CDW CORP/DE (CDW) Stock Fundamental Analysis
NASDAQ:CDW - Nasdaq - US12514G1085 - Common Stock - Currency: USD
Taking everything into account, CDW scores 6 out of 10 in our fundamental rating. CDW was compared to 125 industry peers in the Electronic Equipment, Instruments & Components industry. While CDW belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. CDW has a valuation in line with the averages, but it does not seem to be growing.
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.
CDW had positive earnings in each of the past 5 years.
In the past 5 years CDW always reported a positive cash flow from operatings.
1.2 Ratios
With an excellent Return On Assets value of 7.34%, CDW belongs to the best of the industry, outperforming 86.40% of the companies in the same industry.
CDW has a better Return On Equity (45.81%) than 99.20% of its industry peers.
With an excellent Return On Invested Capital value of 13.57%, CDW belongs to the best of the industry, outperforming 89.60% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for CDW is significantly above the industry average of 9.29%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.34% | ||
| ROE | 45.81% | ||
| ROIC | 13.57% |
ROA(3y)8.05%
ROA(5y)8.02%
ROE(3y)56.48%
ROE(5y)74.07%
ROIC(3y)15.27%
ROIC(5y)15.08%
1.3 Margins
With a decent Profit Margin value of 5.13%, CDW is doing good in the industry, outperforming 72.80% of the companies in the same industry.
CDW's Profit Margin has improved in the last couple of years.
The Operating Margin of CDW (7.86%) is better than 76.80% of its industry peers.
In the last couple of years the Operating Margin of CDW has grown nicely.
CDW has a Gross Margin of 21.92%. This is in the lower half of the industry: CDW underperforms 60.80% of its industry peers.
In the last couple of years the Gross Margin of CDW has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.86% | ||
| PM (TTM) | 5.13% | ||
| GM | 21.92% |
OM growth 3Y4.89%
OM growth 5Y4.57%
PM growth 3Y2.62%
PM growth 5Y4.66%
GM growth 3Y8.54%
GM growth 5Y5.39%
2. Health
2.1 Basic Checks
CDW has a Return on Invested Capital (ROIC), which is well above the Cost of Capital (WACC), which means it is creating value.
Compared to 1 year ago, CDW has less shares outstanding
CDW has less shares outstanding than it did 5 years ago.
The debt/assets ratio for CDW has been reduced compared to a year ago.
2.2 Solvency
CDW has an Altman-Z score of 2.86. This is not the best score and indicates that CDW is in the grey zone with still only limited risk for bankruptcy at the moment.
The Altman-Z score of CDW (2.86) is comparable to the rest of the industry.
The Debt to FCF ratio of CDW is 5.06, which is a neutral value as it means it would take CDW, 5.06 years of fcf income to pay off all of its debts.
CDW has a Debt to FCF ratio of 5.06. This is in the better half of the industry: CDW outperforms 60.80% of its industry peers.
CDW has a Debt/Equity ratio of 2.38. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 2.38, CDW is not doing good in the industry: 94.40% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.38 | ||
| Debt/FCF | 5.06 | ||
| Altman-Z | 2.86 |
ROIC/WACC1.7
WACC7.96%
2.3 Liquidity
A Current Ratio of 1.35 indicates that CDW should not have too much problems paying its short term obligations.
With a Current ratio value of 1.35, CDW is not doing good in the industry: 80.80% of the companies in the same industry are doing better.
A Quick Ratio of 1.24 indicates that CDW should not have too much problems paying its short term obligations.
With a Quick ratio value of 1.24, CDW is not doing good in the industry: 67.20% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.35 | ||
| Quick Ratio | 1.24 |
3. Growth
3.1 Past
CDW shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -3.54%.
The Earnings Per Share has been growing by 9.30% on average over the past years. This is quite good.
CDW shows a decrease in Revenue. In the last year, the revenue decreased by -1.77%.
CDW shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 3.09% yearly.
