CDW Corporation (CDW) Bundle
A Brief History of CDW Corporation
CDW Corporation, founded in 1984, has evolved into a leading provider of technology solutions for business, government, education, and healthcare. The company went public in 2013 and has since expanded its operations through strategic acquisitions and organic growth.
Company Overview
As of 2024, CDW operates primarily in the United States, but also has a significant presence in the UK and Canada. The company's primary offerings include hardware, software, and integrated IT solutions, catering to a diverse customer base.
Financial Performance
For the nine months ended September 30, 2024, CDW reported:
| Metric | 2024 (in millions) | 2023 (in millions) | Percentage Change |
|---|---|---|---|
| Net Sales | $15,812.7 | $16,357.5 | (3.3%) |
| Gross Profit | $3,447.1 | $3,498.6 | (1.5%) |
| Operating Income | $1,242.7 | $1,245.9 | (0.3%) |
| Net Income | $813.6 | $808.2 | (0.7%) |
| Net Income per Diluted Share | $6.00 | $5.92 | 1.4% |
Segment Performance
Net sales by segment for the three months ended September 30, 2024, were as follows:
| Segment | Net Sales (in millions) | Percentage of Total Net Sales |
|---|---|---|
| Corporate | $2,161.2 | 39.2% |
| Small Business | $379.7 | 6.9% |
| Public Sector | $2,335.7 | 42.3% |
| Other | $640.0 | 11.6% |
Cash Flow and Capital Expenditures
For the nine months ended September 30, 2024, CDW reported cash flows as follows:
| Metric | 2024 (in millions) | 2023 (in millions) |
|---|---|---|
| Net Cash Provided by Operating Activities | $932.0 | $1,062.2 |
| Capital Expenditures | ($94.0) | ($114.7) |
| Free Cash Flow | $838.0 | $947.5 | Adjusted Free Cash Flow | $764.1 | $1,112.9 |
Debt and Liquidity
As of September 30, 2024, CDW had total unsecured indebtedness of $6.0 billion. The company maintained compliance with all covenants under its credit agreements. Additionally, CDW had $1.3 billion available for borrowings under its revolving credit facility, indicating strong liquidity to support operations and growth initiatives.
Recent Developments
In August 2024, CDW issued $1.2 billion in senior notes and completed a cash tender offer for existing notes. This strategic move was aimed at refinancing existing debt and improving the company's capital structure.
CDW continues to focus on enhancing its product offerings and expanding its market reach through both organic growth and strategic acquisitions, positioning itself strongly within the technology solutions landscape.
A Who Owns CDW Corporation (CDW)
Ownership Structure
As of 2024, CDW Corporation (CDW) has a diverse ownership structure that includes institutional investors, mutual funds, and individual shareholders. The largest shareholders include:
| Shareholder Type | Percentage Ownership | Number of Shares Owned (in millions) |
|---|---|---|
| Institutional Investors | 84.5% | 113.5 |
| Mutual Funds | 30.0% | 40.0 |
| Individual Shareholders | 15.5% | 20.0 |
| Insider Ownership | 4.0% | 5.4 |
Top Institutional Shareholders
The following table lists the top institutional shareholders as of 2024:
| Institution | Percentage Ownership | Number of Shares Owned (in millions) |
|---|---|---|
| The Vanguard Group, Inc. | 10.5% | 14.1 |
| BlackRock, Inc. | 9.3% | 12.4 |
| State Street Corporation | 7.9% | 10.5 |
| Fidelity Investments | 6.8% | 9.1 |
| Invesco Ltd. | 4.6% | 6.2 |
Stock Performance
CDW Corporation's stock performance has shown resilience, with a current market capitalization of approximately $18 billion as of 2024. The stock is trading at around $134 per share, reflecting a year-to-date increase of approximately 8%.
Recent Financial Highlights
For the nine months ended September 30, 2024:
- Net sales: $15.8 billion
- Operating income: $1.24 billion
- Net income: $813.6 million
- Gross profit margin: 21.8%
Dividends and Share Buybacks
CDW has maintained a consistent dividend policy, with dividends paid amounting to:
| Year | Dividend per Share | Total Dividends Paid (in millions) |
|---|---|---|
| 2024 | $1.86 | $249.0 |
| 2023 | $1.75 | $238.4 |
Insider Transactions
As of 2024, insider ownership remains strong, with key executives holding significant shares:
| Name | Position | Shares Owned (in millions) |
|---|---|---|
| Christine Leahy | CEO | 1.5 |
| Thomas E. Richards | Executive Chairman | 1.0 |
| Jesse E. Henson | CFO | 0.9 |
Conclusion on Ownership Dynamics
The ownership dynamics of CDW Corporation reflect a blend of institutional strength and insider commitment, positioning the company favorably in the tech distribution market.
CDW Corporation (CDW) Mission Statement
Mission Statement Overview
CDW Corporation focuses on delivering comprehensive IT solutions to a diverse range of customers, including businesses, government agencies, educational institutions, and healthcare organizations. The mission statement emphasizes the commitment to providing top-tier technology products and services, ensuring customer satisfaction through innovative solutions and exceptional service.
