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CDW to Report Q4 Earnings: Is a Beat in Store for the Stock?

Zacks Equity Research

CDW Corporation CDW is slated to release fourth-quarter 2019 results on Feb 6.

The Zacks Consensus Estimate for fourth-quarter revenues is currently pegged at $4.39 billion, indicating 7.85% growth from the year-ago reported figure. Further, the consensus mark for earnings of $1.47 suggests 11.36% rise from the year-ago reported quarter.

Let’s see how things are shaping up for the upcoming announcement.

Factors at Play

CDW’s fourth-quarter 2019 results are likely to have benefited from growth across all U.S. channels and international operations. Notably, its customer end markets as well as expanding product and technology portfolio are key drivers.

Increasing demand for its solid product and services portfolio addressing customer requirements across the IT landscape is likely to have been a constant tailwind. To this end, the company has been gaining traction immensely from its extending partner ecosystem, which comprises players, namely Apple, Adobe, Google, HP, IBM and Microsoft, et al.

CDW’s strategy to supplement organic growth alongside acquisitions is also expected to have strengthened the company profile significantly. Its latest buyouts of Aptris and Scalar Decisions have been instrumental in enhancing its capabilities to solve customers’ business problems. This makes us optimistic about the upcoming results.

However, adverse foreign currency fluctuations and macroeconomic perils are key concerns this earnings season.

CDW Corporation Price and EPS Surprise

CDW Corporation Price and EPS Surprise

CDW Corporation price-eps-surprise | CDW Corporation Quote

What Our Model Says

The proven Zacks model predicts an earnings beat for CDW this time around. The combination of a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or 3 (Hold) increases the chances of beating estimates. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.

CDW has a Zacks Rank #2 and an Earnings ESP of +2.34%.

Last Earnings Report and Surprise History

In the last reported quarter, non-GAAP earnings per share rose 19.8% year over year to $1.7 and also beat the Zacks Consensus Estimate of $1.58.

Further, revenues of $4.91 billion in the reported quarter marked a year-over-year rise of 12.2% and also topped the Zacks Consensus Estimate of $4.64 billion. Moreover, revenues were up 12.7% in constant currency (cc).

The company’s earnings beat the Zacks Consensus Estimate in each of the trailing four quarters, the average being 9.07%.

Other Stocks to Consider

Here are some other stocks worth considering as our model shows that these too have the right combination of elements to beat on earnings in their upcoming releases:

Microchip Technology Incorporated MCHP has an Earnings ESP of +1.33% and a Zacks Rank of 1. You can see the complete list of today’s Zacks #1 Rank stocks here.

CEVA CEVA has an Earnings ESP of +27.06% and is Zacks #1 Ranked.

Silicon Motion Technology Corporation SIMO has an Earnings ESP of +5.88% and is #1 Ranked.

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CDW Corporation (CDW) : Free Stock Analysis Report
 
Silicon Motion Technology Corporation (SIMO) : Free Stock Analysis Report
 
CEVA, Inc. (CEVA) : Free Stock Analysis Report
 
Microchip Technology Incorporated (MCHP) : Free Stock Analysis Report
 
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