DCF Studio

    CDW · NMS · Technology

    CDW Corporation

    Also onShortfallConsensus DriftCrosscheck

    Implied value per share

    USD 179.20

    Market price

    USD 150.59

    Implied upside

    +19.0%

    10-year forecast · Perpetuity growth terminal value · Mid-year discounting · Base case · Price 2026-11-02 · Accounts to 2025-12-31

    AdjustedReported capital expenditure averages just 0.58% of revenue, which is too low to be the company's real investment - property trusts and similar structures invest through lines that are not reported as capex. Capex has been set to 1.00% of revenue so the forecast is not handed free growth. Override it if the reported figure is right.

    Value Per Share

    Perpetuity growth
    USD 179.20+19.0%
    Exit multiple
    USD 176.33+17.1%
    Market price
    USD 150.59

    Same forecast, different terminal treatment. Percentages vs price.

    Forecast Cashflows

    Reporting currency (USD). Outflows negative.

    0bn1bn2bnFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35
    Nominal FCFFDiscounted to todayUSD
    LineFY26FY27FY28FY29FY30FY31FY32FY33FY34FY35CAGR
    RevenueUSD 24.3bnUSD 25.2bnUSD 26.2bnUSD 27.1bnUSD 28.0bnUSD 28.9bnUSD 29.8bnUSD 30.6bnUSD 31.4bnUSD 32.2bn+3.2%
    EBITUSD 1.8bnUSD 1.9bnUSD 2.0bnUSD 2.1bnUSD 2.1bnUSD 2.2bnUSD 2.3bnUSD 2.3bnUSD 2.4bnUSD 2.5bn+3.2%
    NOPATUSD 1.5bnUSD 1.5bnUSD 1.6bnUSD 1.6bnUSD 1.7bnUSD 1.7bnUSD 1.8bnUSD 1.8bnUSD 1.9bnUSD 1.9bn+3.2%
    Add depreciation & amortisationUSD 311.0mUSD 323.1mUSD 335.1mUSD 346.9mUSD 358.5mUSD 370.0mUSD 381.1mUSD 392.0mUSD 402.4mUSD 412.5m+3.2%
    Less capital expenditureUSD -243.0mUSD -259.9mUSD -277.4mUSD -295.2mUSD -313.4mUSD -332.0mUSD -350.9mUSD -369.9mUSD -389.2mUSD -408.5m+5.9%
    Capex, % of revenue1.0%1.0%1.1%1.1%1.1%1.1%1.2%1.2%1.2%1.3%-
    Less increase in working capitalUSD -209.1mUSD -104.8mUSD -104.0mUSD -102.8mUSD -101.3mUSD -99.3mUSD -97.0mUSD -94.2mUSD -91.0mUSD -87.5m-9.2%
    Free cashflow to firmUSD 1.3bnUSD 1.5bnUSD 1.5bnUSD 1.6bnUSD 1.6bnUSD 1.7bnUSD 1.7bnUSD 1.8bnUSD 1.8bnUSD 1.9bn+3.8%
    Discount factor0.96300.89310.82830.76820.71250.66080.61280.56830.52710.4888-
    Present valueUSD 1.3bnUSD 1.3bnUSD 1.3bnUSD 1.2bnUSD 1.2bnUSD 1.1bnUSD 1.1bnUSD 1.0bnUSD 954.6mUSD 905.7m-
    Present Value Of The ForecastUSD 11.2bn

    Discount Rate

    Source shown per component. All overridable above.

    Risk-free rate4.89%US 10-year Treasury (^TNX), 2026-11-02
    Equity risk premium4.23%Damodaran, January 2026
    Beta0.949Reported 0.924, pulled toward 1.0 (Blume)
    Cost of equity8.91%Risk-free + beta x equity risk premium
    Cost of debt5.44%Risk-free + 55bp, the spread for a AA rating at 7.3x interest cover. Book interest / average debt was lower, at 3.9%.
    Market capitalisationUSD 18.8bn76.5% of capital
    Total debtUSD 5.8bn23.5% of capital, book value as a proxy
    Tax rate21.0%Effective, capped at statutory
    WACC7.83%E/V x Re + D/V x Rd x (1 - t)

    Terminal Value

    Perpetuity growth is intrinsic. The exit multiple defaults to the company's current EV/EBITDA, so it answers a different question - what the shares are worth if today's rating holds and EBITDA grows as forecast.

    Perpetuity growth at 2.50%

    Value per shareUSD 179.20

    61% of EV

    Forecast FCFF, final year
    USD 1.9bn
    Capex at depreciation, working capital in reinvestment
    USD 2.2bn
    Less reinvestment at g/ROIC (15.1% of NOPAT)
    USD -331.6m
    Capitalised
    USD 1.9bn
    ROIC (reported)
    16.6%
    Terminal value, undiscounted
    USD 36.0bn
    Terminal value, discounted
    USD 17.6bn
    Enterprise value
    USD 28.8bn
    Less net debt
    USD 5.2bn
    Equity value
    USD 23.7bn

    Exit at 12.3x EBITDA

    Value per shareUSD 176.33

    60% of EV

    Terminal value, undiscounted
    USD 35.2bn
    Terminal value, discounted
    USD 17.2bn
    Enterprise value
    USD 28.5bn
    Less net debt
    USD 5.2bn
    Equity value
    USD 23.3bn

    Spread between methods: 2%.

    Sensitivity

    Value per share (USD) by discount rate and long-run growth.

    Long-run growth
    Discount rate1.50%2.00%2.50%3.00%3.50%
    5.83%264.83283.74308.72343.00392.59
    6.83%207.12216.79228.98244.68265.46
    7.83%167.73172.88179.20187.08197.05
    8.83%139.16141.87145.18149.24154.28
    9.83%117.49118.81120.45122.48124.99

    Outlined: this model. Green text: above today's price of 150.59. Shading: distance from this model's own value.

    Priced In

    What each input would have to be to justify the current price, one at a time.

    InputActualModelImplied
    Revenue growth, a year-1.9%3.7%1.9%
    EBIT margin7.9%7.6%6.5%
    Discount rate-7.8%8.6%
    Download as Excel

    Live formulas, not pasted numbers - edit a driver and the workbook reprices.

    Yahoo Finance and RBA data. General information, not advice. Methodology.