AI interpretation based on checked source excerpts. Issuer assertions and evidence limitations remain explicit.
Policy quality-scores-3: six equally weighted categories. The overall score requires full coverage. Missing inputs are not zero. Qualitative grades are sourced interpretations, not probabilities. 6/6 · 31/10/2026
Moat44
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
structural advantage · 2/4 · Over 250,000 customers, substantial distribution throughput and approximately 10,500 customer-facing coworkers establish meaningful operating capabilities. They plausibly support scale and expertise advantages, but no relative cost, exclusivity or competitive outcome establishes structural superiority. Fragmented markets and competing direct channels temper the assessment.
durability · 1/4 · CDW's installed capabilities and some multi-year contractual commitments support current relevance. Their defensibility is fragile: technology expertise requires continued adaptation, vendor authorization models can change, and vendor programs remain discretionary. These are disclosed dependencies rather than realized failures; sustained protection from replication is not demonstrated.
customer dependency · 2/4 · Non-cancelable managed and professional services contracts longer than 12 months demonstrate bounded customer commitment. Software agreement and renewal assistance provides continuing engagement. This supports some dependency within services, but the passages do not establish migration costs, actual renewal outcomes or dependence across CDW's broader customer base.
erosion resilience · 2/4 · For the six months ended June 30, 2026, sales, gross profit and operating income grew despite competitive and vendor dependencies. Second-quarter hardware mix and category margin pressure show incomplete protection. This demonstrates some operating resilience, while neither market-share defense nor durable resistance to channel substitution is established.
Pricing power44
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
realized pricing · 1/4 · CDW discloses experienced customer price sensitivity, while second-quarter 2026 gross margin pressure included lower margins within certain hardware categories as well as mix. Together these support fragile pricing economics. They do not isolate selling-price changes from procurement costs, and aggregate margin compression alone is not treated as proof of weak pricing.
retention · 2/4 · Non-cancelable services contracts longer than 12 months demonstrate continuing committed demand within a limited scope. Agreement and renewal assistance supports engagement, and first-half 2026 sales growth supplies indirect demand evidence. Actual renewals and same-customer retention remain undisclosed; broad lock-in or a retention rate cannot be inferred.
margin resilience · 2/4 · For the six months ended June 30, 2026, gross profit increased to $2,509.8 million from $2,363.5 million and operating income to $804.6 million from $781.6 million. Profit dollars held up, but second-quarter gross margin fell from 20.8% to 20.1%. Mix, category pressure and discretionary vendor support limit resilience.
contractual freedom · 2/4 · Pricing discretion appears among the indicators assessed for principal transactions, providing limited evidence of pricing authority rather than unrestricted repricing rights. Vendor agreements can include discounts, price protection and incentives, while cooperative advertising programs remain vendor-controlled. The combined disclosures support mixed control over economic terms.
Predictability85
5 consecutive published annual periods. Equal weights: nondeclining revenue frequency; revenue-growth volatility (5–40pp); positive FCF frequency; FCF-margin volatility (3–20pp). Stability indicator, not a growth forecast.
- Nondeclining revenue years (%)
- 50.00
- Revenue growth volatility (pp)
- 9.03
- Positive FCF years (%)
- 100.00
- FCF margin volatility (pp)
- 1.13
- observedAnnualPeriods
- 5.00
Financial strength38
Equal-weight grades: debt/FCF (1–8x), net debt/earnings before interest and tax (0–5x), interest service (1–12x), current ratio (0.75–2x). Earnings use reported operating income, an original issuer-reported unadjusted EBIT reconciled to net income, income tax and signed net interest, or reported pretax profit plus reported gross interest expense. Reported EBIT is distinct from GAAP operating income and gross interest. Interest service uses earnings/interest expense; if unavailable, it uses reported operating cash flow/cash interest paid, without relabeling cash paid as accrued expense. Nonpositive cash flow/earnings score 0 for their service component; reported zero interest with a positive numerator scores 100. Net cash scores 100 for net leverage. Missing disclosures remain unavailable. General nonfinancial-company rubric, not a credit rating; exceptional and nonoperating gains are not normalized out. IFRS finance-cost and cash-flow classifications retain their reported scope.
