CDW Corporation Sees Institutional Inflows Following Earnings Beat and Dividend Hike
Institutional investors expanded their stakes in CDW Corporation following strong third-quarter financial results, an increased dividend payout, and multiple analyst price target increases.
Institutional investors have continued to increase their positions in CDW Corporation following the company's recent quarterly performance. In regulatory filings, New York Life Investment Management LLC reported that it raised its holdings in the technology provider by 712.3% during the third quarter, adding 127,164 shares to reach a total of 145,016 shares valued at $18,585,000. Other firms including Retirement Systems of Alabama, Commonwealth Equity Services LLC, and Vestor Capital LLC also reported substantial additions to their positions. Institutional investors and hedge funds collectively hold 93.15% of the company's stock.
The institutional buying follows CDW's quarterly financial report released on Wednesday, November 4th. The company posted earnings per share of $3.26, exceeding analyst expectations of $2.98 by $0.28. Quarterly revenue climbed 17.7% year over year to $6.75 billion, topping consensus estimates of $6.19 billion. During the same period in the prior year, the business recorded earnings of $2.71 per share. For the recent quarter, CDW generated a return on equity of 52.23% and a net margin of 4.48%. On average, research analysts anticipate the company will report 10.33 earnings per share for the current fiscal year.
Alongside its earnings beat, CDW declared a boost to its quarterly dividend. The company raised the payout from $0.63 to $0.68 per share, which equates to an annualized dividend of $2.72. Shareholders of record on Wednesday, November 25th will receive the payment on Thursday, December 10th. The ex-dividend date is also set for Wednesday, November 25th. CDW's dividend payout ratio stands at 29.40%.
Wall Street brokerages have updated their outlooks on CDW following the announcements. On Thursday, November 5th, JPMorgan Chase & Co. raised its target price from $170.00 to $195.00 with an overweight rating, while UBS Group lifted its target from $159.00 to $195.00 with a buy rating. Citigroup also increased its target price from $150.00 to $170.00 while maintaining a neutral rating. MarketBeat reported an overall consensus rating of Moderate Buy for the stock, with an average target price of $167.38 based on one strong buy, five buy, and three hold ratings.