Morgan Stanley Upgrades CDW to Overweight, Sets $170 Price Target, Citing Buying Opportunity in Enterprise Server Space

Morgan Stanley upgraded hardware and software distributor CDW to overweight from equal weight and raised its price target to $170 from $142, implying roughly a 38% upside from the previous close. Analyst Erik Woodring said CDW’s valuation remains compelling relative to peers, noting a forward earnings multiple of about 11x—well below the S&P 500’s 20.9x and the Nasdaq‑100’s 25x. The stock has lagged this year, falling nearly 10%, as investors worried about inflation, AI adoption and weaker software revenue. However, CDW has seen stronger‑than‑expected demand for servers, storage and networking, contributing over 20% of revenue, and the company expects double‑digit EPS growth in the second half. A new $1 billion share‑buyback plan announced in late May should provide additional support. The upgrade aligns with Street consensus, where seven of 12 analysts rate CDW a buy or strong buy.

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