SPS Commerce closed on a $22.9 million acquisition of ToolBox Solutions on Jan. 5. Toronto-based ToolBox is a provider of point-of-sale analytics and category management software. The addition of ToolBox strengthens the Minneapolis-based SPS’ foothold within the convenience, grocery and drugstore market.
JMP Securities analyst Patrick Walravens in a Jan. 7 report said he likes the SPS acquisition and maintained his “outperform,” or buy rating on the company.
“We continue to like SPS Commerce as we believe it is a great example of a company that has proven its ability to: 1) sustain a target growth rate of 20-25 percent; 2) execute on its targets (it has achieved its numbers 22 quarters in a row); and 3) remain disciplined in its M&A strategy (we feel this acquisition fits squarely within that strategy),” the report said.
Analyst: There are more challenges ahead for Best Buy
In a research note published on Jan. 11, three days before Best Buy Co. released a drop-in same-store holiday sales year-over-year, analyst Michael Pachter from Wedbush Securities was predicting that the Richfield-based consumer electronics and appliances retailer would be “limping to the holiday finish line.”
Best Buy shares dropped almost 10 percent on Thursday after the chain reported a 1.4 percent drop in same-store sales during the critical nine-week holiday shopping season. Pachter believes, even with the issues, that Best Buy is benefiting from struggles from some traditional competitors.
“Best Buy has captured some market share from several environmental tailwinds. Among those are last year’s RadioShack bankruptcy, continuing troubles at competitor Sears, a pickup in housing starts and newfound disposable consumer income as a result of lower gasoline prices,” wrote Pachter. “However, we think that once the tailwinds subside, Best Buy faces continuing losses for the foreseeable future.”
Analyst keeps buy rating on St. Jude
St. Jude Medical pre-announced disappointing results for its fourth quarter, but Wedbush analyst Tao Levy maintained his buy rating of “outperform” in his market update after the news last week because of the Little Canada-based company’s $3.4 billion acquisition of Thoratec that closed in October.
“We have a positive opinion of the recently closed Thoratec acquisition, which allows St. Jude to enter a $1 billion market [of left ventricular assist and percutaneous heart pump devices], which is growing at a 10 percent year over year and fits well with its Heart Failure franchise.”