Canadian Tire vs CDW Which Is More Favorable?

Canadian Tire Corporation Limited (CTC) and CDW Corporation (CDW) are both prominent players in the retail and technology sectors, respectively. While Canadian Tire is a well-established Canadian retail company with a diversified portfolio of products and services, CDW is a leading provider of technology solutions for businesses in North America. Both stocks have shown solid performance in recent years, but their growth prospects and market outlooks differ significantly. It is important for investors to carefully evaluate the financial health and growth potential of each company before making investment decisions.

Canadian Tire or CDW?

When comparing Canadian Tire and CDW, different investors may prioritize various metrics based on their investment strategies and goals. So, ask yourself what type of investor you are. This will guide you in determining which metrics are most important for your investment decision between Canadian Tire and CDW.

Dividend Investors:

Dividend investors look for stable and growing income streams, using dividend metrics to assess potential investments. A company's dividend yield essentially measures the size of its dividend relative to the total market value of the company. Canadian Tire has a dividend yield of 4.14%, while CDW has a dividend yield of 1.24%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. Canadian Tire reports a 5-year dividend growth of 11.12% year and a payout ratio of 93.42%. On the other hand, CDW reports a 5-year dividend growth of 20.91% year and a payout ratio of 29.93%.

Value Investors:

Value investors focus on financial metrics to determine a stock's intrinsic value compared to its market value. The Price-to-Earnings (P/E) Ratio links stock price to a company's earnings per share, with Canadian Tire P/E ratio at 22.43 and CDW's P/E ratio at 24.04. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. Canadian Tire P/B ratio is 1.51 while CDW's P/B ratio is 11.36.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, Canadian Tire has seen a 5-year revenue growth of 0.37%, while CDW's is 0.48%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with Canadian Tire's ROE at 7.00% and CDW's ROE at 50.99%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $109.70 for Canadian Tire and $197.90 for CDW. Over the past year, Canadian Tire's prices ranged from $91.50 to $120.47, with a yearly change of 31.66%. CDW's prices fluctuated between $187.73 and $263.37, with a yearly change of 40.29%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.