September 30, 2022


Melts In Your Technology

CDW to Bolster Managed Services Capabilities With Sirius Buyout

CDW Corporation CDW recently announced that it has agreed to buy Sirius Computer Solutions from an affiliate of Clayton, Dubilier & Rice, for $2.5 billion in cash. The business technology retailer expects to complete the transaction in December 2021, subject to customary closing conditions.


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The acquisition is anticipated to further bolster CDW’s capabilities in the managed services space. Moreover, it will enhance its services and solutions offerings across the key growth areas, including hybrid infrastructure, digital and data innovation, security and cloud services.

The acquisition is expected to be accretive to CDW’s revenues, gross and operating margins, and earnings per share. Notably, Sirius Computer had generated total revenues of $2.04 billion in 2020.

Additionally, the integration will boost CDW’s client base by adding Sirius Computer’s approximately 3,900 large- and mid-sized customers. Moreover, the acquisition will bring in 2,600 Sirius Computer, thereby boosting CDW’s deep technical expertise in the aforementioned key growth areas.

CDW Corporation Price and Consensus

CDW Corporation Price and Consensus

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CDW Corporation Price and Consensus

CDW Corporation price-consensus-chart | CDW Corporation Quote

CDW is looking at acquisitions to supplement its organic growth. Earlier this year, the company acquired education consultancy firm, Amplified IT, for an undisclosed amount to help customers maximize their return on investments in education technology.

Notably, Amplified IT is a leading K12 Services Partner of Alphabet’s GOOGL Google. The company has also received the Google Cloud Global Partner Award for Customer Success for Education. The integration of Amplified IT’s expertise in educator support and technical skills with CDW’s scale and significant market position in education will likely help schools leverage technologies to achieve even more efficient educational outcomes.

The company’s buyout of cloud-native services, software development solutions provider, IGNW, last year, strengthened its capabilities to support customers’ digital transformations.

The acquisition of Aptris in 2019 enhanced the company’s IT Service Management solution capabilities, including consulting, advisory and development services. In the same year, the buyout of Scalar Decisions broadened CDW Canada’s solutions portfolio, fortified its technical skillset and extended the geographic reach.

The company’s purchase of KelwayTopCo (later rebranded it to CDW UK) in 2015 improved its ability to provide IT solutions for the U.S.-based customers with multi-national locations. The company’s footprint in the U.K. also grew with this transaction.

Zacks Rank & Stocks to Consider

CDW currently carries a Zacks Rank #3 (Hold), at present.

Better-ranked stocks in the broader technology sector include Microsoft MSFT, STMicroelectronics N.V.  STM, and Palo Alto Networks PANW, all carrying a Zacks Rank of 2 (Buy), at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

The long-term earnings growth rate for Microsoft, STMicroelectronics and Palo Alto Networks is currently pegged at 11.1%, 5%, and 25.7%, respectively.

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