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CDW Corporation (CDW)

Company Dividend Discount ModelIndustry: Information Technology ServicesSector: Technology

Valuation Snapshot

Stable Growth$160.44 - $366.11$233.66
Multi-Stage$126.38 - $138.01$132.09
Blended Fair Value$182.88
Current Price$159.28
Upside14.81%
DecisionDon't Buy

Dividend History & Growth Metrics (10Y)

Metric5Y CAGR10Y CAGR2024202320222021202020192018201720162015
DPS12.61%25.75%2.502.422.121.771.651.381.050.800.590.40
YoY Growth--3.30%13.77%20.36%6.92%19.74%31.56%30.40%35.83%48.77%57.44%
Dividend Yield--1.56%0.96%1.09%0.99%1.00%1.48%1.06%1.14%1.03%0.96%

Stable Growth Model (Adjusted)

(USD in Millions except Per Share Data)
Net Income To Common (M)1,051.30
(-) Cash Dividends Paid (M)413.30
(=) Cash Retained (M)638.00
MetricLOWBASEHIGH
Required Retention Ratio20.0%12.5%7.5%
(=) Cash Required (M)210.26131.4178.85
Cash Retained (M)638.00638.00638.00
(-) Cash Required (M)-210.26-131.41-78.85
(=) Excess Retained (M)427.74506.59559.15
(/) Shares Outstanding (M)133.03133.03133.03
(=) Excess Retained per Share3.223.814.20
LTM Dividend per Share3.113.113.11
(+) Excess Retained per Share3.223.814.20
(=) Adjusted Dividend6.326.927.31
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate4.94%5.94%6.94%
Fair Value$160.44$233.66$366.11
Upside / Downside0.73%46.70%129.85%

Multi-Stage Model: Projections

(USD in Millions)
MetricTTMDec-27Dec-28Dec-29Dec-30Dec-31Terminal
Net Income (M)1,051.301,113.801,180.011,250.151,324.471,403.201,445.30
Payout Ratio39.31%49.45%59.59%69.73%79.86%90.00%92.50%
Projected Dividends (M)413.30550.78703.14871.671,057.761,262.881,336.90

Multi-Stage Valuation

MetricLOWBASEHIGH
WACC / Discount Rate9.08%9.08%9.08%
Growth Rate4.94%5.94%6.94%
Year 1 PV (M)500.16504.93509.70
Year 2 PV (M)579.85590.95602.16
Year 3 PV (M)652.77671.61690.81
Year 4 PV (M)719.33747.15775.76
Year 5 PV (M)779.91817.78857.11
PV of Terminal Value (M)13,579.2814,238.7114,923.50
Equity Value (M)16,811.3117,571.1318,359.04
Shares Outstanding (M)133.03133.03133.03
Fair Value$126.38$132.09$138.01
Upside / Downside-20.66%-17.07%-13.35%

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