month period was $15.6 million, up more than 44 percent from $10.8 million one year earlier.

EPAM Systems

CEO: Arkadiy Dobkin

Dec. 31, 2018 Close: $116.01

June 28, 2019 Close: $173.10

Change: +49.21%

EPAM, No. 34 on the CRN Solution Provider 500, is an enterprise software design, development and consulting firm.

For the first six months of 2019, EPAM reported revenue of $1.07 billion, up more than 23 percent from $869.8 million in the first half of 2018. Net income for the six-month period was $119.5 million, up 4 percent from $114.7 million one year before.

Insight Enterprises

CEO: Kenneth Lamneck

Dec. 31, 2018 Close: $40.75

June 28, 2019 Close: $58.20

Change: +42.82%

On June 24, Insight Enterprises struck a deal to acquire PCM (No. 30 on the CRN Solution Provider 500) for $35 a share or $581 million. The deal was concluded on Aug. 30. The acquisition makes Insight Enterprises, No. 14 on the CRN Solution Provider 500, a $9 billion channel powerhouse.

For the first six months of 2019, Insight reported revenue of $3.52 billion, down 2 percent from $3.58 billion in the first half of 2018. Net earnings for the six-month period was $89.3 million, up 6 percent from $84.5 million one year earlier.

CACI International

CEO: John Mengucci

Dec. 31, 2018 Close: $144.03

June 28, 2019 Close: $204.59

Change: +42.05%

On June 4, CACI announced that Ken Asbury would retire as president and CEO, effective June 30. The company’s board named John Mengucci, CACI’s chief operating officer, as Asbury’s successor as president and CEO.

On March 1, CACI completed its acquisition of LGS Innovations, a leading provider of real-time spectrum management, C4ISR and other cyber products to the intelligence community and Department of Defense. CACI said the acquisition accelerates the company's growth in its intelligence systems and support, space operations and resiliency, communications and cybersecurity market areas.

CACI, No. 20 on the CRN Solution Provider 500, reported that for all of fiscal 2019 (ended June 30) revenue was $4.99 billion, up nearly 12 percent from $4.47 billion in fiscal 2018.

CDW

CEO: Christine Leahy

Dec. 31, 2018 Close: $81.05

June 28, 2019 Close: $111.00

Change: +36.95%

CDW, No. 5 on the CRN Solution Provider 500, has been operating under new management in 2019. Christine Leahy, who joined CDW in 2002 and was previously chief revenue officer, became the new CEO at the start of 2019. She took over from former CEO Thomas Richards, who retired at the end of 2018 after nine years.

In January, CDW struck a deal to acquire Scalar Decisions, a leading technology solutions provider in Canada, for an undisclosed sum.

For the first six months of 2019 CDW reported sales of $8.59 billion, up more than 10 percent from $7.79 billion in the first half of 2018. Net income for the six-month period was $349.5 million, up 16.5 percent from $300.0 million in the first half of 2018.

Perspecta

CEO: Mac Curtis

Dec. 31, 2018 Close: $17.22

June 28, 2019 Close: $23.41

Change: +35.95%

Perspecta, which is focused on government and military IT solutions, was created in June 2018 when DXC Technology spun off its public services business and merged it with government consultant Vencore and government background check services provider KeyPoint.

For the first quarter (ended June 30) of fiscal 2020 Perspecta, No. 25 on the CRN Solution Provider 500, reported revenue of $1.11 billion, up nearly 40 percent from $793 million in the first quarter of fiscal 2019. Net income for the quarter was $31 million, up nearly 7 percent from $29 million one year earlier.

Accenture

CEO: Julie Sweet

Dec. 31, 2018 Close: $141.01

June 28, 2019 Close: $184.72

Change: +31.00%

On Jan. 11, Pierre Nanterme announced that he was stepping down as Accenture CEO and chairman, due to health reasons. CFO David Rowland was named interim CEO. Nanterme subsequently died on Jan. 31.

On July 11, after the period covered by this analysis, Accenture named Julie Sweet, previously CEO of Accenture North America, to be the company’s new CEO. Rowland was named Accenture chairman and is acting as an advisor to Sweet.

