CDW CORP/DE (CDW) Stock Fundamental Analysis
NASDAQ:CDW - Nasdaq - US12514G1085 - Common Stock - Currency: USD
Taking everything into account, CDW scores 5 out of 10 in our fundamental rating. CDW was compared to 124 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 has a valuation in line with the averages, but on the other hand it scores bad on growth.
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.
Each year in the past 5 years CDW has been profitable.
CDW had a positive operating cash flow in 4 of the past 5 years.
1.2 Ratios
CDW has a better Return On Assets (7.72%) than 85.83% of its industry peers.
CDW has a better Return On Equity (47.24%) than 99.17% of its industry peers.
CDW has a Return On Invested Capital of 14.23%. This is amongst the best in the industry. CDW outperforms 90.83% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for CDW is significantly above the industry average of 8.95%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.72% | ||
| ROE | 47.24% | ||
| ROIC | 14.23% |
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 5.33%, CDW is doing good in the industry, outperforming 71.67% of the companies in the same industry.
CDW's Profit Margin has improved in the last couple of years.
CDW's Operating Margin of 8.05% is fine compared to the rest of the industry. CDW outperforms 75.83% of its industry peers.
CDW's Operating Margin has improved in the last couple of years.
CDW's Gross Margin of 22.09% is on the low side compared to the rest of the industry. CDW is outperformed by 63.33% of its industry peers.
CDW's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.05% | ||
| PM (TTM) | 5.33% | ||
| GM | 22.09% |
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
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), CDW is creating value.
Compared to 1 year ago, CDW has less shares outstanding
The number of shares outstanding for CDW has been reduced compared to 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 3.17. This indicates that CDW is financially healthy and has little risk of bankruptcy at the moment.
CDW has a Altman-Z score of 3.17. This is comparable to the rest of the industry: CDW outperforms 54.17% of its industry peers.
The Debt to FCF ratio of CDW is 4.50, which is a neutral value as it means it would take CDW, 4.50 years of fcf income to pay off all of its debts.
Looking at the Debt to FCF ratio, with a value of 4.50, CDW is in line with its industry, outperforming 56.67% of the companies in the same industry.
CDW has a Debt/Equity ratio of 2.39. This is a high value indicating a heavy dependency on external financing.
CDW's Debt to Equity ratio of 2.39 is on the low side compared to the rest of the industry. CDW is outperformed by 95.83% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.39 | ||
| Debt/FCF | 4.5 | ||
| Altman-Z | 3.17 |
ROIC/WACC1.75
WACC8.11%
2.3 Liquidity
CDW has a Current Ratio of 1.40. This is a normal value and indicates that CDW is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of CDW (1.40) is worse than 82.50% of its industry peers.
A Quick Ratio of 1.28 indicates that CDW should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.28, CDW is doing worse than 68.33% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.4 | ||
| Quick Ratio | 1.28 |
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%.
CDW shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.30% yearly.
Looking at the last year, CDW shows a decrease in Revenue. The Revenue has decreased by -1.77% in the last year.
The Revenue has been growing slightly by 3.09% on average over the past years.
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
The Earnings Per Share is expected to grow by 6.83% on average over the next years.
Based on estimates for the next years, CDW will show a small growth in Revenue. The Revenue will grow by 4.52% on average per year.
EPS Next Y3.46%
EPS Next 2Y5.7%
EPS Next 3Y6.83%
EPS Next 5YN/A
Revenue Next Year2.93%
Revenue Next 2Y4.52%
Revenue Next 3YN/A
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 accelerating: in the next years the growth will be better than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 19.57, which indicates a rather expensive current valuation of CDW.
Compared to the rest of the industry, the Price/Earnings ratio of CDW indicates a somewhat cheap valuation: CDW is cheaper than 77.50% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 29.63, CDW is valued a bit cheaper.
Based on the Price/Forward Earnings ratio of 18.92, the valuation of CDW can be described as rather expensive.
70.83% of the companies in the same industry are more expensive than CDW, based on the Price/Forward Earnings ratio.
CDW's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 22.68.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.57 | ||
| Fwd PE | 18.92 |
4.2 Price Multiples
65.83% 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 75.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.53 | ||
| EV/EBITDA | 15.55 |
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)5.66
PEG (5Y)2.1
EPS Next 2Y5.7%
EPS Next 3Y6.83%
5. Dividend
5.1 Amount
CDW has a Yearly Dividend Yield of 1.33%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.92, CDW pays a better dividend. On top of this CDW pays more dividend than 90.83% of the companies listed in the same industry.
