UPDATE: CDW Posts Upbeat Q3 Earnings, Raises Dividend

CDW

reported better-than-expected third-quarter earnings. The Vernon Hills, Illinois-based company posted quarterly net income of $55.6 million, or $0.32 per share, versus a year-ago net loss of $2.2 million, or $0.01 per share. Excluding one-time items, the company earned $0.64 per share. Its revenue rose 14% to $3.27 billion in the period. However, analysts were estimating earnings of $0.61 per share on revenue of $3.11 billion. Average daily sales climbed to $51.0 million from $44.8 million. Total corporate segment net sales rose 10.7% to $1.623 billion, while total public segment net sales jumped 18% to $1.469 billion. Net sales for its advanced services business and Canadian operations gained 13.5% to $174.6 million. Gross profit margin narrowed to 15.5% from 16.0%. CDW raised its quarterly cash dividend by 59% and initiated a $500 million share repurchase program. The company also agreed to acquire minority stake in Kelway. "Our third quarter performance highlights the power of our balanced portfolio of channels, broad suite of products and solutions and disciplined approach to investing and controlling costs as we once again grew faster than U.S. IT market estimates and delivered solid profitability," said Thomas E. Richards, chairman and chief executive officer of CDW. CDW shares rose 0.93% to close at $31.33 yesterday.