CDW (CDW) AI Stock Analysis

• Market Cap: $21.45B
• Dividend Yield: 1.51%
• Average Volume (3M): 1.13M
• Price to Earnings (P/E): 20.3
• Beta (1Y): 1.13
• Revenue Growth: 4.47%
• EPS Growth: -1.84%
• Country: US
• Employees: 15,100
• Sector: Technology
• Sector Strength: 86
• Industry: Information Technology Services
• EPS (TTM): 2.60
• Shares Outstanding: 131,060,750
• 10 Day Avg. Volume: 1,164,014
• 30 Day Avg. Volume: 1,127,828
• PEG Ratio: N/A
• Price to Book (P/B): N/A
• Price to Sales (P/S): N/A
• P/FCF Ratio: N/A
• Enterprise Value/Market Cap: 1.37
• Enterprise Value/Revenue: 1.34
• Enterprise Value/Gross Profit: 6.22
• Enterprise Value/Ebitda: 14.98
• 1Y Price Target: $199.67
• Price Target Upside: 20.38% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 7

• Rating: 66 Neutral
• Price Target: $179.00 ▲(7.92% Upside)

CDW's overall stock score reflects strong financial performance and positive earnings call highlights, particularly in key growth segments. However, technical analysis indicates bearish momentum, and valuation metrics suggest the stock may be overvalued, balancing the overall score.

Positive Factors

Financial Performance

CDW reported second-quarter results that handily beat consensus estimates on the top and bottom lines.

Market Position

CDW is positioned positively with advanced solutions in AI, data analytics, advanced networking, cloud solutions, and cybersecurity.

Negative Factors

Government Revenue

There is modestly higher risk to government segment revenue in the near term, as well as increased headline risk potential until issues with the GSA are resolved.

Macroeconomic Environment

Uncertainty in the macro environment and geopolitical factors might impact enterprise spending and recovery pace.

CDW Business Overview & Revenue Model

Company Description

CDW Corporation provides information technology (IT) solutions in the United States, the United Kingdom, and Canada. It operates through three segments: Corporate, Small Business, and Public. The company offers discrete hardware and software products and services, as well as integrated IT solutions, including on-premise, hybrid, and cloud capabilities across data center and networking, digital workspace, and security. Its hardware products comprise notebooks/mobile devices, network communications, desktop computers, video monitors, enterprise and data storage, and others; and software products consists of application suites, security, virtualization, operating systems, and network management. The company also provides advisory and design, software development, implementation, managed, professional, configuration, and telecom services, as well as warranties; mission critical software, systems, and network solutions; and implementation and installation, and repair services to its customers through various third-party service providers. It serves government, education, and healthcare customers; and small, medium, and large business customers. The company was founded in 1984 and is headquartered in Vernon Hills, Illinois.

How the Company Makes Money

CDW generates revenue primarily through the sale of technology products and services. Its revenue model is multifaceted, with key revenue streams including direct sales of hardware and software, professional services, and IT solutions. The company benefits from strong relationships with major technology vendors, allowing it to provide a comprehensive array of products at competitive prices. Additionally, CDW offers value-added services such as IT consulting, installation, and support, which further enhance its revenue potential. Strategic partnerships and alliances with leading technology providers bolster its offerings and enable CDW to tap into emerging trends in the technology sector, contributing significantly to its overall earnings.

CDW Financial Statement Overview

Summary

CDW demonstrates strong financial health with consistent profitability and efficient cash flow management, despite moderate revenue growth and a leveraged balance sheet. The company's strong return on equity and margin stability position it well in the competitive information technology services industry.

Income Statement

CDW shows strong profitability with a consistent gross profit margin around 21.8% and net profit margin near 5.1% over TTM. Revenue growth is moderate, with a slight decline from previous years, but profitability remains solid due to stable EBIT and EBITDA margins. The company's ability to maintain margins in a competitive industry highlights operational efficiency.

Balance Sheet

The balance sheet shows a moderate debt-to-equity ratio of 2.58, indicating a reliance on debt, though it's improving. Return on equity is strong at 46.8%, reflecting effective use of equity capital. The equity ratio is relatively low at 15.5%, suggesting a leveraged position, which poses potential risks but is common in the industry.

