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1. Company Snapshot

1.a. Company Description

CDW Corporation provides information technology (IT) solutions in the United States, the United Kingdom, and Canada.It operates through three segments: Corporate, Small Business, and Public.The company offers discrete hardware and software products and services, as well as integrated IT solutions, including on-premise, hybrid, and cloud capabilities across data center and networking, digital workspace, and security.


Its hardware products comprise notebooks/mobile devices, network communications, desktop computers, video monitors, enterprise and data storage, and others; and software products consists of application suites, security, virtualization, operating systems, and network management.The company also provides advisory and design, software development, implementation, managed, professional, configuration, and telecom services, as well as warranties; mission critical software, systems, and network solutions; and implementation and installation, and repair services to its customers through various third-party service providers.It serves government, education, and healthcare customers; and small, medium, and large business customers.


The company was founded in 1984 and is headquartered in Vernon Hills, Illinois.

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1.b. Last Insights on CDW

CDW Corporation's recent performance faced challenges due to weak demand from government and education sectors, as guided by management. Despite Q4 2025 results exceeding expectations, near-term growth catalysts are lacking. Corporate segment weakness and uncertainty limited overall growth visibility. However, the company saw resilient demand for IT solutions, driven by artificial intelligence and cloud adoption. CDW also returned $982M to shareholders through share buybacks, a positive event that benefits existing shareholders. (Source: CDW Corp remains a hold - yet unknown)

1.c. Company Highlights

2. CDW Corporation Delivers Strong Q4 2025 Results

CDW Corporation reported net sales of $5.5 billion for the fourth quarter of 2025, representing a 5% increase year over year. Gross profit was $1.25 billion, up 9%, while non-GAAP operating income was $503 million, up 1%. Non-GAAP net income per share was $2.57, a 4% increase over 2024. The company's gross margin was 22.8%, up 50 basis points over the prior year's fourth quarter. For the full year 2025, CDW Corporation achieved net sales growth of 6.8%, gross profit growth of 5.9%, and non-GAAP net income per diluted share of over $10, an all-time record.

Publication Date: Feb -05

📋 Highlights
  • Q4 Net Sales & Gross Profit Growth:: Net sales reached $5.5 billion (+5%), with gross profit at $1.25 billion (+9%), showcasing strong financial performance.
  • Non-GAAP Earnings Resilience:: Non-GAAP net income per share rose to $2.57 (+4%), and non-GAAP operating income grew to $503 million (+1%), reflecting operational efficiency.
  • AI Expansion & Market Position:: CDW expanded AI offerings in strategy, data modernization, and automation, leveraging partnerships to address customer demand for scalable AI solutions.
  • 2026 Guidance & Shareholder Returns:: Targets 200–300 bps market outperformance with gross profit growth in low single digits, alongside returning 50–75% of adjusted free cash flow to shareholders.
  • Balance Sheet Strength:: Net debt reduced by $165 million to $5 billion, with liquidity of $2.5 billion (cash + revolver), and a cash conversion cycle of 16 days, underlining financial discipline.

Financial Highlights and Guidance

For 2026, CDW Corporation expects the US IT market to grow in the low single digits on a customer spend basis, with the company targeting 200 to 300 basis points of outperformance. The company anticipates gross profit to grow in low single digits for the full year, with non-GAAP net income per diluted share expected to grow mid-single digits year over year. CDW Corporation plans to return 50% to 75% of adjusted free cash flow to shareholders via dividend and share repurchases.

Valuation Metrics

With a P/E Ratio of 16.83 and an EV/EBITDA of 12.32, CDW Corporation's valuation appears reasonable considering its growth prospects. The company's ROE of 38.16% and ROIC of 12.61% indicate strong profitability. The Net Debt / EBITDA ratio of 2.75 suggests a manageable debt burden. The Dividend Yield of 1.81% and Free Cash Flow Yield of 5.61% provide a relatively attractive return for investors.

AI and IT Market Outlook

CDW Corporation is optimistic about its AI offerings, with partnership relationships with major players and a strong position in helping customers design, deploy, and operate AI environments. The company expects customers to allocate incremental dollars to AI solutions, with a slight increase in hardware spend as well. As Christine A. Leahy stated, "customers are moving into the production stage, and our expertise in integration and secured deployment of AI-enabled tech solutions makes us a trusted adviser."

Operational Efficiency and Expenses

CDW Corporation expects to optimize its fixed cost base and see progressive operating leverage throughout 2026. The company's non-GAAP SG&A expenses totaled $752 million in the fourth quarter, up 14.6% year over year, driven by commissions and higher performance-based expenses. Looking ahead, the company aims to sharpen efficiency and deploy capital with discipline.

3. NewsRoom

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CDW Corporation $CDW Shares Sold by Cardinal Capital Management Inc.

Apr -10

Source: defenseworld.net

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CDW Corporation (NASDAQ:CDW) Given Consensus Rating of “Moderate Buy” by Brokerages

Apr -06

Source: defenseworld.net

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Cyberattacks Targeting Canadian Enterprises Surge Nearly 80% Year Over Year

Apr -01

Source: businesswire.com

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Rep. April McClain Delaney Sells CDW Corporation (NASDAQ:CDW) Shares

Mar -12

Source: defenseworld.net

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Rep. April McClain Delaney Buys Rollins, Inc. (NYSE:ROL) Shares

Mar -12

Source: defenseworld.net

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Rep. April McClain Delaney Purchases Shares of C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW)

Mar -12

Source: defenseworld.net

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Rep. April McClain Delaney Sells The Middleby Corporation (NASDAQ:MIDD) Stock

Mar -12

Source: defenseworld.net

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Fortune Brands Innovations (NYSE:FBIN) Stock Unloaded Rep. April McClain Delaney

Mar -12

Source: defenseworld.net

4. Business Breakdown

4.a. Revenues by Country

4.b. Revenues by Segment

5. Expected revenues mid-term growth (8.39%)

6. Segments

Corporate (Excl. Small Business)

Expected Growth: 8.3%

Large corporate clients drive CDW's sales growth, fueled by increasing IT spending, digital transformation, and cybersecurity demands, as well as CDW's strong relationships and expertise in serving this segment.

