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CDW to Report Q1 Earnings: What's in Store for the Stock?
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CDW Corporation (CDW - Free Report) is scheduled to report first-quarter 2018 results on May 2, before the market opens. The question lingering in investors’ minds is whether or not the company will be able to post a positive earnings surprise in the quarter.
Notably, the company has a mixed earnings surprise history. In the trailing four quarters, the company’s results surpassed the Zacks Consensus Estimate twice and came in line in the other occasions. It has an average positive earnings surprise of 0.5%.
What the Zacks Model Unveils?
Our proven model does not conclusively show that CDW is likely to beat earnings estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) for this to happen. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
It should be noted that stocks with a Zacks Rank #4 or 5 (Sell rated) are best avoided, especially when the company is seeing negative estimate revisions.
CDW carries a Zacks Rank of 3 and has an Earnings ESP of 0.00%, which makes surprise prediction difficult. Furthermore, we noted that the Zacks Consensus Estimate for first-quarter earnings have remained unchanged over the past 30 days.
However, the company is likely to continue reporting top- and bottom-line growth on a year-over-year basis. The Zacks Consensus Estimate for the first-quarter earnings is pegged at 92 cents, which indicates year-over-year growth of 22.7%. Additionally, analysts polled by Zacks project revenues of roughly $3.46 billion, up 4.1% from the year-ago quarter.
For the past few quarters, the company has been expanding its solutions suite and enhancing services capabilities, which is likely to have positively impacted the quarterly results. Moreover, the company’s investment strategies to deliver integrated solutions both in and outside of the U.K., along with the international sales team and its international-branded website, will likely have driven its performance.
Furthermore, CDW specializes in offering information technology products and services to business, government, education and healthcare customers, primarily in the United States and Canada. Growth in customer channels and continued strategic achievements are a couple of positive factors which are likely to have been conducive to the company’s results in the to-be-reported quarter. Additionally, CDW’s robust product portfolio and product refreshes remain positives.
Also, the company’s exposure in the high-end corporate desktop and digital education implementation space is encouraging. Moreover, its focus on small & medium businesses and customer additions help expand market share.
Nonetheless, the company’s high debt burden might have weighed on the bottom-line results. As of Dec 31, 2017, the company had total debt of approximately $3.20 billion (excluding current maturities). Such high-debt levels increase leverage risks and interest costs which might dent the company’s profitability.
Stocks With Favorable Combinations
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Arrow Electronics, Inc. (ARW - Free Report) has an Earnings ESP of +0.66% and a Zacks Rank of 2.
FireEye, Inc. has an Earnings ESP of +6.67% and a Zacks Rank of 3.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
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CDW to Report Q1 Earnings: What's in Store for the Stock?
CDW Corporation (CDW - Free Report) is scheduled to report first-quarter 2018 results on May 2, before the market opens. The question lingering in investors’ minds is whether or not the company will be able to post a positive earnings surprise in the quarter.
Notably, the company has a mixed earnings surprise history. In the trailing four quarters, the company’s results surpassed the Zacks Consensus Estimate twice and came in line in the other occasions. It has an average positive earnings surprise of 0.5%.
What the Zacks Model Unveils?
Our proven model does not conclusively show that CDW is likely to beat earnings estimates this quarter. This is because a stock needs to have both a positive Earnings ESP and a Zacks Rank #1 (Strong Buy), 2 (Buy) or at least 3 (Hold) for this to happen. You can uncover the best stocks to buy or sell before they’re reported with our Earnings ESP Filter.
It should be noted that stocks with a Zacks Rank #4 or 5 (Sell rated) are best avoided, especially when the company is seeing negative estimate revisions.
CDW carries a Zacks Rank of 3 and has an Earnings ESP of 0.00%, which makes surprise prediction difficult. Furthermore, we noted that the Zacks Consensus Estimate for first-quarter earnings have remained unchanged over the past 30 days.
However, the company is likely to continue reporting top- and bottom-line growth on a year-over-year basis. The Zacks Consensus Estimate for the first-quarter earnings is pegged at 92 cents, which indicates year-over-year growth of 22.7%. Additionally, analysts polled by Zacks project revenues of roughly $3.46 billion, up 4.1% from the year-ago quarter.
CDW Corporation Price and EPS Surprise
CDW Corporation Price and EPS Surprise | CDW Corporation Quote
Factors to Consider
For the past few quarters, the company has been expanding its solutions suite and enhancing services capabilities, which is likely to have positively impacted the quarterly results. Moreover, the company’s investment strategies to deliver integrated solutions both in and outside of the U.K., along with the international sales team and its international-branded website, will likely have driven its performance.
Furthermore, CDW specializes in offering information technology products and services to business, government, education and healthcare customers, primarily in the United States and Canada. Growth in customer channels and continued strategic achievements are a couple of positive factors which are likely to have been conducive to the company’s results in the to-be-reported quarter. Additionally, CDW’s robust product portfolio and product refreshes remain positives.
Also, the company’s exposure in the high-end corporate desktop and digital education implementation space is encouraging. Moreover, its focus on small & medium businesses and customer additions help expand market share.
Nonetheless, the company’s high debt burden might have weighed on the bottom-line results. As of Dec 31, 2017, the company had total debt of approximately $3.20 billion (excluding current maturities). Such high-debt levels increase leverage risks and interest costs which might dent the company’s profitability.
Stocks With Favorable Combinations
Here are some companies you may want to consider as our model shows that these have the right combination of elements to post an earnings beat:
Seagate Technology PLC (STX - Free Report) has an Earnings ESP of +3.43% and a Zacks Rank #1. You can see the complete list of today’s Zacks #1 Rank stocks here.
Arrow Electronics, Inc. (ARW - Free Report) has an Earnings ESP of +0.66% and a Zacks Rank of 2.
FireEye, Inc. has an Earnings ESP of +6.67% and a Zacks Rank of 3.
The Hottest Tech Mega-Trend of All
Last year, it generated $8 billion in global revenues. By 2020, it's predicted to blast through the roof to $47 billion. Famed investor Mark Cuban says it will produce ""the world's first trillionaires,"" but that should still leave plenty of money for regular investors who make the right trades early.
See Zacks' 3 Best Stocks to Play This Trend >>