Tech Services Firm Beats Earnings Target But Sales Light – Investor's Business Daily

BREAKING: Futures Mixed, But Several Big Winners, Losers On News
Tech services firm and value-added reseller CDW (CDW) on Wednesday beat Wall Street’s target for earnings in the third quarter but its sales were a bit light. CDW stock fell on the news.
The Lincolnshire, Ill.-based company earned an adjusted $2.13 a share on sales of $5.3 billion in the September quarter. Analysts had expected CDW earnings of $2.05 a share on sales of $5.32 billion, according to FactSet. On a year-over-year basis, CDW earnings rose 16% while sales climbed 11%.
Sales to corporate customers rose 25% to $2.07 billion in the third quarter. Sales to small businesses increased 39% to $467 million.
However, sales to public sector customers, including government, education and health care, fell 6% to $2.15 billion. Government sales tumbled 33% year over year to $569 million in the third quarter. Education sales increased 2% to $1.1 billion. Health care sales jumped 31% to $482 million.
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“Given this quarter’s results and our expectations for the balance of the year, we now expect 2021 constant currency non-GAAP net income per diluted share growth in the high-teens,” Chief Financial Officer Albert Miralles said in a news release.
On the stock market today, CDW stock dropped 1.9% to close at 185.54. On Tuesday, CDW stock rose 0.8% to close at 189.21.
CDW stock has formed a cup-with-handle base with a buy point of 193.21, according to IBD MarketSmith charts.
CDW is a leading multi-brand provider of information technology solutions to business, government, education and health-care customers in the U.S, U.K. and Canada.
The company has been growing organically and through acquisitions. On Oct. 18, CDW announced a deal to buy IT systems integrator Sirius Computer Solutions for $2.5 billion. Based in San Antonio, Texas, Sirius generated 2020 sales of $2.04 billion. The companies expect the deal to close in December.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
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10/18/2021 CDW saw its IBD SmartSelect Composite Rating rise to 97 Tuesday, up from 94 the day before.
10/18/2021 CDW saw its IBD SmartSelect Composite Rating rise to 97…
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