What happened?
Shares of IT solutions provider ePlus (NASDAQ: PLUS) jumped 4.4% in the afternoon session after investors continued to bid up the stock as the company reported second-quarter fiscal 2027 results and higher full-year guidance. According to the company's release, product sales rose 12.8% to $547.1 million on stronger cloud, security, and collaboration demand. Cash was $381 million. ePlus raised its fiscal 2027 outlook to upper-single-digit growth in net sales and gross profit, and low-double-digit growth in adjusted EBITDA.
After the initial pop, the shares cooled down to $95.52, up 3.7% from the previous close.
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What is the market telling us
ePlus’s shares are not very volatile and have only had 4 moves greater than 5% over the last year. In that context, today’s move indicates the market considers this news meaningful, although it might not be something that would fundamentally change its perception of the business.
The biggest move we wrote about over the last year was 5 months ago when the stock dropped 8% on the news that the company reported mixed first-quarter 2026 results where top- and bottom-line beats were overshadowed by declining profitability. The company posted adjusted earnings of $1.00 per share and revenue of $576.2 million, beating Wall Street's expectations on both fronts.
However, the positive results were tempered by underlying concerns about the company's cost structure. Adjusted EBITDA of $40.06 million missed analyst expectations by 4.3%, and the company's operating margin declined to 5.4% from 7% in the same quarter last year. This suggested that rising costs were pressuring profitability, a trend that appeared to worry investors more than the headline beats.
ePlus is up 10.2% since the beginning of the year, and at $95.52 per share, it is trading close to its 52-week high of $97.05 from August 2026. Investors who bought $1,000 worth of ePlus’s shares 5 years ago would now be looking at an investment worth $1,579.
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