126 USD
-3.31 (-2.56%)
126 USD
0 (0%)
We assign a fundamental rating of 6 out of 10 to CDW. CDW was compared to 124 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 scores decently on growth, while it is valued quite cheap. This could make an interesting combination. CDW also has an excellent dividend rating.
1. Profitability
1.1 Basic Checks
- In the past year CDW was profitable.
- CDW had a positive operating cash flow in the past year.
- CDW had positive earnings in each of the past 5 years.
- CDW had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
- The Return On Assets of CDW (6.92%) is better than 84.68% of its industry peers.
- With an excellent Return On Equity value of 41.39%, CDW belongs to the best of the industry, outperforming 98.39% of the companies in the same industry.
- The Return On Invested Capital of CDW (12.86%) is better than 89.52% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for CDW is significantly above the industry average of 8.83%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 6.92% | ||
| ROE | 41.39% | ||
| ROIC | 12.86% |
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
- CDW's Profit Margin of 4.76% is fine compared to the rest of the industry. CDW outperforms 67.74% of its industry peers.
- In the last couple of years the Profit Margin of CDW has grown nicely.
- With a decent Operating Margin value of 7.39%, CDW is doing good in the industry, outperforming 71.77% of the companies in the same industry.
- In the last couple of years the Operating Margin of CDW has grown nicely.
- CDW has a Gross Margin of 21.60%. This is in the lower half of the industry: CDW underperforms 63.71% of its industry peers.
- In the last couple of years the Gross Margin of CDW has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 7.39% | ||
| PM (TTM) | 4.76% | ||
| GM | 21.6% |
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 just above the Cost of Capital (WACC), which means it is creating some value.
- CDW has less shares outstanding than it did 1 year ago.
- CDW has less shares outstanding than it did 5 years ago.
- CDW has a better debt/assets ratio than last year.
2.2 Solvency
- An Altman-Z score of 2.66 indicates that CDW is not a great score, but indicates only limited risk for bankruptcy at the moment.
- With a Altman-Z score value of 2.66, CDW is not doing good in the industry: 62.90% of the companies in the same industry are doing better.
- The Debt to FCF ratio of CDW is 5.58, which is a neutral value as it means it would take CDW, 5.58 years of fcf income to pay off all of its debts.
- CDW has a Debt to FCF ratio (5.58) which is in line with its industry peers.
- CDW has a Debt/Equity ratio of 2.21. This is a high value indicating a heavy dependency on external financing.
- CDW's Debt to Equity ratio of 2.21 is on the low side compared to the rest of the industry. CDW is outperformed by 92.74% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.21 | ||
| Debt/FCF | 5.58 | ||
| Altman-Z | 2.66 |
ROIC/WACC1.03
WACC12.48%
2.3 Liquidity
- A Current Ratio of 1.39 indicates that CDW should not have too much problems paying its short term obligations.
- CDW's Current ratio of 1.39 is on the low side compared to the rest of the industry. CDW is outperformed by 78.23% of its industry peers.
- A Quick Ratio of 1.30 indicates that CDW should not have too much problems paying its short term obligations.
- CDW's Quick ratio of 1.30 is on the low side compared to the rest of the industry. CDW is outperformed by 62.90% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.39 | ||
| Quick Ratio | 1.3 |
3. Growth
3.1 Past
- CDW shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 3.33%.
- CDW shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.30% yearly.
- CDW shows a small growth in Revenue. In the last year, the Revenue has grown by 6.09%.
- Measured over the past years, CDW shows a small growth in Revenue. The Revenue has been growing by 3.09% on average per year.
EPS 1Y (TTM)3.33%
EPS 3Y6.14%
EPS 5Y9.3%
EPS Q2Q%3.04%
Revenue 1Y (TTM)6.09%
Revenue growth 3Y0.28%
Revenue growth 5Y3.09%
Sales Q2Q%4%
3.2 Future
- CDW is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 6.47% yearly.
- Based on estimates for the next years, CDW will show a small growth in Revenue. The Revenue will grow by 4.61% on average per year.
EPS Next Y4.8%
EPS Next 2Y5.83%
EPS Next 3Y6.47%
EPS Next 5YN/A
Revenue Next Year6.59%
Revenue Next 2Y4.7%
Revenue Next 3Y4.61%
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 accelerating.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 12.68, CDW is valued correctly.
- Based on the Price/Earnings ratio, CDW is valued cheaper than 88.71% of the companies in the same industry.
- When comparing the Price/Earnings ratio of CDW to the average of the S&P500 Index (27.21), we can say CDW is valued rather cheaply.
- A Price/Forward Earnings ratio of 11.80 indicates a reasonable valuation of CDW.
- Based on the Price/Forward Earnings ratio, CDW is valued cheaper than 89.52% of the companies in the same industry.
- CDW is valuated cheaply when we compare the Price/Forward Earnings ratio to 24.26, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.68 | ||
| Fwd PE | 11.8 |
4.2 Price Multiples
- 84.68% of the companies in the same industry are more expensive than CDW, based on the Enterprise Value to EBITDA ratio.
- Based on the Price/Free Cash Flow ratio, CDW is valued cheaply inside the industry as 87.90% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.26 | ||
| EV/EBITDA | 11.44 |
4.3 Compensation for Growth
- The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
- CDW has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)2.64
PEG (5Y)1.36
EPS Next 2Y5.83%
EPS Next 3Y6.47%
5. Dividend
5.1 Amount
- CDW has a Yearly Dividend Yield of 1.95%.
- In the last 3 months the price of CDW has falen by -20.33%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
- CDW's Dividend Yield is rather good when compared to the industry average which is at 0.45. CDW pays more dividend than 94.35% of the companies in the same industry.
- Compared to an average S&P500 Dividend Yield of 1.81, CDW has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.95% |
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 its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)14.59%
Div Incr Years11
Div Non Decr Years11
5.3 Sustainability
- 31.39% of the earnings are spent on dividend by CDW. This is a low number and sustainable payout ratio.
- The dividend of CDW is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP31.39%
EPS Next 2Y5.83%
EPS Next 3Y6.47%
CDW CORP/DE / CDW FAQ
Can you provide the ChartMill fundamental rating for CDW CORP/DE?
ChartMill assigns a fundamental rating of 6 / 10 to CDW.
What is the valuation status for CDW stock?
ChartMill assigns a valuation rating of 7 / 10 to CDW CORP/DE (CDW). This can be considered as Undervalued.
How profitable is CDW CORP/DE (CDW) stock?
CDW CORP/DE (CDW) has a profitability rating of 8 / 10.
What are the PE and PB ratios of CDW CORP/DE (CDW) stock?
The Price/Earnings (PE) ratio for CDW CORP/DE (CDW) is 12.68 and the Price/Book (PB) ratio is 6.46.
Is the dividend of CDW CORP/DE sustainable?
The dividend rating of CDW CORP/DE (CDW) is 7 / 10 and the dividend payout ratio is 31.39%.