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CDW Corporation (CDW - Free Report) reported fourth-quarter 2022 non-GAAP earnings of $2.50 per share, beating the Zacks Consensus Estimate of $2.45 and increasing 20.6% year over year.
The company’s revenues decreased 1.8% year over year to $5.438.3 billion. Net sales decreased 0.4% at constant currency. The downtick was caused due to weakness in Small Business and Public segment. Also, unfavorable currency translations acted as a dampener. Quarterly revenues failed to beat the consensus mark of $6.151 billion.
In 2022, total revenues came in at $23.75 billion compared with $20.82 billion in 2021, representing a rise of 14.1% year over year. Also, for 2022, the company reported non-GAAP earnings of $9.79 compared with $7.97 in 2021.
Separately, the company announced that its board of directors hiked its quarterly cash dividend by 18% to 59 cents per share. The dividend will be payable on Mar 10 to shareholders of record as of Feb 24. Also, the company announced that its board of directors had increased the share repurchase program by $750 million.
Net sales of CDW’s Corporate segment amounted to $2.484 billion, rising 6.9% on a year-over-year basis.
The Small Business segment’s net sales of $424 million declined 13.1% year over year.
The Public segment’s net sales amounted to $1.851 billion, down 8.7% from the year-earlier quarter’s levels. Revenues from Education customers dropped 30.9%. Revenues from Healthcare and Government customers were up 8.1% and 13.5%, respectively.
Net sales in Other (Canadian and U.K. operations) declined 2.7% to $680 million.
CDW’s gross profit of $1.181 million increased 21.1% on a year-over-year basis. The gross margin expanded 410 basis points (bps) to 21.7%, mainly due to a favorable product mix and rate.
The non-GAAP operating income increased 23.2% year over year to $523.1 million. Additionally, the non-GAAP operating margin advanced 190 bps to 9.6%.
Selling and administrative expenses rose 15.4% year over year to $735 million, primarily due to higher sales payroll expenses, increased coworker count and higher intangible asset amortization.
Balance Sheet and Cash Flow
As of Dec 31, 2022, CDW had $315.2 million of cash and cash equivalents compared with $384.6 million as of Sep 30.
The company has a long-term debt of $5.87 billion, lower than $6.1 billion as of Sep 30, 2022.
For the year that ended on Dec 31, 2022, CDW generated $1.335.9 billion of cash flow from operating activities compared with $784.6 million in the comparable period in the prior fiscal.
The Zacks Consensus Estimate for Arista Networks 2022 earnings is pegged at $4.38 per share, rising 0.2 in the past 60 days. The long-term earnings growth rate is anticipated to be 17.5%.
Arista Networks’ earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 12.7%. Shares of ANET have increased 4.3% in the past year.
The Zacks Consensus Estimate for Jabil’s 2023 earnings is pegged at $8.37 per share, rising 2.3% in the past 60 days. The long-term earnings growth rate is anticipated to be 12%.
Jabil’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average being 8.8%. Shares of JBL have increased 32.3% in the past year.
The Zacks Consensus Estimate for Bandwidth 2022 earnings is pegged at 37 cents per share, unchanged in the past 60 days. The long-term earnings growth rate is anticipated to be 25%.
BAND's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 301.8%. Shares of the company have declined 57.7% in the past year.
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CDW's Q4 Earnings Beat Estimates, Revenues Decrease Y/Y
CDW Corporation (CDW - Free Report) reported fourth-quarter 2022 non-GAAP earnings of $2.50 per share, beating the Zacks Consensus Estimate of $2.45 and increasing 20.6% year over year.
The company’s revenues decreased 1.8% year over year to $5.438.3 billion. Net sales decreased 0.4% at constant currency. The downtick was caused due to weakness in Small Business and Public segment. Also, unfavorable currency translations acted as a dampener. Quarterly revenues failed to beat the consensus mark of $6.151 billion.
In 2022, total revenues came in at $23.75 billion compared with $20.82 billion in 2021, representing a rise of 14.1% year over year. Also, for 2022, the company reported non-GAAP earnings of $9.79 compared with $7.97 in 2021.
Separately, the company announced that its board of directors hiked its quarterly cash dividend by 18% to 59 cents per share. The dividend will be payable on Mar 10 to shareholders of record as of Feb 24. Also, the company announced that its board of directors had increased the share repurchase program by $750 million.
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 $2.484 billion, rising 6.9% on a year-over-year basis.
The Small Business segment’s net sales of $424 million declined 13.1% year over year.
The Public segment’s net sales amounted to $1.851 billion, down 8.7% from the year-earlier quarter’s levels. Revenues from Education customers dropped 30.9%. Revenues from Healthcare and Government customers were up 8.1% and 13.5%, respectively.
Net sales in Other (Canadian and U.K. operations) declined 2.7% to $680 million.
CDW’s gross profit of $1.181 million increased 21.1% on a year-over-year basis. The gross margin expanded 410 basis points (bps) to 21.7%, mainly due to a favorable product mix and rate.
The non-GAAP operating income increased 23.2% year over year to $523.1 million. Additionally, the non-GAAP operating margin advanced 190 bps to 9.6%.
Selling and administrative expenses rose 15.4% year over year to $735 million, primarily due to higher sales payroll expenses, increased coworker count and higher intangible asset amortization.
Balance Sheet and Cash Flow
As of Dec 31, 2022, CDW had $315.2 million of cash and cash equivalents compared with $384.6 million as of Sep 30.
The company has a long-term debt of $5.87 billion, lower than $6.1 billion as of Sep 30, 2022.
For the year that ended on Dec 31, 2022, CDW generated $1.335.9 billion of cash flow from operating activities compared with $784.6 million in the comparable period in the prior fiscal.
Zacks Rank & Other Stocks to Consider
CDW currently carries a Zacks Rank #2 (Buy).
Some other top-ranked stocks in the broader technology space are Arista Networks (ANET - Free Report) , Jabil (JBL - Free Report) and Bandwidth (BAND - Free Report) . Jabil sports a Zacks Rank #1 (Strong Buy), while Arista Networks and Bandwidth carry a Zacks Rank #2. You can see the complete list of today’s Zacks #1 Rank stocks here.
The Zacks Consensus Estimate for Arista Networks 2022 earnings is pegged at $4.38 per share, rising 0.2 in the past 60 days. The long-term earnings growth rate is anticipated to be 17.5%.
Arista Networks’ earnings beat the Zacks Consensus Estimate in the last four quarters, the average being 12.7%. Shares of ANET have increased 4.3% in the past year.
The Zacks Consensus Estimate for Jabil’s 2023 earnings is pegged at $8.37 per share, rising 2.3% in the past 60 days. The long-term earnings growth rate is anticipated to be 12%.
Jabil’s earnings beat the Zacks Consensus Estimate in all the last four quarters, the average being 8.8%. Shares of JBL have increased 32.3% in the past year.
The Zacks Consensus Estimate for Bandwidth 2022 earnings is pegged at 37 cents per share, unchanged in the past 60 days. The long-term earnings growth rate is anticipated to be 25%.
BAND's earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average surprise being 301.8%. Shares of the company have declined 57.7% in the past year.