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Here's Why CDW Stock's Rally is Likely to Continue Further

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CDW Corporation (CDW - Free Report) is currently one of the top-performing stocks in the technology sector. The stock’s price rally reflects the company’s robust fundamentals. Therefore, if you haven’t taken advantage of the share-price appreciation yet, it’s time you add the stock to your portfolio now.

The company has performed brilliantly over the past year and has the potential to carry on the momentum further.

Why an Attractive Pick?

Share-Price Appreciation: CDW’s price trend reflects that the stock has had an impressive run on the bourse over the past year. Shares of the company have surged 68.9% compared with the S&P 500’s rally of 52.4%.

Solid Rank & Growth Score: CDW currently carries a Zacks Rank #2 (Buy) and has a Growth Score of A. Our research shows that stocks with a Growth Score of A or B, when combined with a Zacks Rank #1 (Strong Buy) or #2, offer the best investment opportunities for investors. Thus, the company appears to be a compelling investment proposition at the moment. You can see the complete list of today’s Zacks #1 Rank stocks here.

Northward Estimate Revisions: Out of the seven analysts covering the stock, six have raised the estimates for 2021 over the past 60 days, reflecting their confidence in the company. During the same period, the Zacks Consensus Estimate for the current year has moved approximately 6% north.

Positive Earnings Surprise History: CDW has an impressive earnings surprise history. The company outpaced estimates in all of the trailing four quarters, delivering an average earnings surprise of 14.1%.

Solid Growth Prospects: The Zacks Consensus Estimate of $7.10 for 2021 earnings suggests growth of 7.7% from the year-ago reported figure. Moreover, 2022 earnings are likely to register 10.7% growth and reach $7.86 per share. The long-term earnings per share growth rate is estimated to be 13.1%.

Growth Drivers: CDW is benefiting from the ongoing digital transformation and increased demand for products that enable remote working and operations’ continuity plan amid the coronavirus crisis. It is also gaining from growth across government, education and healthcare end markets.

The acquisitions of Scalar Decisions and Aptris have strengthened its capabilities and expanded the product offerings. Progress in network management, storage management and operating system software is a tailwind. CDW’s core strength of providing best-in-class services and easy-to-acquire technologies will bolster the firm’s growth in the future.

Furthermore, the latest forecast for worldwide IT spending by Gartner is a positive for CDW. The worldwide IT spending is anticipated to be $3.75 trillion in 2021, suggesting an increase of 4% from 2020. The research firm expects worldwide spending on IT services to be up 4.1% year on year to $1.03 trillion this year.

Considering CDW’s growth prospects, it makes sense to invest for long-term gains.

Other Stocks to Consider

Some other top-ranked stocks in the broader technology sector are Dropbox (DBX - Free Report) , Adobe (ADBE - Free Report) and NVIDIA (NVDA - Free Report) , each carrying a Zacks Rank of 2, at present.

The long-term earnings per share growth rate for Dropbox, Adobe and NVIDIA is pegged at 40.9%, 19% and 12.6%, respectively.

These Stocks Are Poised to Soar Past the Pandemic

The COVID-19 outbreak has shifted consumer behavior dramatically, and a handful of high-tech companies have stepped up to keep America running. Right now, investors in these companies have a shot at serious profits. For example, Zoom jumped 108.5% in less than 4 months while most other stocks were sinking.

Our research shows that 5 cutting-edge stocks could skyrocket from the exponential increase in demand for “stay at home” technologies. This could be one of the biggest buying opportunities of this decade, especially for those who get in early.

See the 5 high-tech stocks now>>


See More Zacks Research for These Tickers


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NVIDIA Corporation (NVDA) - free report >>

Adobe Inc. (ADBE) - free report >>

CDW Corporation (CDW) - free report >>

Dropbox, Inc. (DBX) - free report >>

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