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CDW Closes Sirius Buyout, Boosts Managed Services Capabilities

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CDW Corporation CDW recently announced the completion of the previously-announced acquisition of Sirius Computer Solutions, Inc., a leading provider of secure, mission-critical technology-based solutions. The company had entered into a definitive agreement in October 2021 to buy Sirius from an affiliate of Clayton, Dubilier & Rice for $2.5 billion in cash.

Sirius to Boost CDW’s Managed Services Capabilities

The acquisition of Sirius is anticipated to bolster CDW’s capabilities in the managed services space. It will enhance its services and solutions offerings in key growth areas, including hybrid infrastructure, digital and data innovation, security and cloud services.

The integration will boost CDW’s client base by adding Sirius’ approximately 3,900 large- and mid-sized customers. Moreover, the buyout will bring in 2,600 Sirius employees, thereby boosting CDW’s deep technical expertise in the aforementioned key growth areas.

The transaction is expected to be accretive to CDW’s revenues, gross and operating margins, and earnings per share. Sirius Computer generated total revenues of $2.04 billion in 2020.

CDW Corporation Price and Consensus

CDW Corporation Price and Consensus
CDW Corporation Price and Consensus

CDW Corporation price-consensus-chart | CDW Corporation Quote

Growing Through Acquisitions

CDW relies on acquisitions to supplement its organic growth. Earlier this year, the company acquired an education consultancy firm, Amplified IT, for an undisclosed amount to help customers maximize their return on investments in education technology.

Amplified IT is a leading K12 Services Partner of Google. The company has also received the Google Cloud Global Partner Award for Customer Success for Education. The integration of Amplified IT’s expertise in educator support and technical skills with CDW’s scale and significant market position in education will likely help schools leverage technology to achieve more efficient educational outcomes.

In 2020, CDW’s buyout of cloud-native services, software development solutions provider, IGNW, strengthened its capabilities to support customers’ digital transformations.

In 2019, the acquisition of Aptris enhanced the company’s IT Service Management solution capabilities, including consulting, advisory and development services. Also, the buyout of Scalar Decisions broadened CDW Canada’s solutions portfolio, fortified its technical skillset and extended its geographic reach.

Zacks Rank & Other Stocks to Consider

Currently, CDW carries a Zacks Rank #2 (Buy).

Some other top-ranked stocks from the broader technology sector include Google-parent Alphabet GOOGL, Diodes DIOD and PTC Inc. PTC, each sporting 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 Alphabet’s fourth-quarter 2021 earnings has been revised downward by a penny to $26.71 per share over the past seven days. For 2021, earnings estimates have moved upward by 43 cents to $108.29 per share in the last seven days.

Alphabet’s earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 41.5%. GOOGL stock has rallied 62.1% year to date (YTD).

The Zacks Consensus Estimate for Diodes’ fourth-quarter 2021 earnings has been revised upward by 23.9% to $1.45 per share over the past 30 days. For 2021, earnings estimates have moved upward by 6.3% to $5.06 per share over the past 30 days.

Diodes’ earnings beat the Zacks Consensus Estimate in the preceding four quarters, the average surprise being 10%. Shares of DIOD have rallied 53.3% YTD.

The consensus mark for PTC’s first-quarter fiscal 2022 earnings has been revised downward to $1.00 per share from $1.04 30 days ago. For fiscal 2022, earnings estimates have been revised upward by 9 cents to $4.19 per share in the last 30 days.

PTC’s earnings beat the Zacks Consensus Estimate thrice in the preceding four quarters while missing the same on one occasion, the average surprise being 47.8%. Shares of PTC have declined 5.6% YTD.


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