Key Highlights

  • Shares fell 6.38% pre-market to $25.26 from a $26.98 close.
  • Principal stockholder priced 11 million shares at $25.90, with a 1.65 million share option.
  • Company will repurchase 1 million shares from the underwriter using cash on hand.

Ingram Micro (NYSE:INGM) shares fell 6.38% in pre-market trading on Tuesday to $25.26, from a Monday close of $26.98. The stock had already dropped 5.00% in the prior session.

Ingram Micro is an Irvine, California distributor and services provider that sits between IT vendors and resellers, integrators and managed service providers worldwide. It has about 22,200 employees.

Concurrent Repurchase Offsets Part of the Share Overhang

An affiliate of Platinum Equity priced a secondary offering of 11 million shares at $25.90 per share. The seller also granted the underwriter a 30-day option for up to 1.65 million more shares. The company is not selling shares and will not receive proceeds.

The company authorized a concurrent repurchase of 1 million shares from the underwriter at the same price, to be funded with cash on hand. Goldman Sachs is the sole underwriter, and the offering is expected to settle on or about Nov. 4.

Record Q3 and Above-Consensus Outlook Frame the Move

The weakness follows a record third quarter. Net sales were $15.22 billion, up 20.8%, and adjusted EPS was $0.91 against $0.78 expected. The fourth quarter outlook came in above consensus, driven by AI infrastructure and cloud demand.

Valuation Context After a Second Day of Declines

At $25.26, the shares trade below the $25.90 offering price, about 20% under the 52-week high of $31.69 and about 33% above the 52-week low of $19.03. Market Capitalization is about $6.21 billion. The data shows a forward price-to-earnings ratio of 7.21, a trailing ratio of 13.56 and a Dividend Yield of 1.23%.

Offering Settlement and Option Exercise to Watch

Investors will watch the Nov. 4 settlement and whether the 30-day option is exercised, which would add up to 1.65 million shares for sale by the stockholder. The company's filings carry the full risk factors.