Softcat (LON:SCT) Releases Quarterly Earnings Results

Softcat (LON:SCT) posted its quarterly earnings data on Wednesday. The company reported GBX 75.80 EPS for the quarter, Digital Look Earnings reports. Softcat had a net margin of 8.06% and a return on equity of 45.16%.

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 Trading Down 1.3%

Shares of Softcat stock opened at GBX 1,697 on Thursday. The company has a debt-to-equity ratio of 13.07, a quick ratio of 1.38 and a current ratio of 1.25. Softcat has a fifty-two week low of GBX 1,083 and a fifty-two week high of GBX 2,134. The firm has a 50-day simple moving average of GBX 1,940.87 and a two-hundred day simple moving average of GBX 1,739.06. The company has a market cap of £3.65 billion, a P/E ratio of 24.21, a price-to-earnings-growth ratio of 11.51 and a beta of 0.58.

More Softcat News

Here are the key news stories impacting Softcat this week:

• Positive Sentiment: Strong fiscal 2026 performance: Softcat reported a 35.4% increase in revenue and a 19.4% rise in profit for the year ended July 31, 2026. The company also raised its dividend, supporting the income case for investors. Softcat FY2026 profits rise 19.4% as revenue grows 35.4%
• Positive Sentiment: U.S. expansion: Softcat announced a deal involving GDT, marking progress in its strategy to enter and build a presence in the U.S. market. This could provide an additional long-term growth opportunity, although near-term financial benefits remain uncertain. Softcat posts double-digit profit growth and moves into U.S. market with GDT deal
• Positive Sentiment: Director participation: All directors agreed to subscribe for 12,432 new ordinary shares, lifting the total share count to approximately 215.7 million. The purchases signal management confidence, though the limited issuance creates only a small dilution effect. Softcat Directors Subscribe to New Equity, Lifting Share Count to 215.7 Million
• Neutral Sentiment: Analyst stance remains cautious: Jefferies reaffirmed its “hold” rating and set a GBX 1,700 price target, indicating limited conviction that the recent results justify a higher valuation. Softcat lifts dividend as profit growth beats expectations
• Negative Sentiment: Slower forward growth is driving the weakness: Although results beat expectations, fiscal 2027 guidance points to a deceleration in growth. Investors are reacting to the reduced near-term earnings momentum, particularly given Softcat’s relatively elevated valuation. Softcat shares fall as outlook points to slower growth

Insider Buying and Selling

In other news, insider Graham Charlton acquired 176 shares of the business’s stock in a transaction that occurred on Monday, September 7th. The shares were purchased at an average price of GBX 2,045 per share, for a total transaction of £3,599.20. Also, insider Kathryn Mecklenburgh bought 176 shares of the firm’s stock in a transaction that occurred on Monday, September 7th. The shares were purchased at an average cost of GBX 2,045 per share, for a total transaction of £3,599.20. Insiders bought 384 shares of company stock valued at $749,739 over the last 90 days. Company insiders own 2.91% of the company’s stock.

Analyst Upgrades and Downgrades

A number of research analysts have recently weighed in on SCT shares. JPMorgan Chase & Co. increased their price objective on Softcat from GBX 1,950 to GBX 2,300 and gave the company an “overweight” rating in a report on Monday, September 7th. Jefferies Financial Group reaffirmed a “hold” rating and issued a GBX 1,700 price objective on shares of Softcat in a report on Wednesday. Berenberg Bank increased their price objective on shares of Softcat from GBX 1,950 to GBX 2,400 and gave the stock a “buy” rating in a research note on Monday, September 21st. Finally, Deutsche Bank Aktiengesellschaft cut shares of Softcat to a “hold” rating and raised their target price for the stock from GBX 1,800 to GBX 2,140 in a report on Wednesday, August 26th. Four equities research analysts have rated the stock with a Buy rating, three have issued a Hold rating and one has given a Sell rating to the stock. According to data from MarketBeat, Softcat presently has a consensus rating of “Hold” and an average target price of GBX 1,993.75.

Softcat Company Profile

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.