Accenture, No. 2 on the CRN Solution Provider 500, has continued its aggressive acquisition strategy this year, especially in the areas of digital transformation, integrated marketing and digital agency services. Acquisitions this year include data intelligence company Knowledgent, financial service industry consultancy Orbium, analytics and data specialist Analytics 8 and communications service consultancy Northstream.

For the first nine months (ended May 31) of its fiscal 2019 Accenture reported revenue of $32.16 billion, up 5.5 percent from $30.49 billion in the first three quarters of fiscal 2018. Net income for the nine-month period was $3.70 billion, up nearly 17 percent from $3.17 billion one year earlier.

Tech Data Corp.

CEO: Rich Hume

Dec. 31, 2018 Close: $81.81

June 28, 2019 Close: $104.60

Change: +27.86%

On March 7, distributor Tech Data announced a $100 million increase in its share repurchase program. (On Aug. 29, after the period covered by this analysis, Tech Data increased the share repurchase program by an additional $200 million.)

For the first six months (ended July 31) of its fiscal 2020 Tech Data reported net sales of $17.50 billion, essentially flat with $17.43 billion for the first six months of fiscal 2019. Net income for the first half of fiscal 2020 was $134.7 million, up 23 percent from $109.6 million one year before.

SS&C Technologies

CEO: William Stone

Dec. 31, 2018 Close: $45.11

June 28, 2019 Close: $57.61

Change: +27.71%

SS&C, No. 21 on the CRN Solution Provider 500, completed several significant acquisitions in 2018 including Intralinks for $1.5 billion, Eze Software Group for $1.45 billion and DST Systems for $5.4 billion.

On Aug. 8, after the period covered by this analysis, SS&C announced a $500 million common stock repurchase program.

For the first six months of 2019 SS&C reported revenue of $2.29 billion, up more than 73 percent from $1.32 billion in the first half of 2018. The company reported net income of $201.9 million in the first six months of 2019 compared to a $12.5 million net loss one year earlier.

ManTech International

CEO: Kevin Phillips

Dec. 31, 2018 Close: $52.29

June 28, 2019 Close: $65.85

Change: +25.93%

On March 1, ManTech International, a leading technology solutions provider for military, civilian and intelligence government agencies, struck a deal to acquire Kforce Government Solutions for $115 million. Kforce provides technology solutions, transformation management, data management and analytics in support of federal health and defense missions. The acquisition was completed April 1.

On Aug. 8, after the period covered by this analysis, ManTech acquired H2M Group in a move to expand its geospatial, intelligence and analysis capabilities.

For the first six months of 2019, ManTech, No. 33 on the CRN Solution Provider 500, reported revenue of $1.04 billion, up 7.7 percent from $964.3 million in the first half of 2018. Net income for the six-month period was $45.3 million, up more than 13 percent from $40.0 million one year earlier.

CGI Group

CEO: George Schindler

Dec. 31, 2018 Close: $61.19

June 28, 2019 Close: $76.77

Change: +25.46%

On March 11 CGI, No. 11 on the CRN Solution Provider 500, offered to acquire Acando AB, a leading IT and digital services consulting firm in Northern Europe and Germany for 4,320 million Swedish Kroner (approximately U.S. $450 million). The acquisition was completed on April 16.

On June 11, CGI announced its intent to repurchase 5.16 million shares held by Caisse de depot et placement du Quebec.

For the first three quarters (ended June 30) of its fiscal 2019 CGI reported revenue of (Canadian) $9.15 billion (U.S. $6.86 billion), up 5 percent from (Canadian) $8.71 billion (U.S. $6.53 billion) in the first three quarters of fiscal 2018. Net earnings for the nine-month period were (Canadian) $939.1 million (U.S. $704.1 million), up nearly 11 percent from (Canadian) $847.8 million (U.S. $635.7 million) one year before.

Avnet

CEO: William Amelio

Dec. 31, 2018 Close: $36.10

June 28, 2019 Close: $45.27

Change: +25.40%

For its fiscal 2019 (ended June 29), Avnet reported sales of $19.52 billion, up 2.5 percent from $19.04 billion in fiscal 2018. The distributor reported net income of $176.3 million for the year compared to the $156.4 million net loss recorded in fiscal 2018.

Quality Technology Services

CEO: Chad Williams

Dec. 31, 2018 Close: $37.05

June 28, 2019 Close: $46.18

Change: +24.64%

Data center service provider QTS, No. 62 on the CRN Solution Provider 500, expanded its international presence with the April acquisition of two operating data centers in the Netherlands.

