CDW Corporation (CDW, Financial) is forming a strategic alliance with Asato Corporation to introduce AI-driven IT asset intelligence to a wide range of customers, including enterprises, mid-market, and small to medium-sized businesses (SMBs). This collaboration will see CDW incorporating the Asato platform into its offerings as a primary market partner. The partnership aims to assist Chief Information Officers (CIOs) in integrating disparate IT data from various sources such as enterprise IT systems, cloud services, and SaaS platforms. This integration is designed to enhance the efficiency of technology investments and achieve significant performance improvements.
Wall Street Analysts Forecast
Based on the one-year price targets offered by 10 analysts, the average target price for CDW Corp (CDW, Financial) is $211.21 with a high estimate of $235.00 and a low estimate of $180.00. The average target implies an upside of 16.85% from the current price of $180.75. More detailed estimate data can be found on the CDW Corp (CDW) Forecast page.
Based on the consensus recommendation from 13 brokerage firms, CDW Corp's (CDW, Financial) average brokerage recommendation is currently 2.2, indicating "Outperform" status. The rating scale ranges from 1 to 5, where 1 signifies Strong Buy, and 5 denotes Sell.
Based on GuruFocus estimates, the estimated GF Value for CDW Corp (CDW, Financial) in one year is $193.00, suggesting a upside of 6.78% from the current price of $180.75. GF Value is GuruFocus' estimate of the fair value that the stock should be traded at. It is calculated based on the historical multiples the stock has traded at previously, as well as past business growth and the future estimates of the business' performance. More detailed data can be found on the CDW Corp (CDW) Summary page.
CDW Key Business Developments
Release Date: May 07, 2025
- Net Sales: $5.2 billion, up 8% year-over-year on an average daily sales basis.
- Gross Profit: $1.1 billion, up 7% year-over-year on an average daily basis.
- Non-GAAP Operating Income: $444 million, up 10% year-over-year.
- Non-GAAP Net Income Per Share: $2.15, up 12% year-over-year.
- Gross Margin: 21.6%, down 20 basis points year-over-year.
- Non-GAAP SG&A: $678 million, up 2.8% year-over-year.
- Non-GAAP Operating Income Margin: 8.5%, up from 8.3% in the prior year.
- Non-GAAP Net Income: $287 million, up 9.9% year-over-year.
- Adjusted Free Cash Flow: $249 million, representing 87% of non-GAAP net income.
- Net Debt: Approximately $5.2 billion.
- Liquidity: Cash plus revolver availability of approximately $1.7 billion.
- Cash Conversion Cycle: 15 days, down one day from the prior year.
- Share Repurchases and Dividends: $200 million in share repurchases and $83 million in dividends.
For the complete transcript of the earnings call, please refer to the full earnings call transcript.
Positive Points
- CDW Corp (CDW, Financial) reported a strong start to 2025 with net sales of $5.2 billion, an 8% increase from the previous year.
- Gross profit increased by 7% to $1.1 billion, and non-GAAP operating income rose by 10% to $444 million.
- The company experienced robust growth in the healthcare sector, with net sales up 20%, driven by client devices, cloud, and services.
- CDW Corp (CDW) maintained a balanced performance across hardware, software, and services, each increasing by high-single-digits or better.
- The company successfully managed expenses, achieving a non-GAAP SG&A efficiency ratio of 60.4%, down 170 basis points from the previous year.
Negative Points
- Tariff uncertainty has slowed down major infrastructure investments, impacting the growth of certain product categories like NetComm and storage.
- Federal government market growth was subdued due to new policy priorities, affecting IT planning and budgets.
- The company anticipates a more muted environment in the education and federal sectors due to pull-forward demand and government efficiency initiatives.
- CDW Corp (CDW) expects potential economic uncertainty and caution to impact growth, with no assumptions of recessionary conditions factored into their outlook.
- Gross margins were slightly compressed due to a mix shift towards client devices, which comprised a higher percentage of net sales compared to the previous year.