Cash Flow

CDW's cash flow is robust, with a positive free cash flow and a strong operating cash flow to net income ratio of 1.04, indicating efficient cash conversion. Free cash flow has slightly decreased, suggesting a need for attention, but overall cash generation remains healthy, supporting business operations and debt servicing.

Breakdown	TTM	Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement
Total Revenue	21.88B	21.00B	21.38B	23.75B	20.82B	18.47B
Gross Profit	4.72B	4.60B	4.65B	4.69B	3.57B	3.21B
EBITDA	1.96B	1.93B	1.95B	2.01B	1.64B	1.58B
Net Income	1.08B	1.08B	1.10B	1.11B	988.60M	788.50M
Balance Sheet
Total Assets	15.27B	14.68B	13.28B	13.13B	13.20B	9.34B
Cash, Cash Equivalents and Short-Term Investments	481.00M	717.70M	588.70M	315.20M	258.10M	1.41B
Total Debt	5.77B	5.99B	5.81B	6.10B	7.35B	4.57B
Total Liabilities	12.80B	12.33B	11.24B	11.53B	12.49B	8.05B
Stockholders Equity	2.47B	2.35B	2.04B	1.60B	705.70M	1.30B
Cash Flow
Free Cash Flow	1.02B	1.15B	1.45B	1.21B	684.60M	1.16B
Operating Cash Flow	1.13B	1.28B	1.60B	1.34B	784.60M	1.31B
Investing Cash Flow	-444.00M	-659.20M	-229.60M	-164.50M	-2.77B	-201.00M
Financing Cash Flow	-886.50M	-686.90M	-1.10B	-1.10B	832.80M	138.80M

CDW Technical Analysis

• Technical Analysis Sentiment: Neutral
• Last Price: 165.87
• 50DMA: Negative
• 100DMA: Negative
• 200DMA: Negative
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CDW, the sentiment is Neutral. The current price of 165.87 is above the 20-day moving average (MA) of 165.05, below the 50-day MA of 172.71, and below the 200-day MA of 174.41, indicating a neutral trend. The MACD of -2.21 indicates Negative momentum. The RSI at 46.00 is Neutral, neither overbought nor oversold. The STOCH value of 29.36 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Neutral sentiment for CDW.

CDW Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
LDOS	78 Outperform	$23.40B	17.24	30.76%	0.87%	6.53%	230.23%
EPAM	78 Outperform	$9.48B	24.75	11.36%	―	9.73%	-0.29%
IT	77 Outperform	$18.41B	15.15	116.13%	―	5.89%	54.53%
CTSH	74 Outperform	$35.01B	14.56	16.69%	1.72%	6.34%	12.16%
WIT	73 Outperform	$30.11B	20.93	16.50%	2.95%	-1.95%	62.75%
CDW	66 Neutral	$21.45B	20.35	46.39%	1.51%	4.47%	-1.84%
Sector *	61 Neutral	$36.05B	6.66	-10.10%	1.86%	8.68%	-8.81%

CDW Corporate Events

CDW Reports Strong Q2 2025 Earnings Growth

On August 6, 2025, CDW Corporation announced its second-quarter earnings for 2025, reporting a 10.2% increase in net sales compared to the same period in 2024, driven by heightened demand for notebooks, mobile devices, software, and data storage solutions. The company also declared a quarterly cash dividend of $0.625 per common share, reinforcing its commitment to returning cash to shareholders. Despite economic uncertainties, CDW’s diverse portfolio and strategic investments have positioned it to exceed US IT market growth, maintaining its role as a trusted advisor in the technology sector.

CDW Corporation Holds Annual Stockholders Meeting

On May 20, 2025, CDW Corporation held its Annual Meeting of Stockholders where several key decisions were made. Eleven directors were elected with terms expiring at the 2026 Annual Meeting, the compensation of the company’s named executive officers was approved, Ernst & Young LLP was ratified as the independent registered public accounting firm for 2025, and a proposal regarding stockholder rights to act by written consent was approved.