For the first six months of 2019 QTS reported revenue of $231.9 million, up 2.6 percent from $226.0 million in the fist half of 2018. The company reported net income of $13.0 million for the six-month period compared to the $8.2 million loss reported one year earlier.

Synnex Corp.

CEO: Dennis Polk

Dec. 31, 2018 Close: $80.84

June 28, 2019 Close: $98.60

Change: +21.97%

For the first six months (ended May 31) of its fiscal 2019 Synnex reported revenue of $10.97 billion, up nearly 17 percent from $9.40 billion in the first half of fiscal 2018. Net income for the six-month period was $201.6 million, up 71 percent from $117.8 million one year earlier.

Connection

CEO: Timothy McGrath

Dec. 31, 2018 Close: $29.73

June 28, 2019 Close: $34.98

Change: +17.66%

For the first six months of 2019 Connection, No. 26 on the CRN Solution Provider 500, reported sales of $1.37 billion, up more than 3 percent from $1.33 billion in the first half of 2018. Net income for the six-month period was $36.4 million, up 23 percent from $29.5 million one year before.

Tyler Technologies

CEO: Lynn Moore Jr.

Dec. 31, 2018 Close: $185.82

June 28, 2019 Close: $216.02

Change: +16.25%

Tyler Technologies provides software and services for the public sector.

On Feb. 1, Tyler, No. 46 on the CRN Solution Provider 500, struck a deal to acquire MicroPact, a provider of specialized, vertically oriented case management and business process management applications for government, for approximately $185 million in cash. The acquisition closed Feb. 28.

For the first half of 2019 Tyler Technologies reported revenue of $522.2 million, up 14 percent from $457.2 million in the first half of 2018. Net income for the six-month period was $59.3 million, down 23 percent from just under $77.0 million one year before.

Presidio

CEO: Bob Cagnazzi

Dec. 31, 2018 Close: $13.05

June 28, 2019 Close: $13.67

Change: +4.75%

On Aug. 14, after the period covered by this analysis, London-based private equity firm BC Partners struck a deal to take Presidio private for $2.1 billion, just two and a half years after the company went public. BC Partners is paying $16 per share under the deal.

For its fiscal 2019 (ended June 30) Presidio, No. 23 on the CRN Solution Provider 500, reported revenue of $3.03 billion, up 9.4 percent from $2.77 billion in fiscal 2018. Net income for the fiscal year was $35.2 million, down nearly 74 percent from $133.9 million in fiscal 2018.

DXC Technology

CEO: Mike Lawrie

Dec. 31, 2018 Close: $53.17

June 28, 2019 Close: $55.15

Change: +3.72%

At the start of the year DXC Technology, No. 3 on the CRN Solution Provider 500, reached a deal to buy Switzerland-based digital consultancy Luxoft for $2 billion. The acquisition was completed in June.

For its fiscal 2020 first quarter (ended June 30) DXC reported revenue of $4.89 billion, down 7.4 percent from $5.28 billion in the first quarter of fiscal 2019. Net income for the quarter was $168 million, down nearly 37 percent from $266 million one year before.

Arrow Electronics

CEO: Michael Long

Dec. 31, 2018 Close: $68.95

June 28, 2019 Close: $71.26

Change: +3.35%

For the first six months of 2019 Arrow Electronics reported sales of $14.50 billion, up 1.6 percent from $14.27 billion in the first half of 2018. The company reported a net loss of $408.2 million for the six-month period compared to net income of $309.0 million one year earlier. The results included a second-quarter $698 million impairment charge.

Cognizant Technology Solutions

CEO: Brian Humphries

Dec. 31, 2018 Close: $63.48

June 28, 2019 Close: $63.39

Change: -0.14%

On Feb. 6 ,Cognizant announced that its board had named Brian Humphries, then the CEO of Vodaphone Business, as the company's new CEO, effective April 1. Francisco D'Souza, Cognizant's co-founder and CEO since 2007, remains at the company as vice-chairman of the board.

On Feb. 15 Cognizant agreed to pay a $25 million fine to settle charges of conspiracy to violate anti-bribery laws following an investigation by the U.S. Securities and Exchange Commission and the U.S. Department of Justice.

