CDWonsemi

CDW vs onsemi

CDW and onsemi: this page compares business models, financial performance, and market context to help you understand each company. The comparison is designed to be neutral and accessible, outlining ho...

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Work From Anywhere Kit

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Investment Analysis

CDW

CDW

CDW

Pros

  • CDW benefits from a diversified IT solutions portfolio across corporate, small business, and public sectors, reducing dependence on any single customer segment.
  • The company has delivered consistent dividend growth, increasing its annual payout from £0.27 in 2015 to £2.52, reflecting strong cash flow and shareholder returns.
  • Recent quarterly results showed revenue growth exceeding expectations, with corporate segment sales up 4.4% year-on-year and overall revenue growth of over 10%.

Considerations

  • CDW operates with a relatively high debt-to-equity ratio of 2.21, which may constrain financial flexibility in a rising interest rate environment.
  • The stock has experienced notable volatility, with its 52-week range spanning from £137 to £223, reflecting sensitivity to macroeconomic and tech sector sentiment.
  • Despite revenue growth, net margins remain modest at under 5%, limiting earnings leverage compared to some peers in the technology services space.
onsemi

Pros

  • onsemi holds a leading position in power management and sensing semiconductors, critical for automotive, industrial, and renewable energy applications.
  • The company maintains solid profitability, with trailing twelve-month net income of £1.57 billion on £7.08 billion sales, reflecting efficient operations.
  • onsemi’s balance sheet shows no dividend obligation, allowing full reinvestment of cash flow into high-growth areas like silicon carbide and electric vehicles.

Considerations

  • onsemi’s business is exposed to cyclical semiconductor demand, with revenue and margins vulnerable to downturns in autos, industrial, or consumer electronics.
  • The stock’s 60-month beta of 1.56 indicates higher volatility versus the broader market, suggesting amplified swings during periods of sector turbulence.
  • Although profitable, onsemi’s price-to-earnings ratio of 18.1 may limit upside if earnings growth slows or industry valuations contract.

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