Gross Margin % is calculated as gross profit divided by its revenue. CDW's Gross Profit for the
three
months ended in Dec. 2023 was $1,154 Mil. CDW's Revenue for the
three
months ended in Dec. 2023 was $5,019 Mil. Therefore, CDW's Gross Margin % for the quarter that ended in Dec. 2023 was 22.99%.
The historical rank and industry rank for CDW's Gross Margin % or its related term are showing as below:
CDW'
s Gross Margin % Range Over the Past 10 Years
Min: 15.91 Med: 16.95 Max: 21.77
Current: 21.77
During the past 13 years, the highestGross Margin % of CDW was 21.77%. The lowest was 15.91%. And the median was 16.95%.
CDW's Gross Margin % is ranked worse than 78.84% of 2628
companies
in the Software industry
Industry Median: 41.685
vs CDW: 21.77
CDW had a gross margin of 22.99% for the quarter that ended in Dec. 2023 => Competition eroding margins
The 5-Year average Growth Rate of Gross Margin for CDW was 5.30% per year.
CDW Gross Margin % Historical Data
The historical data trend for CDW's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
For the Information Technology Services subindustry, CDW's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
CDW Gross Margin % Distribution
For the Software industry and Technology sector, CDW's Gross Margin % distribution charts can be found below:
* The bar in red indicates where CDW's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
CDW (NAS:CDW) Gross Margin % Explanation
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
CDW had a gross margin of 22.99% for the quarter that ended in Dec. 2023 => Competition eroding margins
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
CDW Gross Margin % Related Terms
Thank you for viewing the detailed overview of CDW's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
CDW Corp is a value-added reseller operating in the U.S. (95% of sales) and Canada (5%). The company has more than 100,000 products on its line of cards that range from notebooks to data center software. Roughly half of CDW's revenue comes from midsize and large businesses, with the remaining from small businesses, government agencies, education institutions, and health-care organizations.
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