- debtFcfGrade
- 40.37
- netDebtEbitGrade
- 39.46
- interestCoverageGrade
- 37.67
- currentRatioGrade
- 34.11
- Debt / FCF (x)
- 5.17
- Net debt / operating income (x)
- 3.03
- Current ratio (x)
- 1.18
- cashInterestPaid
- 234.30
- cashInterestCoverage
- 5.14
Capital allocation97
Three-year equal-weight indicators: pretax return on average invested capital (0–25%; equity + debt − cash, each year and its prior year), share-count growth (0–5%, lower better), share-based cost/revenue (2–20%, lower better), consolidated FCF/net income (0–1x). Return uses reported operating income, an original issuer-reported unadjusted EBIT reconciled to net income, income tax and signed net interest, or EBIT calculated from reported pretax profit plus reported gross interest expense; the issuer-reported EBIT is distinct from GAAP operating income and gross interest; exceptional/nonoperating gains are not normalized out. Share-based cost uses the reported cash-flow add-back or, if absent, separately reported recognized compensation expense; the latter never becomes an FCF adjustment. Nonpositive net income scores 0 for cash conversion; absent income/FCF stays unavailable. ROIC remains undefined for nonpositive invested capital; the explicit asset-return alternative does not change the ROIC chart. Missing financial inputs alone never trigger an alternative. Does not establish acquisition quality or buyback timing.
- 3-year pre-tax operating return (%)
- 22.48
- 3-year average dilution (%)
- -0.97
- 3-year average SBC / revenue (%)
- 0.37
- cashConversionGrade
- 100.00
Management63
Equal-weight average of four evidence-backed rubric grades (0–4), scaled to 100.
capital discipline · 2/4 · Operating cash generation was substantial in 2025, but fell to $219.7 million in first-half 2026 as receivables and inventory absorbed cash. First-half capital expenditures were $53.9 million; repurchases continued alongside higher average revolving debt. These actual financing and spending outcomes support a mixed assessment without establishing acquisition or repurchase returns.
incentive alignment · 3/4 · Disclosed policies include performance-linked compensation, double-trigger vesting, clawbacks and prohibitions on hedging and pledging. Continuing named executive officers complied with ownership guidelines, whose stated multiples are six times salary for the CEO and three times for other executives. These establish strong formal alignment; specific award outcomes and complete beneficial ownership remain unverified.
execution · 2/4 · First-half 2026 sales, gross profit and operating income increased, providing indirect operating evidence of execution. Lower hardware category margins and materially weaker operating cash generation temper those achievements. The passages do not isolate management's contribution from demand, mix or currency, or demonstrate sustained competitive gains.
governance · 3/4 · Annual elections, independent key committees, proxy access and majority voting provide strong formal safeguards. Written-consent bylaws took effect May 22, 2026; the October board appointment included an independence determination. The combined chair and CEO role limits separation, and disclosed governance structures do not establish exceptional oversight outcomes.
Evidence
Our value proposition to our vendor partners
●
Broad selection of products and multi-branded IT solutions
●
Access to over 250,000 customers
●
Value-added services with integration capabilities
●
Large and established customer channels
●
Highly-skilled specialists and engineers
●
Strong distribution and implementation capabilities
●
Solutions across IT lifecycle
●
Customer relationships driving insight into technology roadmaps
●
Industry vertical expertise
●
Industry vertical expertise
Customers
We provide integrated IT solutions to over 250,000 business, government, education, and healthcare customers throughout the US, UK, and Canada.
2025 Form 10-K, filed 2026-02-20, Business—Value Proposition and Customers · Filed 20/02/2026
Inventory Management
We operate two distribution centers in North America and one distribution center in the UK, which combined provide more than 1 million square feet in size.
2025 Form 10-K, filed 2026-02-20, Business—Inventory Management · Filed 20/02/2026
Leveraging our distribution and logistics capabilities, we handle and ship approximately 22 million units annually on an aggregate basis from our distribution centers.
2025 Form 10-K, filed 2026-02-20, Business—Inventory Management · Filed 20/02/2026
Each vendor partner agreement provides for specific terms and conditions, which may include one or more of the following: product return privileges, price protection policies, purchase discounts, and vendor incentive programs, such as purchase or sales rebates and cooperative advertising reimbursements.
June 2026 Form 10-Q, filed 2026-08-05, vendor partner agreement terms · Filed 05/08/2026
These are highly fragmented markets served by thousands of IT resellers and solutions providers.