EPS 1Y (TTM)-3.54%
EPS 3Y6.14%
EPS 5Y9.3%
EPS Q2Q%-3.5%
Revenue 1Y (TTM)-1.77%
Revenue growth 3Y0.28%
Revenue growth 5Y3.09%
Sales Q2Q%3.34%
3.2 Future
CDW is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 5.55% yearly.
Based on estimates for the next years, CDW will show a small growth in Revenue. The Revenue will grow by 3.57% on average per year.
EPS Next Y1.57%
EPS Next 2Y4.54%
EPS Next 3Y5.55%
EPS Next 5YN/A
Revenue Next Year2.48%
Revenue Next 2Y3.5%
Revenue Next 3Y3.57%
Revenue Next 5YN/A
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is stable.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 16.85, the valuation of CDW can be described as correct.
CDW's Price/Earnings ratio is a bit cheaper when compared to the industry. CDW is cheaper than 79.20% of the companies in the same industry.
CDW's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 28.88.
Based on the Price/Forward Earnings ratio of 16.59, the valuation of CDW can be described as correct.
Based on the Price/Forward Earnings ratio, CDW is valued a bit cheaper than the industry average as 72.00% of the companies are valued more expensively.
CDW's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.20.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.85 | ||
| Fwd PE | 16.59 |
4.2 Price Multiples
68.00% of the companies in the same industry are more expensive than CDW, based on the Enterprise Value to EBITDA ratio.
CDW's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. CDW is cheaper than 75.20% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.32 | ||
| EV/EBITDA | 13.49 |
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.
The excellent profitability rating of CDW may justify a higher PE ratio.
PEG (NY)10.73
PEG (5Y)1.81
EPS Next 2Y4.54%
EPS Next 3Y5.55%
5. Dividend
5.1 Amount
CDW has a Yearly Dividend Yield of 1.57%.
Compared to an average industry Dividend Yield of 2.26, CDW pays a better dividend. On top of this CDW pays more dividend than 88.80% of the companies listed in the same industry.
CDW's Dividend Yield is slightly below the S&P500 average, which is at 2.45.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.57% |
5.2 History
The dividend of CDW is nicely growing with an annual growth rate of 14.59%!
CDW has paid a dividend for at least 10 years, which is a reliable track record.
CDW has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)14.59%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
CDW pays out 30.81% of its income as dividend. This is a sustainable payout ratio.
CDW's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP30.81%
EPS Next 2Y4.54%
EPS Next 3Y5.55%
160.56
+0.6 (+0.38%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryElectronic Equipment, Instruments & Components
Earnings (Last)
Earnings (Next)
Inst Owners95.06%
Inst Owner Change0.56%
Ins Owners0.2%
Ins Owner Change6.27%
Market Cap21.16B
Analysts75.29
Price Target216.92 (35.1%)
Short Float %2.06%
Short Ratio1.79
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.57% |
