Is CDW Corp. overvalued or undervalued?

As of 7 May 2025, the valuation grade for CDW Corp. has moved from expensive to fair, indicating a more favorable assessment of its stock. The company appears to be fairly valued based on its current metrics, with a P/E ratio of 21, an EV to EBITDA of 14.86, and a Price to Book Value of 10.10. In comparison to peers, Block, Inc. has a lower P/E of 12.44, while Cognizant Technology Solutions Corp. shows a P/E of 13.98, suggesting that CDW Corp. is positioned competitively within its industry.
Despite the fair valuation, CDW Corp. has underperformed relative to the S&P 500, with a 1-year return of -26.51% compared to the index's 17.14%. This trend continues over shorter time frames, with a year-to-date return of -6.42% against the S&P 500's 12.22%. Overall, while CDW Corp. is fairly valued, its recent stock performance raises concerns about its growth potential relative to broader market trends.