2025 Form 10-K, filed 2026-02-20, Business—market fragmentation · Filed 20/02/2026
We face competition from resellers, manufacturers who sell directly to customers, large service providers and system integrators, cloud providers, e-commerce companies, and office supply retailers, among others.
2024 Form 10-K, filed 2025-02-21, Business—Competition · Filed 21/02/2025
These programs are at the discretion of our vendor partners and are typically tied to sales or other commitments to be met by us within a specified period of time.
June 2026 Form 10-Q, filed 2026-08-05, vendor cooperative advertising program discretion · Filed 05/08/2026
Our solutions are delivered in physical, virtual, and cloud-based environments through approximately 10,500 customer-facing coworkers, including sellers, highly-skilled specialists, and engineers.
2025 Form 10-K, filed 2026-02-20, Business—customer-facing workforce · Filed 20/02/2026
In addition to helping our customers determine the best software solutions for their needs, we help them manage their software agreements, including warranties and renewals.
June 2026 Form 10-Q, filed 2026-08-05, software agreement and renewal assistance · Filed 05/08/2026
In addition, if we are unable to anticipate and expand our capabilities to keep pace with changes in technology and new hardware, software, and services, for example by providing the appropriate training to our account managers, specialists, and engineers to enable them to effectively sell and deliver such new solutions to customers, our business, results of operations, or cash flows could be adversely affected.
2025 Form 10-K, filed 2026-02-20, risk passage—technology capabilities and training · Filed 20/02/2026
In rapidly evolving categories such as cloud-based
11
Table of Contents
solutions, AI, and software “as a service” solutions, our dependence on our vendor partners for innovation can add additional complexity as vendor channel strategies and authorization models may change more frequently.
2025 Form 10-K, filed 2026-02-20, risk passage—vendor innovation and channel authorization · Filed 20/02/2026
The following table represents the total transaction price for the remaining performance obligations as of June 30, 2026, related to non-cancelable managed and professional services contracts whereby the Company is acting as the principal and the duration is longer than 12 months, which is expected to be recognized over future periods.
June 2026 Form 10-Q, filed 2026-08-05, revenue note—scope of remaining performance obligations · Filed 05/08/2026
Supply chain pressures have and could in the future cause us to experience changes in average selling prices and our gross margins on certain products as customers have become and could in the future become more price sensitive.
2025 Form 10-K, filed 2026-02-20, risk passage—experienced customer price sensitivity · Filed 20/02/2026
(dollars and shares in millions, except per share amounts)
(unaudited)
Three Months Ended June 30,
Six Months Ended June 30,
2026
2025
2026
2025
Net sales
$
6,572.2
$
5,976.6
$
12,252.0
$
11,175.7
Cost of sales
5,252.4
4,735.4
9,742.2
8,812.2
Gross profit
1,319.8
1,241.2
2,509.8
2,363.5
Selling and administrative expenses
891.2
821.0
1,705.2
1,581.9
Operating income
428.6
420.2
804.6
781.6
Interest expense, net
(60.2)
(56.8)
(115.5)
(113.9)
Other income (expense), net
4.5
1.5
2.8
1.2
Income before income taxes
372.9
364.9
691.9
668.9
Income tax expense
(98.5)
(93.7)
(182.1)
(172.8)
Net income
$
274.4
$
271.2
$
509.8
$
496.1
Net income per common share:
Basic
$
2.16
$
2.06
$
3.98
$
3.76
Diluted
$
2.15
$
2.05
$
3.97
$
3.73
Weighted-average common shares outstanding:
Basic
127.0
131.6
128.0
132.1
Diluted
127.4
132.4
128.4
132.9
The accompanying notes are an integral part of the Consolidated Financial Statements.
June 2026 Form 10-Q, filed 2026-08-05, consolidated statements of operations—three and six months ended June 30 · Filed 05/08/2026
Gross profit margin was 20.1 percent in the second quarter of 2026 compared to 20.8 percent in the second quarter of 2025.
Second-quarter 2026 earnings release, filed 2026-08-05, gross profit margin comparison · Filed 05/08/2026
The decrease in Gross profit margin was primarily driven by mix into and lower margin in certain hardware categories, partially offset by a higher contribution of netted down revenue.
Second-quarter 2026 earnings release, filed 2026-08-05, hardware mix and category margin explanation · Filed 05/08/2026
This evaluation includes, but is not limited to, assessing indicators such as whether: (i) we are primarily responsible for fulfilling the promise to provide the specified goods or service, (ii) we have inventory risk before the specified good or service has been transferred to a customer, and (iii) we have discretion in establishing the price for the specified good or service.
