CDW's Q1 2026 revenue growth improves but margin concerns keep it a hold.

CDW Corporation showed improved revenue growth in Q1 2026, driven mainly by hardware demand from AI inferencing in Financial Services. However, netted-down revenue remained flat and gross margin declined by 60 basis points, raising concerns about the quality of growth and margin trends. The corporate segment showed some recovery, but growth sustainability is uncertain due to pull-forward sales and a weaker higher-margin mix. