Unpacking Q2 Earnings: CDW (NASDAQ:CDW) In The Context Of Other IT Distribution & Solutions Stocks

Earnings results often indicate what direction a company will take in the months ahead. With Q2 behind us, let’s have a look at CDW (NASDAQ:CDW) and its peers.

IT Distribution & Solutions will be buoyed by the increasing complexity of IT ecosystems, rising cloud adoption, and demand for cybersecurity solutions. Enterprises are less likely than ever to embark on these complicated journeys solo, and companies in the sector boast expertise and scale in these areas. However, cloud migration also means less need for hardware, which could dent demand for large portions of the product portfolio and hurt margins. Additionally, planning for potentially supply chain disruptions is ongoing, as the COVID-19 pandemic showed how damaging a pause in global trade could be in areas like semiconductor procurement.

The 8 it distribution & solutions stocks we track reported a strong Q2. As a group, revenues beat analysts’ consensus estimates by 6% while next quarter’s revenue guidance was in line.

In light of this news, share prices of the companies have held steady as they are up 2.1% on average since the latest earnings results.

CDW (NASDAQ:CDW)

Serving as a crucial bridge between technology manufacturers and end users since 1984, CDW (NASDAQ:CDW) is a multi-brand provider of information technology solutions that helps businesses and public sector organizations select, implement, and manage hardware, software, and IT services.

CDW reported revenues of $5.98 billion, up 10.2% year on year. This print exceeded analysts’ expectations by 7.8%. Overall, it was a very strong quarter for the company with a beat of analysts’ EPS estimates.

"The team delivered strong performance as we helped customers navigate dynamic market conditions and accomplish mission critical outcomes across the full IT stack and lifecycle," said Christine A. Leahy, chair and chief executive officer, CDW.

Unsurprisingly, the stock is down 2.2% since reporting and currently trades at $161.56.

Is now the time to buy CDW? Access our full analysis of the earnings results here, it’s free.

Best Q2: ePlus (NASDAQ:PLUS)

Starting as a financing company in 1990 before evolving into a full-service technology provider, ePlus (NASDAQ:PLUS) provides comprehensive IT solutions, professional services, and financing options to help organizations optimize their technology infrastructure and supply chain processes.

ePlus reported revenues of $637.3 million, up 19% year on year, outperforming analysts’ expectations by 23.3%. The business had an incredible quarter with a beat of analysts’ EPS estimates.

ePlus achieved the biggest analyst estimates beat and fastest revenue growth among its peers. The market seems happy with the results as the stock is up 14.2% since reporting. It currently trades at $72.46.

Is now the time to buy ePlus? Access our full analysis of the earnings results here, it’s free.

Weakest Q2: Insight Enterprises (NASDAQ:NSIT)

With over 35 years of IT expertise and partnerships with more than 8,000 technology providers, Insight Enterprises (NASDAQ:NSIT) provides end-to-end digital transformation solutions that help businesses modernize their IT infrastructure and maximize the value of technology.

Insight Enterprises reported revenues of $2.09 billion, down 3.2% year on year, falling short of analysts’ expectations by 2.4%. It was a slower quarter as it posted a miss of analysts’ EPS estimates.

Insight Enterprises delivered the weakest performance against analyst estimates and slowest revenue growth in the group. As expected, the stock is down 12% since the results and currently trades at $127.43.

Read our full analysis of Insight Enterprises’s results here.

Avnet (NASDAQ:AVT)

With a century-long history of adapting to technological evolution, Avnet (NASDAQ:AVT) is a global electronic components distributor that connects manufacturers of semiconductors and other electronic parts with businesses that need these components.

Avnet reported revenues of $5.62 billion, flat year on year. This number beat analysts’ expectations by 4.5%. Zooming out, it was a satisfactory quarter as it also logged a beat of analysts’ EPS estimates but a significant miss of analysts’ EPS guidance for next quarter estimates.

The stock is down 1.7% since reporting and currently trades at $51.

Read our full, actionable report on Avnet here, it’s free.

Ingram Micro (NYSE:INGM)

Operating as the crucial link in the global technology supply chain with a presence in 57 countries, Ingram Micro (NYSE:INGM) is a global technology distributor that connects manufacturers with resellers, providing hardware, software, cloud services, and logistics expertise.

Ingram Micro reported revenues of $12.79 billion, up 10.9% year on year. This print topped analysts’ expectations by 6.4%. Zooming out, it was a slower quarter as it recorded a significant miss of analysts’ EPS estimates and revenue guidance for next quarter slightly missing analysts’ expectations.

The stock is up 1.1% since reporting and currently trades at $19.04.

Read our full, actionable report on Ingram Micro here, it’s free.

Market Update

In response to the Fed’s rate hikes in 2022 and 2023, inflation has been gradually trending down from its post-pandemic peak, trending closer to the Fed’s 2% target. Despite higher borrowing costs, the economy has avoided flashing recessionary signals. This is the much-desired soft landing that many investors hoped for. The recent rate cuts (0.5% in September and 0.25% in November 2024) have bolstered the stock market, making 2024 a strong year for equities. Donald Trump’s presidential win in November sparked additional market gains, sending indices to record highs in the days following his victory. However, debates continue over possible tariffs and corporate tax adjustments, raising questions about economic stability in 2025.

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