With a Dividend Yield of 1.33, CDW pays less dividend than the S&P500 average, which is at 2.29.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.33% |
5.2 History
On average, the dividend of CDW grows each year by 20.78%, which is quite nice.
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 Years11
Div Non Decr Years11
5.3 Sustainability
CDW pays out 29.93% 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.
DP29.93%
EPS Next 2Y5.7%
EPS Next 3Y6.83%
186.5
-6.3 (-3.27%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryElectronic Equipment, Instruments & Components
Earnings (Last)
Earnings (Next)
Inst Owners97.26%
Inst Owner Change0.04%
Ins Owners0.2%
Ins Owner Change0.99%
Market Cap24.85B
Analysts75.29
Price Target226.46 (21.43%)
Short Float %2.39%
Short Ratio2.4
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.33% |
Yearly Dividend2.38
Dividend Growth(5Y)20.78%
DP29.93%
Div Incr Years11
Div Non Decr Years11
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-5.47%
Min EPS beat(2)-8.79%
Max EPS beat(2)-2.14%
EPS beat(4)0
Avg EPS beat(4)-5.77%
Min EPS beat(4)-11.53%
Max EPS beat(4)-0.6%
EPS beat(8)3
Avg EPS beat(8)-1.33%
EPS beat(12)7
Avg EPS beat(12)0.67%
EPS beat(16)11
Avg EPS beat(16)3.37%
Revenue beat(2)0
Avg Revenue beat(2)-2.75%
Min Revenue beat(2)-4.49%
Max Revenue beat(2)-1.01%
Revenue beat(4)0
Avg Revenue beat(4)-3.93%
Min Revenue beat(4)-6.67%
Max Revenue beat(4)-1.01%
Revenue beat(8)1
Avg Revenue beat(8)-3.87%
Revenue beat(12)3
Avg Revenue beat(12)-2.07%
Revenue beat(16)6
Avg Revenue beat(16)-0.52%
PT rev (1m)-0.78%
PT rev (3m)-10.63%
EPS NQ rev (1m)-0.18%
EPS NQ rev (3m)-0.18%
EPS NY rev (1m)-3.96%
EPS NY rev (3m)-3.58%
Revenue NQ rev (1m)-0.1%
Revenue NQ rev (3m)-0.1%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)0.4%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.57 | ||
| Fwd PE | 18.92 | ||
| P/S | 1.19 | ||
| P/FCF | 18.53 | ||
| P/OCF | 16.92 | ||
| P/B | 10.58 | ||
| P/tB | N/A | ||
| EV/EBITDA | 15.55 |
EPS(TTM)9.53
EY5.11%
EPS(NY)9.86
Fwd EY5.29%
FCF(TTM)10.06
FCFY5.4%
OCF(TTM)11.02
OCFY5.91%
SpS156.32
BVpS17.63
TBVpS-25.03
PEG (NY)5.66
PEG (5Y)2.1
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.72% | ||
| ROE | 47.24% | ||
| ROCE | 18.81% | ||
| ROIC | 14.23% | ||
| ROICexc | 16.35% | ||
| ROICexgc | 61.12% | ||
| OM | 8.05% | ||
| PM (TTM) | 5.33% | ||
| GM | 22.09% | ||
| FCFM | 6.44% |
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 Turnover1.45
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.39 | ||
| Debt/FCF | 4.5 | ||
| Debt/EBITDA | 2.87 | ||
| Cap/Depr | 46.55% | ||
| Cap/Sales | 0.61% | ||
| Interest Coverage | 7.02 | ||
| Cash Conversion | 75.25% | ||
| Profit Quality | 120.84% | ||
| Current Ratio | 1.4 | ||
| Quick Ratio | 1.28 | ||
| Altman-Z | 3.17 |
F-Score6
WACC8.11%
ROIC/WACC1.75
Cap/Depr(3y)N/A
Cap/Depr(5y)N/A
Cap/Sales(3y)N/A
Cap/Sales(5y)N/A
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-3.54%
EPS 3Y6.14%
EPS 5Y9.3%
EPS Q2Q%-3.5%
EPS Next Y3.46%
EPS Next 2Y5.7%
EPS Next 3Y6.83%
EPS Next 5YN/A
Revenue 1Y (TTM)-1.77%
Revenue growth 3Y0.28%
Revenue growth 5Y3.09%
Sales Q2Q%3.34%
Revenue Next Year2.93%
Revenue Next 2Y4.52%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y-0.87%
EBIT growth 3Y5.18%
EBIT growth 5Y7.81%
EBIT Next Year12.4%
EBIT Next 3YN/A
EBIT Next 5YN/A
FCF growth 1Y15.72%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y12.61%
OCF growth 3YN/A
OCF growth 5YN/A