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CDW
(NASDAQ:CDW)
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Rating:65Neutral
Price Target:
$157.00
▲(10.49% Upside)
Action:Reiterated
Date:09/22/26
CDW’s score is driven primarily by steady profitability and generally good cash earnings quality, supported by a positive earnings call with raised guidance and broad-based demand momentum. The main offset is balance-sheet risk (elevated leverage) combined with near-term cash-flow pressure from working-capital/inventory dynamics, while technicals and valuation read as broadly neutral-to-reasonable.
Positive Factors
Broad-based demand and market outperformance
Demand spans infrastructure, software, cloud and security across commercial, government and international customers, reducing reliance on one market. Management’s expectation of 200–300 basis points of market outperformance supports durable share gains and continued relevance as organizations modernize IT.
Negative Factors
Elevated leverage and increased debt exposure
Leverage remains the clearest structural constraint on CDW’s financial flexibility, because debt magnifies sensitivity to weaker demand, higher financing costs and refinancing needs. The additional senior notes increase long-term obligations, potentially limiting capital available for investment or shareholder returns.
Read all positive and negative factors
Positive Factors
Negative Factors
Broad-based demand and market outperformance
Demand spans infrastructure, software, cloud and security across commercial, government and international customers, reducing reliance on one market. Management’s expectation of 200–300 basis points of market outperformance supports durable share gains and continued relevance as organizations modernize IT.
Read all positive factors
CDW Key Performance Indicators (KPIs)
Any
Revenue by Geography
Shows where the company earns its revenue across different regions, with a heavy North American focus pointing to sensitivity to U.S. IT spending and any regional downturns. Tracking shifts over time flags successful international growth or rising exposure to new markets.
Shows where the company earns its revenue across different regions, with a heavy North American focus pointing to sensitivity to U.S. IT spending and any regional downturns. Tracking shifts over time flags successful international growth or rising exposure to new markets.
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The Fly
The FlyCDW (CDW) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$18.43B
Dividend Yield1.72%
Average Volume (3M)1.58M
Price to Earnings (P/E)17.5
Beta (1Y)0.95
Revenue Growth7.41%
EPS Growth3.00%
CountryUS
Employees14,800
SectorTechnology
Sector Strength88
IndustryInformation Technology Services
Share Statistics
EPS (TTM)8.35
Shares Outstanding125,017,426
10 Day Avg. Volume1,657,648
30 Day Avg. Volume1,583,360
Financial Highlights & Ratios
PEG Ratio19.29
Price to Book (P/B)6.86
Price to Sales (P/S)0.80
P/FCF Ratio16.44
Enterprise Value/Market Cap<0.01
Enterprise Value/Revenue<0.01
Enterprise Value/Gross Profit<0.01
Enterprise Value/Ebitda<0.01
Forecast
1Y Price Target
$159.67Price Target Upside12.37% Upside
Rating ConsensusModerate Buy
Number of Analyst Covering7
EPS Forecast (FY)10.95
Revenue Forecast (FY)$24.24B
CDW Business Overview & Revenue Model
Company Description
CDW Corporation specializes in delivering comprehensive information technology services and products across North America and the United Kingdom. It strategically targets three core client divisions: corporate enterprises, small to medium-sized bu...
How the Company Makes Money
CDW primarily makes money by selling third-party IT products and related services to customers, generating revenue mainly from product resale (with gross profit earned through distribution/reseller margins and vendor program incentives) and from s...