Public

Expected Growth: 8.6%

Public sector clients, such as government agencies and education institutions, drive CDW’s growth, as they increasingly invest in digital transformation, cybersecurity, and cloud infrastructure to improve operational efficiency and citizen services.

Small Business

Expected Growth: 10.9%

Growing demand for digital solutions among small businesses drives CDW's growth, fueled by increasing adoption of cloud-based services, cybersecurity, and data analytics.

Other

Expected Growth: 6.5%

CDW Corporations’ Other segment growth is driven by increasing demand for cloud-based services, cybersecurity solutions, and digital transformation initiatives.

7. Detailed Products

Hardware Solutions

CDW Corporation offers a wide range of hardware solutions, including laptops, desktops, tablets, servers, storage devices, and networking equipment from top manufacturers such as Apple, Cisco, Dell, HP, and Lenovo.

Software Solutions

CDW Corporation provides a vast array of software solutions, including operating systems, productivity software, security software, and data management tools from leading vendors such as Microsoft, VMware, and Symantec.

Cloud Solutions

CDW Corporation provides cloud solutions, including infrastructure as a service (IaaS), platform as a service (PaaS), and software as a service (SaaS) offerings from top cloud providers such as Amazon Web Services (AWS), Microsoft Azure, and Google Cloud Platform (GCP).

Security Solutions

CDW Corporation offers a range of security solutions, including threat detection, vulnerability assessment, and incident response services, to help organizations protect themselves against cyber threats.

Networking Solutions

CDW Corporation provides networking solutions, including routers, switches, and firewalls, from leading manufacturers such as Cisco and Juniper.

Data Management Solutions

CDW Corporation offers data management solutions, including data storage, backup and recovery, and data analytics tools, to help organizations manage and make sense of their data.

Services

CDW Corporation provides a range of services, including consulting, implementation, and support services, to help organizations design, deploy, and manage their IT solutions.

8. CDW Corporation's Porter Forces

Forces Ranking

Threat Of Substitutes

The threat of substitutes is low due to the specialized nature of IT infrastructure needs. While cloud services or in-house solutions exist, they require significant upfront investment and expertise, making substitution challenging for most businesses.

Bargaining Power Of Customers

Large corporate clients, such as enterprises and government institutions, have strong bargaining power due to their high purchase volumes and reliance on CDW's expertise. They often negotiate pricing and service terms effectively.

Bargaining Power Of Suppliers

Suppliers like major tech manufacturers (e.g., Dell, HP) hold moderate power due to brand loyalty and product differentiation, but CDW’s scale allows it to negotiate favorable terms, balancing supplier influence.

Threat Of New Entrants

High barriers to entry, such as capital requirements, vendor certifications, and existing client relationships, limit new competitors. CDW’s established supplier partnerships and industry reputation deter newcomers.

Intensity Of Rivalry

The market is crowded with competitors like Tech Data and Ingram Micro, leading to aggressive pricing, service differentiation, and marketing efforts. This drives intense rivalry and margin pressure.

9. SWOT Analysis

Strength

Weaknesses

Opportunities

Threats

10. Capital Structure

10.a. Balance Sheet

10.b. Weighted Average Cost of capital

Value
Debt Weight 71.81%
Debt Cost 4.77%
Equity Weight 28.19%
Equity Cost 8.65%
WACC 5.86%
Leverage 254.68%

11. Quality Control: CDW Corporation passed 6 out of 9 key points

12.a Historical Valuation

12.b Price/Earnings Ratio

12.c Margin Valuation

12.d Peers Valuation

Peers Group Analysis

Stock-Card
Cognizant

A-Score: 5.7/10

Value: 4.9

Growth: 4.7

Quality: 7.6

Yield: 3.0

Momentum: 5.0

Volatility: 9.0

1-Year Total Return ->

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Stock-Card
IBM

A-Score: 5.7/10

Value: 1.8

Growth: 3.0

Quality: 6.0

Yield: 6.0

Momentum: 9.0

Volatility: 8.3

1-Year Total Return ->

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Stock-Card
CDW

A-Score: 4.8/10

Value: 4.5

Growth: 5.9

Quality: 5.1

Yield: 3.0

Momentum: 3.0

Volatility: 7.3

1-Year Total Return ->

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Stock-Card
FIS

A-Score: 4.4/10

Value: 2.8

Growth: 3.6

Quality: 4.4

Yield: 5.0

Momentum: 2.5

Volatility: 8.0

1-Year Total Return ->

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Stock-Card
Fiserv

A-Score: 4.3/10

Value: 7.5

Growth: 8.1

Quality: 6.4

Yield: 0.0

Momentum: 0.0

Volatility: 3.7

1-Year Total Return ->

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Stock-Card
Gartner

A-Score: 4.2/10

Value: 3.5

Growth: 8.1

Quality: 8.0

Yield: 0.0

Momentum: 0.5

Volatility: 5.0

1-Year Total Return ->

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Peers Metrics

12.e Scoring Insights

12.f DCF BETA

Parameters

Short Term Growth

Short term Time

Long-Term Growth

WACC

Target Price

132.09$

Current Price

132.09$

Potential

-0.00%

Expected Cash-Flows