IT services provider on the up
Computacenter is one of Europe’s leading providers of IT infrastructure services. It helps businesses operate and reach their full potential through the use of IT and technology. With a presence in Europe, North America, Asia, and Africa, Computacenter is a global firm.
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Technology has evolved exponentially in the past decade or so. Computacenter has continued its impressive growth journey by staying in touch with the latest developments and providing the best solutions for its vast customer base.
As I write, shares in Computacenter are trading for 2,672p per share. A year ago, shares were trading for 2,330p which is a 14% return in 12 months. Most of the best stocks to buy now have offered a positive return in the past 12 months. In fact, Computacenter shares have surpassed pre-pandemic highs of 1,920p by some distance.
Why I like Computacenter
- Computacenter has an excellent track record of performance historically and recently. I understand that past performance is not a guarantee of the future but I use it as a gauge nevertheless. Looking back, I can see that Computacenter has recorded a year-on-year increase in revenue and gross profit for the past four years. This includes while trading during the pandemic, which did not affect it. A recent Q3 trading update for the quarter ending 30 September also saw trading recorded as “ahead of expectations.”
- Most of my best stocks to buy now make me a passive income. Computacenter is no different. Currently, it has a dividend yield of over 2%.
- Computacenter’s profile and reach across the world is impressive. With many locations strategically placed throughout the world, it has access to lots of markets which can only increase performance and in turn, its balance sheet. In addition, it is always on the lookout to open new locations and further its reach. It has a proven track record of consistently opening new locations in untapped markets.
Even the best stocks to buy now have risks
Computacenter has two main risks in my opinion. Firstly, the well-documented shortage in semiconductors will affect the supply chain of electronic products. Computacenter will be affected by this and it could affect performance. Next, competition in the IT services sector is rife. Many other firms are vying for market share and they are all vying for the same customers to sell their products and services too.
Overall I do believe Computacenter is one of the best stocks to buy now for my portfolio. It is well positioned to help businesses continue to achieve their digital transformation, which will boost its own growth and performance. It has a positive track record of performance and growth too.
I also believe Computacenter stock is cheap with a forward price-to-earnings ratio of just 17. In fact, UBS analysts last month predicted that the share price could go as high as 3,290p and have upgraded the stock to ‘buy.’