CDW Corporation (CDW)
NASDAQInformation TechnologyInformation Technology ServicesSnapshot 2026-09-04
$152.38-1.00%
Close 2026-09-04 · 1-day change
NASDAQInformation TechnologyInformation Technology ServicesSnapshot 2026-09-04
Broken: Primary pillar broken — Maintain strong cash flow generation: Q1 FY26 OCF $274.8M vs $275M target.
CDW grows revenue about 9% yearly, beating the US IT market by 2-3 points. Profit margins stay stable with a PE of 13.7, well below peers at 50.9. The company returns cash to shareholders with a $1 billion buyback increase. Cash flow remains solid near $275 million quarterly.
CDW lags its growth target and struggles to improve cash flow. Revenue growth may slow to the 4% analysts expect. Profit margins could compress, and volatile management may hinder execution.
The stock trades about 25% below our fair value near $185, reflecting modest 4% revenue growth expected by analysts. Our fair value is 26% above the Street median, showing upside if CDW outperforms.
Breaks if: No further buyback authorization or reduction in repurchase program
CDW has increased its share repurchase program by $1 billion to enhance shareholder value.
This is not a price target or investment advice.
A long-form read on the 1–3 year hold thesis. It updates when the weekly evidence changes.
This investment represents a durable compounder with a focus on consistent growth. The current thesis state is intact, supported by recent financial performance and management's commitment to exceed market growth.
The market seems to price CDW as cheap compared to its peers, reflecting a low expectations gap. This suggests that while there is some fragility due to weak execution quality, the overall valuation is justified given the company's recent performance.
Fundamentals are likely to remain stable, with management on track to meet its growth targets and maintain strong cash flow generation. However, there is elevated risk due to the potential for guidance cuts, which could impact future performance.
The thesis hinges on several key factors, including the Fed's interest rate decisions and the performance of sector leaders like IBM and ACN. Additionally, management's ability to execute on its priorities will be crucial for maintaining momentum.
The most important moves since the prior daily snapshot.
Mixed, the news cuts both ways. CDW raised its 2026 outlook, driven by AI infrastructure demand. However, the company faced challenges with a margin miss, indicating potential growth hurdles. The mixed signals create uncertainty about future performance.
as of 2026-09-04
Review the evidence to watch, what would become a concern, and what would make it less concerning.
Not investment advice. Scores describe historical and current data; they are not forecasts of future returns. Consult a licensed advisor before making investment decisions.
Breaks if: quarterly cash from operations falls below $275M
Breaks if: YoY revenue growth falls below 7% next year
Overall, CDW appears to be in a solid position for the next 1 to 3 years, but investors should monitor external factors and management execution closely. Not investment advice.