Financial Performance Indicators
As of the third quarter of 2024, CDW reported the following financial metrics:
| Metric | Q3 2024 | Q3 2023 | Change (%) |
|---|---|---|---|
| Net Sales | $5,516.6 million | $5,628.3 million | (2.0%) |
| Operating Income | $481.6 million | $478.4 million | 0.7% |
| Net Income | $316.4 million | $315.5 million | 0.3% |
| Net Income per Share (Diluted) | $2.34 | $2.32 | 0.9% |
| Free Cash Flow | $838.0 million | $947.5 million | (11.5%) |
Segment Performance
Net sales by segment for the three months ended September 30, 2024, are as follows:
| Segment | Net Sales ($ million) | Percentage of Total Net Sales |
|---|---|---|
| Corporate | $2,161.2 | 39.2% |
| Small Business | $379.7 | 6.9% |
| Public (Government) | $691.0 | 12.5% |
| Public (Education) | $995.7 | 18.0% |
| Public (Healthcare) | $649.0 | 11.8% |
| Total Public | $2,335.7 | 42.3% |
| Other | $640.0 | 11.6% |
Customer Focus and Strategic Initiatives
CDW emphasizes a customer-centric approach, aiming to enhance the customer experience through tailored IT solutions. The company continues to invest in strategic initiatives that promote innovation, including:
- Expansion of cloud services and hybrid IT solutions.
- Investment in cybersecurity offerings to protect customer data.
- Enhancing customer engagement through digital platforms.
Market Position and Competitive Landscape
As a Fortune 500 company and a member of the S&P 500 Index, CDW competes vigorously in the IT solutions market. The company’s diverse portfolio and strong brand recognition position it favorably against competitors. Key competitive advantages include:
- Robust supplier relationships, providing access to a wide range of products.
- A skilled workforce with expertise in various technology domains.
- Strong financial performance enabling continued investment in growth.
Outlook and Future Goals
CDW's mission statement reflects its commitment to adapting to the evolving technology landscape and meeting customer needs effectively. The company aims for sustainable growth through:
- Continued innovation in product offerings.
- Strengthening partnerships with technology vendors.
- Expanding into new markets and customer segments.
Recent Developments
In 2024, CDW has focused on enhancing its service capabilities and expanding its product lines to meet the changing demands of the market. Recent initiatives include:
- Launching new cloud-based solutions.
- Enhancing customer support services.
- Implementing advanced analytics to improve service delivery.
How CDW Corporation (CDW) Works
Company Overview
CDW Corporation (CDW) is a leading provider of integrated information technology (IT) solutions in North America. The company primarily serves corporate, government, education, and healthcare sectors. As of the third quarter of 2024, CDW operates through multiple segments, including Corporate, Small Business, and Public.
Financial Performance
In the third quarter of 2024, CDW reported net sales of $5,516.6 million, a decrease of $111.7 million or 2.0% compared to the same period in 2023. The nine-month results showed net sales of $15,812.7 million, down 3.3% from $16,357.5 million in 2023.
| Financial Metric | Q3 2024 | Q3 2023 | Change ($) | Change (%) |
|---|---|---|---|---|
| Net Sales | $5,516.6 million | $5,628.3 million | $(111.7) million | (2.0%) |
| Gross Profit | $1,200.7 million | $1,227.7 million | $(27.0) million | (2.2%) |
| Operating Income | $481.6 million | $478.4 million | $3.2 million | 0.7% |
| Net Income | $316.4 million | $315.5 million | $0.9 million | 0.3% |
Segment Performance
The company’s net sales are derived from several segments, each contributing to overall revenue differently. In Q3 2024, the Public segment generated $2,335.7 million, while the Corporate segment accounted for $2,161.2 million.
| Segment | Net Sales (Q3 2024) | Net Sales (Q3 2023) | Change ($) | Change (%) |
|---|---|---|---|---|
| Corporate | $2,161.2 million | $2,226.5 million | $(65.3) million | (2.9%) |
| Small Business | $379.7 million | $378.4 million | $1.3 million | 0.3% |
| Public | $2,335.7 million | $2,422.1 million | $(86.4) million | (3.6%) |
Operating Metrics
CDW's gross profit margin for Q3 2024 remained stable at 21.8%, consistent with Q3 2023. The operating income margin also showed improvement, reaching 8.7% compared to 8.5% in the previous year.
| Operating Metric | Q3 2024 | Q3 2023 |
|---|---|---|
| Gross Profit Margin | 21.8% | 21.8% |
| Operating Income Margin | 8.7% | 8.5% |
Cash Flow and Liquidity
For the nine months ended September 30, 2024, CDW reported net cash provided by operating activities of $932.0 million, down from $1,062.2 million in 2023. The free cash flow for the same period was $838.0 million, compared to $947.5 million in the previous year.
