Research on PLUS (PLUS) from Sidoti & Company
We expect memory shortages to be a headwind to revenue and earnings growth in F2027, but market demand for PLUS's services remains strong. With longer lead times, the demand PLUS is seeing is not currently translating to revenue, but the company is building a sizable backlog that will become a significant tailwind as memory constraints ease. ePlus ended 1Q:F27 with no debt and cash of $449 million ($17.22 per share), giving the company ample flexibility to invest organically, pursue additional tuck-in acquisitions, more actively buy back stock, and continue to increase its dividend. We maintain our $111 price target based on about 18x our F2028 EPS estimate of $6.09. Given the company's track record of profits and a debt-free balance sheet, we assign the stock a Moderate risk rating.
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