2025 Form 10-K, filed 2026-02-20, revenue accounting—principal versus agent indicators · Filed 20/02/2026
Cash Flows
Cash flows from operating, investing, and financing activities are as follows:
Year Ended December 31,
(dollars in millions)
2025
2024
Net cash provided by operating activities
$
1,205.2
$
1,277.3
Net cash provided by (used in) investing activities
70.2
(659.2)
Net cash used in financing activities
(1,184.5)
(686.9)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
20.3
(12.2)
Net increase (decrease) in cash, cash equivalents, and restricted cash
$
111.2
$
(81.0)
Operating Activities
Cash flows from operating activities are as follows:
Year Ended December 31,
(dollars in millions)
2025
2024
Change
Net income
$
1,066.6
$
1,077.8
$
(11.2)
Adjustments for the impact of non-cash items(1)
424.9
362.2
62.7
Net income adjusted for the impact of non-cash items
1,491.5
1,440.0
51.5
Changes in assets and liabilities:
Accounts receivable
(1,166.5)
(559.4)
(607.1)
Merchandise inventory
48.2
61.1
(12.9)
2025 Form 10-K, filed 2026-02-20, Cash Flows—2025 and 2024 operating cash generation · Filed 20/02/2026
Cash Flows
Cash flows from operating, investing, and financing activities are as follows:
Six Months Ended June 30,
(dollars in millions)
2026
2025
Net cash provided by operating activities
$
219.7
$
443.1
Net cash (used in) provided by investing activities
(58.8)
154.6
Net cash used in financing activities
(406.2)
(649.2)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
(10.5)
25.0
Net decrease in cash, cash equivalents, and restricted cash
$
(255.8)
$
(26.5)
33
Table of Contents
Operating Activities
Cash flows from operating activities are as follows:
Six Months Ended June 30,
(dollars in millions)
2026
2025
Change
Net income
$
509.8
$
496.1
$
13.7
Adjustments for the impact of non-cash items(1)
207.6
176.6
31.0
Net income adjusted for the impact of non-cash items
717.4
672.7
44.7
Changes in assets and liabilities:
Accounts receivable
(1,054.0)
(450.1)
(603.9)
Merchandise inventory
(418.3)
(147.3)
June 2026 Form 10-Q, filed 2026-08-05, Cash Flows—six-month working capital movements · Filed 05/08/2026
CDW CORPORATION AND SUBSIDIARIES
CASH FLOW INFORMATION
(dollars in millions)
(unaudited)
Six Months Ended June 30,
2026
2025
Net cash provided by operating activities
$
219.7
$
443.1
Capital expenditures
(53.9)
(49.4)
Other cash flows (used in) provided by investing activities
(4.9)
204.0
Net cash (used in) provided by investing activities
(58.8)
154.6
Net change in accounts payable-inventory financing-supplier financing
50.6
65.2
Proceeds from accounts payable-inventory financing-product financing
62.5
—
Payments on accounts payable-inventory financing-product financing
(0.5)
—
Other cash flows used in financing activities
(518.8)
(714.4)
Net cash used in financing activities
(406.2)
(649.2)
Effect of exchange rate changes on cash, cash equivalents, and restricted cash
(10.5)
25.0
Net decrease in cash, cash equivalents, and restricted cash
(255.8)
(26.5)
Cash, cash equivalents, and restricted cash - beginning of period(i)
618.9
507.7
Cash, cash equivalents, and restricted cash - end of period(i)
$
363.1
$
481.2
Supplementary disclosure of cash flow information:
Interest paid
$
(116.9)
$
(120.4)
Income taxes paid, net
$
(202.2)
$
(163.3)
(i)Restricted cash is presented within Prepaid expenses and other on the Consolidated Balance Sheets, as applicable.
Second-quarter 2026 earnings release, filed 2026-08-05, six-month cash flow information and restricted cash footnote · Filed 05/08/2026
Information relating to the Company’s purchases of its common stock during the three months ended June 30, 2026 is as follows:
Period
Total Number of Shares Purchased
(in millions)
Average Price Paid per Share
Total Number of Shares Purchased as Part of a Publicly Announced Plan or Program
(in millions)
Approximate Dollar Value of Shares that May Yet be Purchased Under the Plans or Programs(1)
(in millions)
April 1 through April 30, 2026
0.3
$
131.16
0.3
$
441.6
May 1 through May 31, 2026
1.5
111.81
1.5
1,280.5
June 1 through June 30, 2026
1.1
133.10
1.1
1,137.9
Total
2.9
2.9
(1)The amounts presented in this column are the remaining total authorized value to be spent after each month’s repurchases.
