CDW vs Best Buy Which Offers More Value?

CDW Corporation and Best Buy Co., Inc. are both prominent players in the consumer electronics and technology retail sector. CDW is a leading provider of technology solutions and services to business, government, education, and healthcare organizations. Best Buy, on the other hand, is a multinational retailer of consumer electronics, appliances, and entertainment products. Both companies have a strong track record of success and growth in their respective markets, but their stocks may appeal to different types of investors based on their financial performance, market positioning, and growth potential.

CDW or Best Buy?

When comparing CDW and Best Buy, 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 CDW and Best Buy.

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. CDW has a dividend yield of 1.39%, while Best Buy has a dividend yield of 3.24%. Beyond the yield itself, considering the growth and sustainability of these dividends is also crucial. CDW reports a 5-year dividend growth of 20.91% year and a payout ratio of 29.93%. On the other hand, Best Buy reports a 5-year dividend growth of 15.38% year and a payout ratio of 63.39%.

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 CDW P/E ratio at 21.44 and Best Buy's P/E ratio at 14.79. Another crucial valuation metric is the Price-to-Book (P/B) Ratio, which compares stock price with book value per share. CDW P/B ratio is 10.13 while Best Buy's P/B ratio is 5.17.

Growth Investors:

Growth investors prioritize metrics indicative of a company's expansion potential. Focusing on top-line growth, CDW has seen a 5-year revenue growth of 0.48%, while Best Buy's is 0.47%. Return on Equity (ROE) measures how effectively a company uses equity investment to generate earnings, with CDW's ROE at 50.99% and Best Buy's ROE at 39.46%.

Retail Investors:

Retail investors often consider stock affordability and company familiarity. For example, day low prices are $175.99 for CDW and $86.84 for Best Buy. Over the past year, CDW's prices ranged from $172.95 to $263.37, with a yearly change of 52.28%. Best Buy's prices fluctuated between $69.29 and $103.71, with a yearly change of 49.68%. Brand recognition also plays a role, as familiarity with a company can influence investment decisions.