The charges involved an alleged $2 million bribe paid by Cognizant to a government official in India where the company was building a new facility. Cognizant's former president and chief legal officer were indicted separately on charges of conspiracy to violate anti-bribery laws.

In March, Cognizant, No. 6 on the CRN Solution Provider 500, launched a $600 million accelerated share repurchase program.

For the first six months of 2019, Cognizant reported revenue of $8.25 billion, up 4.2 percent from $7.92 billion in the first half of 2018. Net income for the six-month period was $950 million, down 2.7 percent from $976 million in the same period one year before.

Computer Task Group

CEO: Filip J.L. Gyde

Dec. 31, 2018 Close: $4.08

June 28, 2019 Close: $4.01

Change: -1.72%

On Feb. 6 IT solutions and services provider CTG completed its acquisition of Luxembourg-based Tech-IT, a leading consulting and IT solutions company.

For the first half of 2019 CTG, No. 72 on the CRN Solution Provider 500, reported revenue of $197.6 million, up 12.7 percent from $175.4 million in the first half of 2018. Net income for the six-month period was $1.58 million, up 16 percent from $1.35 million one year earlier.

ePlus Technology

CEO: Mark Marron

Dec. 31, 2018 Close: $71.17

June 28, 2019 Close: $68.94

Change: -3.13%

In January, ePlus, No. 38 on the CRN Solution Provider 500, acquired rival solutions provider SLAIT Consulting in a move to expand its geographic reach and security capabilities and its presence in state and local education markets.

For its fiscal 2020 first quarter (ended June 30) ePlus recorded sales of $381.4 million, up 7 percent from $356.5 million in the first quarter of fiscal 2019. Net income for the quarter was $16.2 million, up 6 percent from $15.3 million one year before.

ScanSource

CEO: Mike Baur

Dec. 31, 2018 Close: $34.38

June 28, 2019 Close: $32.56

Change: -5.29%

For the company’s fiscal 2019 (ended June 30) ScanSource reported sales of $3.87 billion, up 1 percent from the $3.85 billion in sales reported for fiscal 2018. Net income for fiscal 2019 was $57.6 million, up 74 percent from $33.2 million one year earlier.

In August, after the period covered by this analysis, ScanSource said it planned to divest $623 million in business operations outside the U.S. in a move to push the company deeper into digital distribution and away from the legacy distribution model.

Conduent

CEO: Cliff Skelton

Dec. 31, 2018 Close: $10.63

June 28, 2019 Close: $9.59

Change: -9.78%

It has been a turbulent 2019 for Conduent, No. 17 on the CRN Solution Provider 500.

The company has been involved in a public spat with activist investor Carl Icahn over representation on Conduent’s board.

In May, CEO Ashok Vemuri announced that he was stepping down from the job after the company reported disappointing first-quarter results, including a 39 percent drop in new business signings and the loss of a $140 million contract with the state of California.

The turmoil resulted in Conduent's shares losing about one-third of their value on May 9.

On August 7, after the period covered by this analysis, Conduent named Cliff Skelton, who was hired in May as the company’s president and chief operating officer, to serve as interim CEO.

For the first half of 2019 Conduent reported revenue of $2.27 billion, down 19 percent from $2.81 billion in the first half of 2018. For the six-month period Conduent reported a $1.34 billion net loss compared to a $39 million net loss one year before.

Unisys

CEO: Peter Altabef

Dec. 31, 2018 Close: $11.63

June 28, 2019 Close: $9.72

Change: -16.42%

For the first half of 2019, Unisys reported revenue of $1.45 billion, up more than 5 percent from $1.38 billion in the first half of 2018. Net income for the six-month period was $6.8 million, down 85 percent from $44.4 million one year before.

Unisys is No. 24 on the CRN Solution Provider 500.

Consolidated Communications

CEO: Bob Udell

Dec. 31, 2018 Close: $9.88

June 28, 2019 Close: $4.93

Change: -50.10%

For the first half of 2019, Consolidated Communications reported revenue of $672.2 million, down nearly 5 percent from $706.3 million in the first six months of 2018. The company reported a $14.7 million net loss for the six-month period compared to a $21.9 million loss one year earlier.

Consolidated Communications is No. 39 on the CRN Solution Provider 500.