June 2026 Form 10-Q, filed 2026-08-05, second-quarter share repurchases and authorization footnote · Filed 05/08/2026
The increase is primarily due to higher average debt levels on our senior unsecured revolving loan facility.
Second-quarter 2026 earnings release, filed 2026-08-05, higher average revolving debt · Filed 05/08/2026
Significant percentage of target direct annual compensation is variable and tied to the achievement of pre-established financial performance goals and stock price performance
●
Long-term objectives aligned with the creation of stockholder value
●
Market comparison of executive compensation against a relevant peer group
●
Use of an independent compensation consultant reporting directly to the Compensation Committee and providing no other services to the Company
●
Double-trigger vesting for equity awards in the event of a change in control under our long-term incentive plan
●
Robust stock ownership guidelines
●
Clawback provisions in the event of certain financial statement restatements or restrictive covenant breaches
●
Annual say-on-pay vote
●
Limited perquisites
●
Annual equity awards are granted following the release of the Company’s annual earnings report
What We Don’t Do
●
No 280G tax gross-up payments
●
No enhanced severance multiple upon a change in control
●
No excessive severance benefits
●
No dividends or dividend equivalents on unearned equity awards under our long-term incentive plan
●
No repricing of underwater stock options under our long-term incentive plan without stockholder approval
●
No hedging, pledging, or short sales of our securities
2025 Say-on-Pay Vote
As noted above, the Compensation Committee considers
2026 proxy, filed 2026-04-10, executive compensation policies and practices · Filed 10/04/2026
our continuing NEOs were in compliance with the Company’s stock ownership guidelines.
2026 proxy, filed 2026-04-10, continuing named executive officers' stock ownership guideline compliance · Filed 10/04/2026
Named Executive Officer
Guideline
Chair, President, and Chief Executive Officer
6x salary
Other Executive Officers
3x salary
WHAT COUNTS TOWARD THE GUIDELINE
WHAT DOES NOT COUNT TOWARD THE GUIDELINE
2026 proxy, filed 2026-04-10, executive stock ownership salary multiples · Filed 10/04/2026
Annual election of all directors
Lead Independent Director
All
of our directors, other than the Chair of our Board, are independent
2026 proxy, filed 2026-04-10, annual director elections and board independence · Filed 10/04/2026
100% independent Audit, Compensation, and Nominating and Corporate Governance Committees
2026 proxy, filed 2026-04-10, independent key committees · Filed 10/04/2026
Our Board has approved a management proposal to allow stockholders to act by written consent (Proposal 4 in this proxy statement)
Proxy access right
Majority vote to elect directors with resignation policy
2026 proxy, filed 2026-04-10, proxy access, majority voting and proposed written consent · Filed 10/04/2026
In connection with the stockholders of the Company approving the Amendment, the Company’s Board of Directors (the “Board”) adopted Amended and Restated Bylaws of the Company (as amended, the “Bylaws”) that clarify that stockholders may act by written consent only to the extent, and subject to the terms and conditions, set forth in the Amended and Restated Certificate of Incorporation, which also became effective on May 22, 2026.
May 2026 Form 8-K, filed 2026-05-26, adopted written-consent bylaws effective May 22, 2026 · Filed 26/05/2026
Director. The Board believes that the combined role of Chair of the Board and Chief Executive Officer of our Company, together
2026 proxy, filed 2026-04-10, combined chair and chief executive officer role · Filed 10/04/2026
On October 15, 2026, the Board of Directors (the “Board”) of CDW Corporation (the “Company”) increased the number of directors of the Company from nine to ten and appointed Saranga (Sam) Balaji to serve as a director on the Board, effective immediately.
October 2026 Form 8-K, filed 2026-10-19, board expansion and appointment effective October 15, 2026 · Filed 19/10/2026
The Board has determined that Mr. Balaji is independent for purposes of the listing standards of the Nasdaq Global Select Market.
October 2026 Form 8-K, filed 2026-10-19, new director independence determination · Filed 19/10/2026
