CDW (NASDAQ:CDW) Issues Quarterly Earnings Results, Meets Expectations

CDW (NASDAQ:CDW) released its quarterly earnings results on Wednesday. The information technology services provider reported $2.28 earnings per share for the quarter, hitting the consensus estimate of $2.28, FiscalAI reports. The business had revenue of $5.68 billion for the quarter, compared to the consensus estimate of $5.48 billion. CDW had a net margin of 4.70% and a return on equity of 49.67%. The company’s quarterly revenue was up 9.2% on a year-over-year basis. During the same period last year, the firm earned $2.15 earnings per share.

Here are the key takeaways from CDW’s conference call:

• Q1 financials — Consolidated net sales rose 9%, gross profit grew 6%, non‑GAAP EPS increased 6%, and adjusted free cash flow was $251M, delivering a record first‑quarter gross profit.
• Demand shifted toward AI and infrastructure with hardware up 10% and networking/servers/storage each >20%, while services and netted‑down revenues were deprioritized, which pressured gross margin by roughly 60 basis points due to mix.
• The new Geared for Growth AI‑powered modernization program is being embedded across operations and sales (e.g., CDW Assist Super Agent), with expected benefits starting in H2 and a targeted $100M–$200M annual run‑rate improvement by 2027–2028.
• Supply and timing dynamics created an elevated backlog entering Q2 from pull‑ins and shipment delays, supporting a stronger near‑term outlook while management remains cautious about potential H2 uncertainty.
• Capital allocation remained shareholder‑friendly — $282M returned in Q1 ($201M buybacks, $81M dividends), net leverage at ~2.5x, a target ~25% dividend payout ratio, and opportunistic M&A/share repurchases going forward.

CDW Trading Down 3.1%

CDW stock traded down $3.41 during trading hours on Friday, hitting $106.79. The company had a trading volume of 561,942 shares, compared to its average volume of 1,733,327. The firm has a market cap of $13.67 billion, a P/E ratio of 13.02, a P/E/G ratio of 1.50 and a beta of 1.04. The company has a 50-day moving average price of $125.02 and a two-hundred day moving average price of $134.26. CDW has a 1 year low of $106.00 and a 1 year high of $192.30. The company has a debt-to-equity ratio of 1.81, a quick ratio of 1.10 and a current ratio of 1.16.

CDW Announces Dividend

The business also recently disclosed a quarterly dividend, which will be paid on Wednesday, June 10th. Investors of record on Monday, May 25th will be issued a dividend of $0.63 per share. The ex-dividend date is Friday, May 22nd. This represents a $2.52 dividend on an annualized basis and a yield of 2.4%. CDW’s dividend payout ratio (DPR) is presently 31.15%.

Analysts Set New Price Targets

A number of research analysts recently commented on the company. Citigroup boosted their price target on CDW from $148.00 to $150.00 and gave the stock a “neutral” rating in a report on Thursday, February 5th. UBS Group cut their price objective on CDW from $162.00 to $147.00 and set a “buy” rating for the company in a research report on Thursday. Evercore reissued an “outperform” rating and set a $180.00 price target on shares of CDW in a research note on Tuesday, January 20th. Raymond James Financial set a $150.00 price objective on CDW in a research note on Wednesday. Finally, Morgan Stanley boosted their price target on shares of CDW from $141.00 to $142.00 and gave the stock an “equal weight” rating in a research report on Thursday, February 5th. One research analyst has rated the stock with a Strong Buy rating, two have issued a Buy rating and five have given a Hold rating to the company’s stock. According to MarketBeat.com, CDW has an average rating of “Moderate Buy” and a consensus target price of $146.00.

Key Stories Impacting CDW

Here are the key news stories impacting CDW this week:

• Positive Sentiment: Revenue beat and demand for AI/infrastructure: CDW reported solid Q1 sales growth driven by infrastructure and AI hardware demand, which supports the company’s top-line momentum. CDW Corporation Q1 2026 Earnings Call Summary
• Positive Sentiment: ‘Geared for Growth’ AI-first initiative: Management outlined an AI-driven efficiency program targeting $100M–$200M of run‑rate improvements into 2027–2028, which could meaningfully lift margins over time. CDW CEO Christine Leahy: ‘Geared For Growth’ AI-First Initiative
• Positive Sentiment: Dividend maintained: CDW declared a quarterly dividend, supporting income-oriented holders and signaling board confidence in cash flow. (Company release May 6)
• Neutral Sentiment: EPS roughly inline: Reported EPS was essentially in line with consensus, so the print didn’t surprise on the bottom line even as revenue beat. CDW Corporation Q1 2026 Earnings Call Summary
• Neutral Sentiment: Analyst views remain mixed: New and differing price targets were published (JPMorgan cut to $130 while others range higher), leaving a wide band of expectations that creates volatility. New Analyst Forecast: $CDW Given $130 Price Target
• Neutral Sentiment: Technicals — oversold setup: Some screens now show CDW as oversold, which could attract short-term buyers even amid broader weakness. CDW Loses 14.0% in 4 Weeks — RSI Note
• Negative Sentiment: Sharp sell-off after Q1: Despite the revenue beat, investors punished the stock due to margin compression and mixed operational signals — the shares dropped significantly and hit 52‑week lows. CDW shares plunge 20 per cent despite upbeat Q1 results
• Negative Sentiment: Analyst downgrade/price-target cuts: JPMorgan moved to a neutral stance and lowered its target, and other firms have trimmed expectations — this reduced buy-side conviction and amplified selling pressure. New Analyst Forecast: $CDW Given $130 Price Target
• Negative Sentiment: Insider/congressional selling & institutional churn: Recent insider sales and notable institutional rebalancing added to the negative sentiment backdrop. QuiverQuant CDW data (insider/institutional activity)

Hedge Funds Weigh In On CDW

Several institutional investors have recently made changes to their positions in CDW. Brown Brothers Harriman & Co. raised its position in shares of CDW by 38.6% in the 4th quarter. Brown Brothers Harriman & Co. now owns 912 shares of the information technology services provider’s stock worth $124,000 after acquiring an additional 254 shares in the last quarter. Los Angeles Capital Management LLC acquired a new position in shares of CDW during the fourth quarter valued at about $144,000. Dark Forest Capital Management LP purchased a new position in shares of CDW in the third quarter worth $313,000. Campbell & CO Investment Adviser LLC purchased a new position in CDW in the 4th quarter worth $351,000. Finally, Syon Capital LLC lifted its holdings in shares of CDW by 36.2% during the fourth quarter. Syon Capital LLC now owns 3,650 shares of the information technology services provider’s stock worth $497,000 after purchasing an additional 970 shares during the period. Hedge funds and other institutional investors own 93.15% of the company’s stock.

About CDW

CDW (NASDAQ: CDW) is a leading provider of information technology products and integrated solutions for business, government, education and healthcare customers. The company sources and resells hardware and software from major technology vendors and packages those products with professional services, managed services and lifecycle support. Its offerings span IT infrastructure, cloud and data center solutions, cybersecurity, networking, unified communications, endpoint devices, and software licensing and procurement services designed to simplify IT operations for customers.

CDW combines a broad product portfolio with consultative sales, implementation and technical support capabilities.