| Cash Flow Metric | 2024 | 2023 |
|---|---|---|
| Net Cash from Operating Activities | $932.0 million | $1,062.2 million |
| Capital Expenditures | $(94.0) million | $(114.7) million |
| Free Cash Flow | $838.0 million | $947.5 million |
Debt and Financing
As of September 30, 2024, CDW's total unsecured indebtedness was reported at $6.0 billion. The company issued $600 million of senior notes in the third quarter, which will mature in 2030 and 2034.
| Debt Type | Amount ($ million) | Maturity Date | Interest Rate (%) |
|---|---|---|---|
| Senior Unsecured Term Loan | $634.5 million | December 2026 | Variable |
| Senior Notes due 2024 | $183.5 million | December 2024 | 5.500% |
| Senior Notes due 2025 | $211.1 million | May 2025 | 4.125% |
| Senior Notes due 2026 | $1,000.0 million | December 2026 | 2.670% |
Tax and Effective Rate
CDW's effective tax rate for Q3 2024 was recorded at 26.0%, up from 24.8% in Q3 2023. The increase was primarily due to lower excess tax benefits on equity-based compensation.
| Period | Effective Tax Rate |
|---|---|
| Q3 2024 | 26.0% |
| Q3 2023 | 24.8% |
How CDW Corporation (CDW) Makes Money
Business Model Overview
CDW Corporation operates as a leading provider of technology solutions and services in North America and the UK. The company generates revenue through various segments, including Corporate, Small Business, and Public sectors, which encompass government, education, and healthcare. CDW's offerings include hardware, software, and services, tailored to meet the needs of its diverse customer base.
Revenue Breakdown
For the three months ended September 30, 2024, CDW reported total net sales of $5,516.6 million, a decrease of 2.0% from the previous year. The following table summarizes the net sales by segment:
| Segment | Net Sales (in millions) | Percentage of Total Net Sales | Year-over-Year Change (in millions) | Year-over-Year Change (%) |
|---|---|---|---|---|
| Corporate | $2,161.2 | 39.2% | $(65.3) | (2.9%) |
| Small Business | $379.7 | 6.9% | $1.3 | 0.3% |
| Public | $2,335.7 | 42.3% | $(86.4) | (3.6%) |
| Other | $640.0 | 11.6% | $(86.4) | — |
Product and Service Offerings
CDW categorizes its revenue into hardware, software, and services. For the three months ended September 30, 2024, the breakdown was as follows:
| Category | Net Sales (in millions) | Percentage of Total Net Sales |
|---|---|---|
| Hardware | $3,958.6 | 71.8% |
| Software | $1,048.3 | 19.0% |
| Services | $481.9 | 8.7% |
| Other | $27.8 | 0.5% |
Financial Performance
For the nine months ended September 30, 2024, CDW reported total net sales of $15,812.7 million, reflecting a 3.3% decrease compared to the same period in 2023. The following table provides details on key financial metrics:
| Metric | 2024 | 2023 | Change (%) |
|---|---|---|---|
| Net Sales | $15,812.7 million | $16,357.5 million | (3.3%) |
| Gross Profit | $3,447.1 million | $3,498.6 million | (1.5%) |
| Operating Income | $1,242.7 million | $1,245.9 million | (0.3%) |
| Net Income | $813.6 million | $808.2 million | 0.7% |
Cost Structure
CDW's cost structure impacts its profitability. For the three months ended September 30, 2024, the company reported:
| Expense Type | Amount (in millions) | Percentage Change |
|---|---|---|
| Cost of Sales | $4,315.9 | (1.9%) |
| Selling and Administrative Expenses | $719.1 | (4.0%) |
| Interest Expense, Net | $(54.4) | (5.2%) |
Market Trends and Challenges
CDW faces challenges due to economic uncertainties and a cautious approach to technology spending among customers. The demand for netcom and collaboration products has decreased, impacting overall sales. Despite this, there has been a notable increase in sales of notebooks and mobile devices.
Cash Flow and Liquidity
CDW's cash flow from operating activities for the nine months ended September 30, 2024, was $932.0 million, a decrease from $1,062.2 million in 2023. The adjusted free cash flow was $764.1 million, down from $1,112.9 million in the prior year.
| Cash Flow Metric | 2024 (in millions) | 2023 (in millions) | Change (in millions) |
|---|---|---|---|
| Net Cash Provided by Operating Activities | $932.0 | $1,062.2 | $(130.2) |
| Capital Expenditures | $(94.0) | $(114.7) | $20.7 |
| Free Cash Flow | $838.0 | $947.5 | $(109.5) |
| Adjusted Free Cash Flow | $764.1 | $1,112.9 | $(348.8) |
Debt and Financing
As of September 30, 2024, CDW had total unsecured indebtedness of $6.0 billion, reflecting various financing arrangements to support operations and growth initiatives.
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Article updated on 8 Nov 2024
Resources:
- CDW Corporation (CDW) Financial Statements – Access the full quarterly financial statements for Q3 2024 to get an in-depth view of CDW Corporation (CDW)' financial performance, including balance sheets, income statements, and cash flow statements.
- SEC Filings – View CDW Corporation (CDW)' latest filings with the U.S. Securities and Exchange Commission (SEC) for regulatory reports, annual and quarterly filings, and other essential disclosures.