CDW Corporation (CDW) Bundle
Understanding CDW Corporation (CDW) Revenue Streams
Revenue Analysis
CDW Corporation's revenue for the fiscal year 2023 reached $26.0 billion, representing a 10.4% increase from the previous year.
| Revenue Source | 2023 Contribution | Year-over-Year Growth |
|---|---|---|
| Corporate | $15.2 billion | 12.3% |
| Small Business | $6.8 billion | 8.7% |
| Public Sector | $4.0 billion | 9.5% |
Key revenue segments include:
- Hardware sales: $12.5 billion
- Software sales: $6.3 billion
- Services and recurring revenue: $7.2 billion
Geographic revenue breakdown:
- United States: $24.8 billion (95.4% of total revenue)
- International markets: $1.2 billion (4.6% of total revenue)
Technology category revenue distribution:
| Technology Category | 2023 Revenue |
|---|---|
| Networking | $5.6 billion |
| Security | $4.3 billion |
| Cloud Solutions | $3.9 billion |
A Deep Dive into CDW Corporation (CDW) Profitability
Profitability Metrics Analysis
Financial performance metrics reveal critical insights into the company's profitability and operational efficiency.
| Profitability Metric | 2023 Value | 2022 Value |
|---|---|---|
| Gross Profit Margin | 22.1% | 21.7% |
| Operating Profit Margin | 9.6% | 9.3% |
| Net Profit Margin | 7.2% | 6.9% |
Key profitability highlights include:
- Total revenue: $24.1 billion in 2023
- Net income: $1.74 billion
- Earnings per share: $12.48
| Efficiency Metric | 2023 Performance |
|---|---|
| Return on Equity (ROE) | 48.3% |
| Return on Assets (ROA) | 16.7% |
Operational efficiency indicators demonstrate consistent financial performance with incremental improvements across key profitability metrics.
Debt vs. Equity: How CDW Corporation (CDW) Finances Its Growth
Debt vs. Equity Structure Analysis
As of Q4 2023, CDW Corporation's financial structure reveals critical insights into its capital management strategy.
Debt Overview
Total long-term debt: $4.58 billion Total short-term debt: $392 million
| Debt Metric | Amount |
|---|---|
| Total Debt | $4.972 billion |
| Debt-to-Equity Ratio | 2.1:1 |
| Interest Expense | $187.3 million |
Credit Ratings
- Moody's Rating: Baa2
- S&P Global Rating: BBB
- Fitch Rating: BBB
Debt Financing Characteristics
Weighted average interest rate: 5.6% Maturity profile range: 2025-2031
| Debt Type | Amount | Percentage |
|---|---|---|
| Fixed Rate Debt | $3.2 billion | 64.4% |
| Variable Rate Debt | $1.772 billion | 35.6% |
Equity Composition
Total shareholders' equity: $2.36 billion Common stock outstanding: 129.4 million shares
Assessing CDW Corporation (CDW) Liquidity
Liquidity and Solvency Analysis
The liquidity assessment of the company reveals critical financial metrics for investor consideration.
Liquidity Ratios
| Liquidity Metric | 2023 Value | 2022 Value |
|---|---|---|
| Current Ratio | 1.58 | 1.45 |
| Quick Ratio | 1.22 | 1.17 |
| Working Capital | $2.1 billion | $1.9 billion |
Cash Flow Overview
| Cash Flow Category | 2023 Amount |
|---|---|
| Operating Cash Flow | $1.87 billion |
| Investing Cash Flow | -$412 million |
| Financing Cash Flow | -$896 million |
Key Liquidity Strengths
- Cash and Cash Equivalents: $814 million
- Short-Term Investments: $456 million
- Available Credit Lines: $1.5 billion
Debt Structure
| Debt Metric | Amount |
|---|---|
| Total Debt | $3.2 billion |
| Debt-to-Equity Ratio | 1.45 |
| Interest Coverage Ratio | 8.7 |
Is CDW Corporation (CDW) Overvalued or Undervalued?
Valuation Analysis: Is the Company Overvalued or Undervalued?
The valuation analysis reveals key financial metrics that provide insights into the company's current market positioning and investor sentiment.
Key Valuation Ratios
| Valuation Metric | Current Value | Industry Benchmark |
|---|---|---|
| Price-to-Earnings (P/E) Ratio | 18.5x | 19.2x |
| Price-to-Book (P/B) Ratio | 4.7x | 5.1x |
| Enterprise Value/EBITDA | 12.3x | 13.6x |
Stock Price Performance
| Time Period | Price Movement |
|---|---|
| Last 12 Months | +22.7% |
| Year-to-Date | +15.4% |
Dividend Characteristics
- Current Dividend Yield: 1.8%
- Dividend Payout Ratio: 32%
- Dividend Growth Rate (5-Year): 8.5%
Analyst Recommendations
| Recommendation | Percentage |
|---|---|
| Buy | 62% |
| Hold | 33% |
| Sell | 5% |
Valuation Insights
The current valuation metrics suggest the company is trading close to its intrinsic value, with slight undervaluation compared to industry benchmarks.
Key Risks Facing CDW Corporation (CDW)
Risk Factors: Comprehensive Analysis
The company faces multiple critical risk dimensions across operational, financial, and market-related domains.
Market and Competitive Risks
| Risk Category | Potential Impact | Probability |
|---|---|---|
| Technology Market Volatility | High Competition | 65% |
| Supply Chain Disruptions | Potential Revenue Loss | 42% |
| Cybersecurity Threats | Operational Vulnerability | 38% |
Financial Risk Indicators
- Debt-to-Equity Ratio: 1.2:1
- Interest Coverage Ratio: 4.7x
- Working Capital Ratio: 1.6x
Regulatory Compliance Risks
Key regulatory challenges include:
- Data Privacy Regulations
- International Trade Restrictions
- Technology Export Controls
Strategic Risk Mitigation
| Risk Area | Mitigation Strategy | Investment |
|---|---|---|
| Cybersecurity | Advanced Threat Detection | $12.5 million |
| Supply Chain | Diversified Vendor Network | $8.3 million |
| Technology Innovation | R&D Investment | $45.6 million |
Future Growth Prospects for CDW Corporation (CDW)
Growth Opportunities
CDW Corporation's growth strategy focuses on several key areas with specific financial and market indicators:
- Revenue Growth: $21.1 billion in 2022, representing 13.6% year-over-year increase
- Technology Solutions Segment Expansion: $19.6 billion segment revenue in 2022
- Customer Base Growth: 250,000+ business, government, and education customers
| Growth Segment | 2022 Performance | Projected Growth |
|---|---|---|
| Cloud Solutions | $6.3 billion | 15-18% annual growth |
| Cybersecurity Services | $1.8 billion | 20% market expansion |
| Hybrid IT Infrastructure | $5.2 billion | 12-15% annual growth |
Strategic growth initiatives include:
- Continuous investment in digital transformation services
- Expanding multi-vendor technology solutions portfolio
- Strengthening partnerships with major technology providers
Key competitive advantages driving growth:
- Comprehensive technology ecosystem
- Advanced technical expertise
- Nationwide service capabilities
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