Stock analysis · Bull Rankings model

CDW analysis

CDW CorporationInformation Technology Services. Scored on the same transparent model behind the daily rankings.

CDW
CDW Corporation · Information Technology Services
FCF$860mC+
Rev+7.4%B
D/E2.63D
P/E16.1xA-
PEG1.33B
71.1Score
$134.03$16.8B
1Y Target$155.89Analyst consensus · 9 analysts
5Y Target$228.24Compound horizon
10Y Target$338.57Long-dated conviction
FCF$860mTTM
C+
FCF $860m — respectable but not differentiating
Rev+7.4%TTM YoY
B
Revenue +7.4% — at or above S&P median
D/E2.63
D
D/E 2.63 — most levered decile in Technology (≈95th pctile)
P/E16.1x
A-
P/E 16.1 — cheaper than most Technology peers (≈25th pctile)
PEG1.33
B
PEG 1.33 — acceptable premium for growth

Forward price target — the 1-year figure is the analyst consensus where the stock is covered; the 5- and 10-year figures compound our earnings estimate from there. The DCF below is a separate cross-check on intrinsic value (what it's worth today), not another target.

Quality-growth score · 71.1
Quality73.3
Growth68.9
Value71.1
Why this score
  • Buying back stock
  • Durable high returns
Entry · Margin of safety
52-week rangeMid-range
22% off the 12-month high
vs DCF fair value10% aboveest. fair value ~$122
What the price assumes: free cash flow compounding at ~9% a year for the next decade — vs the ~9% a year our model projects from current growth and analyst estimates.
Quality signals · context only
Gross profitability29% · Bgross profit ÷ total assets (Novy-Marx)
ROIC16.1% · A-return on invested capital — not score-weighted

Model-generatedGenerated by the Bull Rankings model from this company's reported fundamentals, and checked against the figures shown above.

Why now
The Bull Rankings model gives CDW a Quality‑Growth score of 69.9 anchored by a strongest pillar of Quality (73) and a weakest pillar of Value (68); the thesis is that CDW’s integrated IT solutions for the Government segment will keep compounding revenue at 7.4% YoY while its ultra‑high 44.2% ROE fuels free‑cash‑flow generation of $860 million TTM, comfortably covering its modest debt load. This combination of premium returns and steady cash flow means the stock can sustain the 10% FCF growth baked into today’s price, making the upside hinge on continued hybrid‑cloud adoption across its core customers.
Moat
CDW’s moat lies in its end‑to‑end IT procurement platform for large‑scale Government contracts, where switching costs are steep because agencies rely on CDW’s bundled hardware, software, and managed‑service bundles across hybrid infrastructure and security. The 44.2% ROE reflects pricing power derived from being a preferred reseller for mission‑critical solutions, a position competitors can’t quickly replicate without deep channel relationships and compliance certifications.
Risk
The bear case centers on the model’s weak Value pillar and the fact that the implied 10% free‑cash‑flow growth outpaces the actual revenue growth of 7.4%, suggesting the market may be over‑optimistic; a slip in government spending or a rise in the debt‑to‑equity ratio beyond the current 2.63 could pressure the 17.1× P/E and force a re‑rating. A sustained slowdown in contract wins would trigger the value‑risk signal and crush the upside.
Horizon
1-3 yr $155.89 (9-analyst consensus) — fundamentals + valuation re-rating. 5 yr $228.24 at ~11% CAGR — compounding case rests on the competitive position widening. 10 yr $338.57 if current growth sustains into durable earnings power.
Not investment advice. The Bull Rankings publishes a quantitative ranking model and accompanying analysis for general informational purposes only. Nothing on this page is a recommendation to buy, sell, or hold any security; nothing is personalized to your circumstances, risk tolerance, or tax situation. Investing carries the risk of loss — invest at your own risk and consider consulting a licensed financial professional before acting on anything you read here. See terms and methodology for full disclosures.

