CDW
CDW Corporation
$133.82
Platform & Compounding FCF
50%
Two-stage FCF DCF
Moderate
·
Conviction
Overvalued
Trading 31.2% above fair value
You pay
$133.82
Bear
$78.73
Fair
$101.97
Bull
$122.30
Bear
$78.73
-41.2%
3% stage 1 growth, 11% discount
Fair
$101.97
-23.8%
6% stage 1 growth, 11% discount
Bull
$122.30
-8.6%
7% stage 1 growth, 11% discount
Key Value Driver
FCF growth rate (6% base case)
Terminal Value % of EV
35%
Implied Market Multiple
21.0x
Market is pricing in (growth)
9.6%
vs 5.6% base
Summary
Our base-case estimate uses a two-stage discounted cash flow model based on free cash flow. We then blend that result with the average analyst price target of $144.00 from 18 analysts, using a 25% weight on analyst consensus. That produces an estimated intrinsic value of $101.97 per share.
Warnings
Wall Street's average price target is $144.00 (from 18 analysts). Our estimate is 39% below the consensus -- consider that gap carefully.
Key Risks
- P/E alone misleads — earnings depressed by growth investment
- Cyclical or commodity businesses may be misclassified as platforms
- Terminal value dominance suggests sensitivity to long-run assumptions