CDW CORP/DE (CDW)

US12514G1085 - Common Stock

235.49  +3.56 (+1.53%)

After market: 235.25 -0.24 (-0.1%)

Fundamental Rating

5

CDW gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 128 industry peers in the Electronic Equipment, Instruments & Components industry. CDW scores excellent on profitability, but there are some minor concerns on its financial health. CDW is valued correctly, but it does not seem to be growing.



8

1. Profitability

1.1 Basic Checks

In the past year CDW was profitable.
In the past year CDW had a positive cash flow from operations.
In the past 5 years CDW has always been profitable.
Each year in the past 5 years CDW had a positive operating cash flow.

1.2 Ratios

CDW has a better Return On Assets (8.26%) than 84.92% of its industry peers.
With an excellent Return On Equity value of 50.98%, CDW belongs to the best of the industry, outperforming 99.21% of the companies in the same industry.
With an excellent Return On Invested Capital value of 15.75%, CDW belongs to the best of the industry, outperforming 92.06% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for CDW is significantly above the industry average of 9.11%.
The last Return On Invested Capital (15.75%) for CDW is above the 3 year average (15.14%), which is a sign of increasing profitability.
Industry RankSector Rank
ROA 8.26%
ROE 50.98%
ROIC 15.75%
ROA(3y)8.1%
ROA(5y)8.39%
ROE(3y)87.9%
ROE(5y)80.26%
ROIC(3y)15.14%
ROIC(5y)16.16%

1.3 Margins

Looking at the Profit Margin, with a value of 5.16%, CDW is in the better half of the industry, outperforming 69.84% of the companies in the same industry.
CDW's Profit Margin has improved in the last couple of years.
With a decent Operating Margin value of 7.82%, CDW is doing good in the industry, outperforming 75.40% of the companies in the same industry.
In the last couple of years the Operating Margin of CDW has grown nicely.
Looking at the Gross Margin, with a value of 21.88%, CDW is doing worse than 61.11% of the companies in the same industry.
CDW's Gross Margin has improved in the last couple of years.
Industry RankSector Rank
OM 7.82%
PM (TTM) 5.16%
GM 21.88%
OM growth 3Y7.19%
OM growth 5Y5.29%
PM growth 3Y6.54%
PM growth 5Y5.47%
GM growth 3Y7.78%
GM growth 5Y5.48%

5

2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), CDW is creating value.
The number of shares outstanding for CDW has been reduced compared to 1 year ago.
The number of shares outstanding for CDW has been reduced compared to 5 years ago.
Compared to 1 year ago, CDW has an improved debt to assets ratio.

2.2 Solvency

An Altman-Z score of 3.68 indicates that CDW is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 3.68, CDW is in the better half of the industry, outperforming 65.08% of the companies in the same industry.
The Debt to FCF ratio of CDW is 3.69, which is a good value as it means it would take CDW, 3.69 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 3.69, CDW is in the better half of the industry, outperforming 62.70% of the companies in the same industry.
CDW has a Debt/Equity ratio of 2.35. This is a high value indicating a heavy dependency on external financing.
CDW has a worse Debt to Equity ratio (2.35) than 95.24% of its industry peers.
Industry RankSector Rank
Debt/Equity 2.35
Debt/FCF 3.69
Altman-Z 3.68
ROIC/WACC1.84
WACC8.56%

2.3 Liquidity

A Current Ratio of 1.26 indicates that CDW should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.26, CDW is doing worse than 83.33% of the companies in the same industry.
A Quick Ratio of 1.13 indicates that CDW should not have too much problems paying its short term obligations.
CDW's Quick ratio of 1.13 is on the low side compared to the rest of the industry. CDW is outperformed by 72.22% of its industry peers.
Industry RankSector Rank
Current Ratio 1.26
Quick Ratio 1.13

3

3. Growth

3.1 Past

CDW shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 1.56%.
The Earnings Per Share has been growing by 13.83% on average over the past years. This is quite good.
The Revenue has decreased by -7.67% in the past year.
The Revenue has been growing slightly by 5.65% on average over the past years.
EPS 1Y (TTM)1.56%
EPS 3Y14.45%
EPS 5Y13.83%
EPS Q2Q%-5.42%
Revenue 1Y (TTM)-7.67%
Revenue growth 3Y5%
Revenue growth 5Y5.65%
Sales Q2Q%-4.51%