CDW vs the Top Picks average

PillarCDWBook avgDiff
Quality0.730.84-0.10
Growth0.690.87-0.18
Value0.710.76-0.05

Averaged across the 30 names in today's Top Picks (mean score 81.5). A name can beat these averages and still be absent from the book — it also applies concentration limits.

Trend
+1.2 over 46 daily scores
From 69.9 (Jun 22) → 71.1 (now)

One point per daily model run. The range autoscales, so a flat-looking line can still hide 1–2 point moves — read the From → To values for the actual range.

Analyst estimate revisions

30-day change+1.3%
90-day change+2.7%
Forward EPS estimate$11.94

Over the last 90 days, what analysts expect CDW to earn is drifting higher (+2.7%). The estimate is derived from price and forward P/E captured at the same instant, so a moving share price does not move this number — only a changed forecast does.

A rising estimate means expectations are improving, not that the price has failed to keep up — and estimates get cut as readily as they get raised. It is not part of the Bull Rankings score. Biggest movers across the market →

Shares to buy
14
Position size
$1,876
3.8% of portfolio
Stop price
$100.52
25% below $134.03
$ at risk if stopped
$469.11
budget $500.00 · 1% of portfolio

Math only — share count is floor(portfolio × risk% ÷ (price × stop%)). Doesn't account for commissions, slippage, gap risk, or position-correlation across your book. Inputs persist locally; never sent to the server. Not investment advice.

Latest CDW developments

Recent headlines from across the financial press · updated daily. Links open the source.

CDW Corporation (CDW): score, valuation & FAQ

CDW Corporation (CDW) is a Information Technology Services company that scores 71.1 out of 100 on the Bull Rankings quality-growth model — a solid, above-average reading. The score blends three pillars — quality (durable returns, healthy margins, low leverage), growth (revenue and earnings), and value (valuation versus sector peers) — into one number, refreshed daily; it is a screen, not a buy recommendation.

Its strongest graded signals are P/E (A-), while D/E (D) rate weaker. On valuation, CDW sits about 10% above our discounted-cash-flow fair value — the current price implies roughly 9% annual free-cash-flow growth over the next decade.

Is CDW a good stock to buy?

Bull Rankings scores CDW 71.1 out of 100 on its quality-growth model, which is a solid, above-average reading. That is driven by P/E (A-). A score is a quantitative screen of CDW Corporation's fundamentals, not personalised financial advice — weigh it against your own time horizon and risk tolerance, and read the risk factors below before acting.

Why does CDW score 71.1 on Bull Rankings?

It grades evenly across the three pillars — quality 73.3, growth 68.9, value 71.1 out of 100 — so no single pillar is carrying the score. CDW earns its highest marks on P/E (A-), and is held back by D/E (D). Each signal is graded against sector-aware thresholds rather than one absolute bar, so CDW is measured against Information Technology Services peers, not against the market as a whole.

Is CDW overvalued or undervalued?

Based on $134.03, CDW sits about 10% above our discounted-cash-flow fair value — the current price implies roughly 9% annual free-cash-flow growth over the next decade. It trades at a 16.1x P/E (graded A-). Discounted-cash-flow estimates are sensitive to growth and discount-rate assumptions, so treat this as a cross-check, not a price target.

What are the main risks of investing in CDW?

The bear case centers on the model’s weak Value pillar and the fact that the implied 10% free‑cash‑flow growth outpaces the actual revenue growth of 7.4%, suggesting the market may be over‑optimistic; a slip in government spending or a rise in the debt‑to‑equity ratio beyond the current 2.63 could pressure the 17.1× P/E and force a re‑rating. A sustained slowdown in contract wins would trigger the value‑risk signal and crush the upside.

New to these metrics? The guides explain free cash flow, how the score works, and more in the learn hub — or run another name through the screener.

Bull Rankings is an automated fundamentals screen for research and education. It is not investment advice, and nothing here is a recommendation to buy or sell any security. Do your own research and consider consulting a licensed financial advisor.

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