CDW Earnings Call Summary
Earnings Call Date:Aug 05, 2026
(Q2-2026)
| % Change Since: |
Next Earnings Date:Nov 04, 2026
Earnings Call Sentiment Positive
The call presents a largely positive operational and financial story: company delivered record quarterly revenue, gross profit and EPS driven by strong infrastructure, software, cloud and security demand, and raised its full-year outlook. Key strengths include diversified end markets, international momentum, improving expense discipline and pronounced AI-related opportunity across the full stack. Primary near-term risks are margin compression from product mix, muted services growth due to deployment timing, a temporary working capital build that depressed free cash flow conversion, and a modestly cautious near-term margin outlook. Management expects services tailwinds and cash conversion to normalize in the back half of the year.Positive Updates
Record Quarterly Financials
Net sales of $6.6B, up 10% YoY; gross profit of $1.3B, up 6.3% YoY; non-GAAP operating income of $556M, up 7% YoY; non-GAAP EPS of $2.91, up 11.9% YoY. Net sales, gross profit and non-GAAP EPS set all-time quarterly records.
Negative Updates
Gross Margin Compression
GAAP gross margin 20.1%, down 70 bps YoY. Management attributes margin decline to mix shift toward large hardware infrastructure deals and lower relative contribution from services.
Read all updates
Q2-2026 Updates
Positive
Negative
Record Quarterly Financials
Net sales of $6.6B, up 10% YoY; gross profit of $1.3B, up 6.3% YoY; non-GAAP operating income of $556M, up 7% YoY; non-GAAP EPS of $2.91, up 11.9% YoY. Net sales, gross profit and non-GAAP EPS set all-time quarterly records.
Read all positive updates
Company Guidance
CDW raised its full‑year outlook, forecasting full‑year gross profit growth in the mid‑single‑digits and full‑year non‑GAAP net income per diluted share growth at the high end of the high‑single‑digit range, with full‑year gross margin expected to be modestly below 2025 and second‑half gross margins below second‑half 2025 as seasonality shifts toward a more typical second‑half weighting; management expects the U.S. IT addressable market to grow mid‑single‑digits in 2026 with CDW outperformance of 200–300 basis points, sees currency as a slight benefit to reported growth, and provided Q3 modeling of gross profit up mid‑single‑digits year‑over‑year, non‑GAAP SG&A lower than Q2 (driving operating expense as a percent of gross profit down both year‑over‑year and sequentially) and Q3 non‑GAAP EPS growth at the high end of the high‑single‑digit range. Balance‑sheet and cash expectations include net debt of $5.5 billion, liquidity of $2.0 billion, a 3‑month average cash conversion cycle of 21 days (target: high‑teens to low‑20s), adjusted free cash flow year‑to‑date of $278 million (42% of non‑GAAP net income) with an expectation to normalize toward an 80–90% conversion rate in the back half, a targeted ~25% dividend payout ratio, net leverage of 2.5x (target 2.0–3.0x), and more than $1.1 billion of remaining share‑repurchase capacity.CDW Financial Statement Overview
Summary
Income Statement
72
Positive
Balance Sheet
52
Neutral
Cash Flow
64
Positive
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 23.50B | 22.42B | 21.00B | 21.38B | 23.75B | 20.82B |
| Gross Profit | 5.02B | 4.87B | 4.60B | 4.65B | 4.69B | 3.57B |
| EBITDA | 1.83B | 1.95B | 1.93B | 1.95B | 2.01B | 1.64B |
| Net Income | 1.08B | 1.07B | 1.08B | 1.10B | 1.11B | 988.60M |
Balance Sheet | ||||||
| Total Assets | 17.25B | 16.03B | 14.68B | 13.28B | 13.13B | 13.20B |
| Cash, Cash Equivalents and Short-Term Investments | 361.80M | 618.70M | 717.70M | 588.70M | 315.20M | 258.10M |
| Total Debt | 5.96B | 6.33B | 5.99B | 5.81B | 6.10B | 7.35B |
| Total Liabilities | 14.81B | 13.42B | 12.33B | 11.24B | 11.53B | 12.49B |
| Stockholders Equity | 2.44B | 2.61B | 2.35B | 2.04B | 1.60B | 705.70M |
Cash Flow | ||||||
| Free Cash Flow | 1.11B | 1.09B | 1.15B | 1.45B | 1.21B | 684.60M |
| Operating Cash Flow | 1.26B | 1.21B | 1.28B | 1.60B | 1.34B | 784.60M |
| Investing Cash Flow | -174.10M | 70.20M | -659.20M | -229.60M | -164.50M | -2.77B |
| Financing Cash Flow | -1.21B | -1.18B | -686.90M | -1.10B | -1.10B | 832.80M |
CDW Technical Analysis
Positive
142.09
Price Trends
141.61
Positive
133.15
Positive
130.92
Positive
Market Momentum
2.03
Positive
52.12
Neutral
40.85
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For CDW, the sentiment is Positive. The current price of 142.09 is below the 20-day moving average (MA) of 148.25, above the 50-day MA of 141.61, and above the 200-day MA of 130.92, indicating a neutral trend. The MACD of 2.03 indicates Positive momentum. The RSI at 52.12 is Neutral, neither overbought nor oversold. The STOCH value of 40.85 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for CDW.