Yearly Dividend2.49
Dividend Growth(5Y)14.59%
DP30.81%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.56%
Min EPS beat(2)-8.79%
Max EPS beat(2)5.67%
EPS beat(4)1
Avg EPS beat(4)-4.2%
Min EPS beat(4)-11.53%
Max EPS beat(4)5.67%
EPS beat(8)4
Avg EPS beat(8)-0.59%
EPS beat(12)7
Avg EPS beat(12)0.58%
EPS beat(16)11
Avg EPS beat(16)2.52%
Revenue beat(2)1
Avg Revenue beat(2)-0.42%
Min Revenue beat(2)-4.49%
Max Revenue beat(2)3.66%
Revenue beat(4)1
Avg Revenue beat(4)-1.35%
Min Revenue beat(4)-4.49%
Max Revenue beat(4)3.66%
Revenue beat(8)2
Avg Revenue beat(8)-1.8%
Revenue beat(12)3
Avg Revenue beat(12)-2.2%
Revenue beat(16)6
Avg Revenue beat(16)-1.03%
PT rev (1m)-6.86%
PT rev (3m)-4.96%
EPS NQ rev (1m)0.01%
EPS NQ rev (3m)-4.74%
EPS NY rev (1m)-1.82%
EPS NY rev (3m)-5.71%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.28%
Revenue NY rev (1m)-1.03%
Revenue NY rev (3m)-0.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.85 | ||
| Fwd PE | 16.59 | ||
| P/S | 1.01 | ||
| P/FCF | 18.32 | ||
| P/OCF | 16.56 | ||
| P/B | 8.99 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.49 |
EPS(TTM)9.53
EY5.94%
EPS(NY)9.68
Fwd EY6.03%
FCF(TTM)8.76
FCFY5.46%
OCF(TTM)9.69
OCFY6.04%
SpS159.36
BVpS17.85
TBVpS-27.5
PEG (NY)10.73
PEG (5Y)1.81
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.34% | ||
| ROE | 45.81% | ||
| ROCE | 17.94% | ||
| ROIC | 13.57% | ||
| ROICexc | 14.71% | ||
| ROICexgc | 49.76% | ||
| OM | 7.86% | ||
| PM (TTM) | 5.13% | ||
| GM | 21.92% | ||
| FCFM | 5.5% |
ROA(3y)8.05%
ROA(5y)8.02%
ROE(3y)56.48%
ROE(5y)74.07%
ROIC(3y)15.27%
ROIC(5y)15.08%
ROICexc(3y)16.3%
ROICexc(5y)16.93%
ROICexgc(3y)66.87%
ROICexgc(5y)69.73%
ROCE(3y)20.19%
ROCE(5y)19.95%
ROICexcg growth 3Y-5.25%
ROICexcg growth 5Y-6.87%
ROICexc growth 3Y2.46%
ROICexc growth 5Y-5.66%
OM growth 3Y4.89%
OM growth 5Y4.57%
PM growth 3Y2.62%
PM growth 5Y4.66%
GM growth 3Y8.54%
GM growth 5Y5.39%
F-Score6
Asset Turnover1.43
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.38 | ||
| Debt/FCF | 5.06 | ||
| Debt/EBITDA | 2.91 | ||
| Cap/Depr | 44.53% | ||
| Cap/Sales | 0.58% | ||
| Interest Coverage | 7.59 | ||
| Cash Conversion | 66.3% | ||
| Profit Quality | 107.14% | ||
| Current Ratio | 1.35 | ||
| Quick Ratio | 1.24 | ||
| Altman-Z | 2.86 |
F-Score6
WACC7.96%
ROIC/WACC1.7
Cap/Depr(3y)47.75%
Cap/Depr(5y)46.54%
Cap/Sales(3y)0.61%
Cap/Sales(5y)0.63%
Profit Quality(3y)115.61%
Profit Quality(5y)112.52%
High Growth Momentum
Growth
EPS 1Y (TTM)-3.54%
EPS 3Y6.14%
EPS 5Y9.3%
EPS Q2Q%-3.5%
EPS Next Y1.57%
EPS Next 2Y4.54%
EPS Next 3Y5.55%
EPS Next 5YN/A
Revenue 1Y (TTM)-1.77%
Revenue growth 3Y0.28%
Revenue growth 5Y3.09%
Sales Q2Q%3.34%
Revenue Next Year2.48%
Revenue Next 2Y3.5%
Revenue Next 3Y3.57%
Revenue Next 5YN/A
EBIT growth 1Y-1.76%
EBIT growth 3Y5.18%
EBIT growth 5Y7.81%
EBIT Next Year11.07%
EBIT Next 3Y7.87%
EBIT Next 5YN/A
FCF growth 1Y-20.39%
FCF growth 3Y19.04%
FCF growth 5Y7.86%
OCF growth 1Y-20.1%
OCF growth 3Y17.64%
OCF growth 5Y4.45%