3.2 Future

The Earnings Per Share is expected to grow by 8.12% on average over the next years. This is quite good.
Based on estimates for the next years, CDW will show a small growth in Revenue. The Revenue will grow by 4.40% on average per year.
EPS Next Y3.45%
EPS Next 2Y6.81%
EPS Next 3Y8.12%
EPS Next 5YN/A
Revenue Next Year0.23%
Revenue Next 2Y3.03%
Revenue Next 3Y4.4%
Revenue Next 5YN/A

3.3 Evolution

When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.

4

4. Valuation

4.1 Price/Earnings Ratio

The Price/Earnings ratio is 24.10, which indicates a rather expensive current valuation of CDW.
65.87% of the companies in the same industry are more expensive than CDW, based on the Price/Earnings ratio.
CDW is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 28.63, which is the current average of the S&P500 Index.
CDW is valuated rather expensively with a Price/Forward Earnings ratio of 20.89.
Based on the Price/Forward Earnings ratio, CDW is valued a bit cheaper than 61.11% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 20.22. CDW is around the same levels.
Industry RankSector Rank
PE 24.1
Fwd PE 20.89

4.2 Price Multiples

The rest of the industry has a similar Enterprise Value to EBITDA ratio as CDW.
72.22% of the companies in the same industry are more expensive than CDW, based on the Price/Free Cash Flow ratio.
Industry RankSector Rank
P/FCF 20.72
EV/EBITDA 18.74

4.3 Compensation for Growth

The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates CDW does not grow enough to justify the current Price/Earnings ratio.
CDW has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)6.99
PEG (5Y)1.74
EPS Next 2Y6.81%
EPS Next 3Y8.12%

6

5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 1.10%, CDW has a reasonable but not impressive dividend return.
CDW's Dividend Yield is rather good when compared to the industry average which is at 1.75. CDW pays more dividend than 88.89% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.39, CDW's dividend is way lower than the S&P500 average.
Industry RankSector Rank
Dividend Yield 1.1%

5.2 History

The dividend of CDW is nicely growing with an annual growth rate of 20.78%!
CDW has been paying a dividend for at least 10 years, so it has a reliable track record.
CDW has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)20.78%
Div Incr Years10
Div Non Decr Years10

5.3 Sustainability

29.80% of the earnings are spent on dividend by CDW. This is a low number and sustainable payout ratio.
CDW's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP29.8%
EPS Next 2Y6.81%
EPS Next 3Y8.12%

CDW CORP/DE

NASDAQ:CDW (6/21/2024, 7:00:02 PM)

After market: 235.25 -0.24 (-0.1%)

235.49

+3.56 (+1.53%)

Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryElectronic Equipment, Instruments & Components
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap31.65B
Analysts
Price Target
Dividend
Industry RankSector Rank
Dividend Yield 1.1%
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
Avg EPS beat(4)
Min EPS beat(4)
Max EPS beat(4)
EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
Avg Revenue beat(4)
Min Revenue beat(4)
Max Revenue beat(4)
Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
Avg Revenue beat(12)
Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
Industry RankSector Rank
PE 24.1
Fwd PE 20.89
P/S
P/FCF
P/OCF
P/B
P/tB
EV/EBITDA
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)6.99
PEG (5Y)1.74
Profitability
Industry RankSector Rank
ROA 8.26%
ROE 50.98%
ROCE
ROIC
ROICexc
ROICexgc
OM 7.82%
PM (TTM) 5.16%
GM 21.88%
FCFM
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover1.6
Health
Industry RankSector Rank
Debt/Equity 2.35
Debt/FCF
Debt/EBITDA
Cap/Depr
Cap/Sales
Interest Coverage
Cash Conversion
Profit Quality
Current Ratio 1.26
Quick Ratio 1.13
Altman-Z
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
High Growth Momentum
Growth
EPS 1Y (TTM)1.56%
EPS 3Y14.45%
EPS 5Y
EPS Q2Q%
EPS Next Y3.45%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-7.67%
Revenue growth 3Y5%
Revenue growth 5Y
Sales Q2Q%
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y