CDW Risk Analysis
CDW disclosed 23 risk factors in its most recent earnings report. CDW reported the most risks in the "Production" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
CDW Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
76 Outperform | $26.43B | 12.69 | 14.94% | 2.20% | 5.64% | -5.39% | |
69 Neutral | $4.59B | 23.10 | 13.08% | ― | 2.68% | 46.40% | |
65 Neutral | $18.43B | 17.50 | 42.60% | 1.72% | 7.41% | 3.00% | |
65 Neutral | $217.99B | 20.33 | 33.52% | 2.90% | 7.90% | 82.11% | |
62 Neutral | $6.27B | 14.84 | 10.23% | 1.22% | 11.54% | 61.84% | |
61 Neutral | $37.18B | 12.37 | -10.20% | 1.83% | 8.50% | -7.62% | |
54 Neutral | $522.82M | 12.52 | 14.86% | ― | 11.10% | 10.19% |
* Technology Sector Average
CDW
CDW
146.16
-11.11
-7.06%
CTSH
Cognizant
59.14
-7.71
-11.53%
NSIT
Insight Enterprises
158.25
44.09
38.62%
IBM
International Business Machines
232.76
-27.99
-10.73%
VRRM
Verra Mobility
3.38
-20.98
-86.12%
INGM
Ingram Micro Holding Corporation
27.31
7.07
34.91%
CDW Corporate Events
Business Operations and StrategyPrivate Placements and Financing
CDW Completes $1.5 Billion Senior Notes Offering
Positive
Sep 21, 2026
On September 21, 2026, CDW LLC and CDW Finance Corporation completed a registered offering of $1.5 billion in senior unsecured notes, split among 5.700% notes due 2029, 6.100% notes due 2032, and 6.350% notes due 2033, with interest payments begin...
Private Placements and FinancingRegulatory Filings and Compliance
CDW announces $1.5 billion senior notes offering
Positive
Sep 15, 2026
On September 14, 2026, CDW LLC and CDW Finance Corporation, with CDW Corporation as guarantor, entered into an underwriting agreement with a syndicate led by BofA Securities, J.P. Morgan, Mizuho Securities USA, and Wells Fargo Securities. Under th...
Business Operations and StrategyExecutive/Board Changes
CDW Announces Planned CFO Retirement and Leadership Transition
Positive
Aug 5, 2026
On August 5, 2026, CDW announced that Chief Financial Officer Albert J. Miralles plans to retire in 2027 after an orderly transition, following notification to the company on August 3, 2026. Miralles will remain CFO until a successor is named, the...
Business Operations and StrategyDividendsFinancial Disclosures
CDW Posts Strong Q2 2026 Results, Raises Dividend
Positive
Aug 5, 2026
CDW reported its second-quarter 2026 results on August 5, 2026, posting net sales of $6.57 billion, up 10 percent year over year, driven by strong demand for data storage, servers, mobile devices, software, and networking products across commercia...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.