Softcat (LON:SCT) Announces Quarterly Earnings Results

Softcat (LON:SCT) issued its quarterly earnings results on Wednesday. The company reported GBX 75.80 earnings per share for the quarter, Digital Look Earnings reports. Softcat had a return on equity of 46.24% and a net margin of 7.61%.

Here are the key takeaways from Softcat’s conference call:

• Softcat reported an exceptional FY 2026, with gross profit up 24.7% to £616.3 million and underlying operating profit up 19.4% to £215.1 million. Customer growth accelerated to more than 10,500, while gross profit per customer increased 20.6%.
• Underlying operating costs rose 27.7%, faster than gross profit, reducing the operating-profit-to-gross-profit ratio to 34.9% from 36.4%. Profitability was also affected by lower-margin product mix, Microsoft licensing changes, large lower-margin projects and one-off employee, advisory and incentive costs.
• For FY 2027, management expects high-single-digit underlying operating profit growth excluding GDT, with gross profit growth modestly moderated by tougher comparisons, the absence of unusually large projects and prior-year memory-related order pull-forward. Non-underlying costs are expected to rise roughly two to two-and-a-half times because of GDT acquisition and integration expenses.
• Management sees substantial long-term demand from AI-driven infrastructure investment, including data centers, networking, security, cloud and services. The GDT acquisition is expected to add U.S. and Americas fulfillment, infrastructure expertise and global cross-selling opportunities, although estimated post-deal leverage will initially rise to 1.3x net debt to EBITDA.

Softcat Price Performance

Shares of SCT traded up GBX 3 during mid-day trading on Friday, hitting GBX 1,700. The company’s stock had a trading volume of 1,339,130 shares, compared to its average volume of 1,776,860. The firm has a market capitalization of £3.66 billion, a P/E ratio of 24.25, a P/E/G ratio of 11.51 and a beta of 0.58. The company has a current ratio of 1.39, a quick ratio of 1.38 and a debt-to-equity ratio of 10.41. Softcat has a 1-year low of GBX 1,083 and a 1-year high of GBX 2,134. The firm has a 50-day simple moving average of GBX 1,935.22 and a 200 day simple moving average of GBX 1,742.66.

Insider Buying and Selling at Softcat

In other Softcat news, insider Robyn Perriss bought 1,058 shares of Softcat stock in a transaction dated Friday, October 16th. The stock was bought at an average cost of GBX 1,890 per share, for a total transaction of £19,996.20. Also, insider Mayank Prakash acquired 2,645 shares of the firm’s stock in a transaction on Friday, October 16th. The stock was acquired at an average cost of GBX 1,890 per share, with a total value of £49,990.50. In the last ninety days, insiders have bought 12,816 shares of company stock valued at $24,246,219. 2.91% of the stock is owned by corporate insiders.

Analyst Upgrades and Downgrades

Several equities analysts recently issued reports on SCT shares. JPMorgan Chase & Co. lifted their price objective on shares of Softcat from GBX 1,950 to GBX 2,300 and gave the company an “overweight” rating in a report on Monday, September 7th. Berenberg Bank restated a “buy” rating and issued a GBX 2,400 target price on shares of Softcat in a research note on Friday. Deutsche Bank Aktiengesellschaft cut Softcat to a “hold” rating and upped their price target for the stock from GBX 1,800 to GBX 2,140 in a report on Wednesday, August 26th. Finally, Jefferies Financial Group reiterated a “hold” rating and set a GBX 1,700 price objective on shares of Softcat in a research note on Wednesday. Four equities research analysts have rated the stock with a Buy rating, three have issued a Hold rating and one has assigned a Sell rating to the company’s stock. Based on data from MarketBeat, the stock currently has an average rating of “Hold” and a consensus price target of GBX 1,993.75.

More Softcat News

Here are the key news stories impacting Softcat this week:

• Positive Sentiment: Seven Softcat insiders, including CEO Graeme Watt and other directors, purchased a combined 12,432 shares at GBX 1,890 each, representing approximately £235,000. The coordinated buying may signal management confidence in the company’s valuation and outlook.
• Positive Sentiment: Berenberg reaffirmed its “buy” rating and maintained a GBX 2,400 price target, implying substantial potential upside from recent trading levels. Softcat analyst rating information
• Positive Sentiment: Recent management commentary highlighted continued growth opportunities in artificial intelligence and technology services, which could support longer-term demand. Softcat plc Earnings Call: Growth, Margins, and AI
• Neutral Sentiment: Softcat admitted 12,432 new ordinary shares to the London Stock Exchange following director subscriptions. The issuance increases the share count to roughly 215.7 million, modestly diluting existing shareholders but aligning directors with investors. Softcat Directors Subscribe to New Equity
• Neutral Sentiment: Jefferies reaffirmed its “hold” rating, indicating a more cautious view than Berenberg. Softcat Stock Rating Reaffirmed as Hold
• Negative Sentiment: Analysts are warning that Softcat could face a margin squeeze in its upcoming full-year results, potentially limiting profit growth even if revenue remains resilient. Softcat Stock Faces FY Results Margin Squeeze

About Softcat

Softcat plc operates as a value-added IT reseller and IT infrastructure solutions provider in the United Kingdom. The company advices, procures, designs, implements, and manages technology, such as software licensing, workplace technology, networking, security, and cloud and datacenter for businesses and public sector organizations. It also offers public cloud, collaboration, connectivity, data centre and private cloud, devices, and financial solution services. In addition, the company provides IT asset management, lifecycle solutions, modern management, security, software licensing, supply chain operation, and virtual desktop and application.