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CDW's Q1 Earnings Miss Estimates, Revenues Decrease Y/Y
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CDW Corporation (CDW - Free Report) reported first-quarter 2024 non-GAAP earnings per share (EPS) of $1.92, which missed the Zacks Consensus Estimate of $2.16. Also, the bottom line declined 5.5% year over year.
The company’s revenues decreased 4.5% year over year to $4.872 billion. Net sales decreased 4.9% at constant currency. The downtick was caused due to weakness across all business segments. However, quarterly revenues beat the consensus mark of $4.396 billion.
Separately, the company announced a quarterly dividend of 62 cents, which will be paid on Jun 11, 2024, to shareholders of record as of May 24.
Net sales of CDW’s Corporate segment amounted to $2.136 billion, declining 3.1% on a year-over-year basis.
The Small Business segment’s net sales of $381 million declined 7.4% year over year.
The Public segment’s net sales amounted to $1.725 billion, down 4.9% from the year-ago quarter. Revenues from Education customers declined 10.4%.
Revenues from Healthcare decreased 1.8%, while revenues from Government decreased 1.5%.
Net sales in Other (Canadian and U.K. operations) declined 6.5% to $631 million.
CDW’s gross profit of $1.063 billion decreased 2.4% on a year-over-year basis. The gross margin expanded 50 basis points (bps) to 21.8% due to the favorable contribution of netted-down revenues, primarily software as a service.
The non-GAAP operating income decreased 7.1% year over year to $403.5 million. Additionally, the non-GAAP operating margin fell 20 bps to 8.3%.
Selling and administrative expenses increased 0.2% year over year to $735.3 million, primarily due to workplace optimization costs.
Balance Sheet and Cash Flow
As of Mar 31, 2024, CDW had $803.8 million of cash and cash equivalents compared with $588.7 million as of Dec 31, 2023.
The company has a long-term debt of $5.02 billion, lower than $5.03 billion as of Dec 31, 2023.
For the first quarter, CDW generated $440 million of cash flow from operating activities compared with $365 million in the year-ago period.
The Zacks Consensus Estimate for Badger Meter’s 2024 EPS has increased 9.9% in the past 60 days to $3.89. BMI’s long-term earnings growth rate is 12.3%.
Badger Meter’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, delivering an average surprise of 12.7%. BMI shares have risen 35.8% in the past year.
The Zacks Consensus Estimate for PINS’s 2024 EPS has increased 0.7% in the past 60 days to $1.34. PINS’s long-term earnings growth rate is 20.1%.
Pinterest’s earnings beat the Zacks Consensus Estimate in three of the last four quarters, delivering an average earnings surprise of 37.4%. Shares of PINS have gained 13% in the past year.
The Zacks Consensus Estimate for ANET’s 2024 EPS has increased 0.4% in the past 60 days to $7.49. ANET’s long-term earnings growth rate is 17.5%.
Arista Networks’ earnings beat the Zacks Consensus Estimate in each of the last four quarters, delivering an average earnings surprise of 13.3%. Shares of ANET have gained 62.7% in the past year.
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CDW's Q1 Earnings Miss Estimates, Revenues Decrease Y/Y
CDW Corporation (CDW - Free Report) reported first-quarter 2024 non-GAAP earnings per share (EPS) of $1.92, which missed the Zacks Consensus Estimate of $2.16. Also, the bottom line declined 5.5% year over year.
The company’s revenues decreased 4.5% year over year to $4.872 billion. Net sales decreased 4.9% at constant currency. The downtick was caused due to weakness across all business segments. However, quarterly revenues beat the consensus mark of $4.396 billion.
Separately, the company announced a quarterly dividend of 62 cents, which will be paid on Jun 11, 2024, to shareholders of record as of May 24.
CDW Corporation Price, Consensus and EPS Surprise
CDW Corporation price-consensus-eps-surprise-chart | CDW Corporation Quote
Quarterly Details
Net sales of CDW’s Corporate segment amounted to $2.136 billion, declining 3.1% on a year-over-year basis.
The Small Business segment’s net sales of $381 million declined 7.4% year over year.
The Public segment’s net sales amounted to $1.725 billion, down 4.9% from the year-ago quarter. Revenues from Education customers declined 10.4%.
Revenues from Healthcare decreased 1.8%, while revenues from Government decreased 1.5%.
Net sales in Other (Canadian and U.K. operations) declined 6.5% to $631 million.
CDW’s gross profit of $1.063 billion decreased 2.4% on a year-over-year basis. The gross margin expanded 50 basis points (bps) to 21.8% due to the favorable contribution of netted-down revenues, primarily software as a service.
The non-GAAP operating income decreased 7.1% year over year to $403.5 million. Additionally, the non-GAAP operating margin fell 20 bps to 8.3%.
Selling and administrative expenses increased 0.2% year over year to $735.3 million, primarily due to workplace optimization costs.
Balance Sheet and Cash Flow
As of Mar 31, 2024, CDW had $803.8 million of cash and cash equivalents compared with $588.7 million as of Dec 31, 2023.
The company has a long-term debt of $5.02 billion, lower than $5.03 billion as of Dec 31, 2023.
For the first quarter, CDW generated $440 million of cash flow from operating activities compared with $365 million in the year-ago period.
Zacks Rank & Stocks to Consider
CDW currently carries a Zacks Rank #4 (Sell).
Some better-ranked stocks from the broader technology space are Badger Meter (BMI - Free Report) , Pinterest (PINS - Free Report) and Arista Networks (ANET - Free Report) . Each stock presently sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Badger Meter’s 2024 EPS has increased 9.9% in the past 60 days to $3.89. BMI’s long-term earnings growth rate is 12.3%.
Badger Meter’s earnings surpassed the Zacks Consensus Estimate in each of the last four quarters, delivering an average surprise of 12.7%. BMI shares have risen 35.8% in the past year.
The Zacks Consensus Estimate for PINS’s 2024 EPS has increased 0.7% in the past 60 days to $1.34. PINS’s long-term earnings growth rate is 20.1%.
Pinterest’s earnings beat the Zacks Consensus Estimate in three of the last four quarters, delivering an average earnings surprise of 37.4%. Shares of PINS have gained 13% in the past year.
The Zacks Consensus Estimate for ANET’s 2024 EPS has increased 0.4% in the past 60 days to $7.49. ANET’s long-term earnings growth rate is 17.5%.
Arista Networks’ earnings beat the Zacks Consensus Estimate in each of the last four quarters, delivering an average earnings surprise of 13.3%. Shares of ANET have gained 62.7% in the past year.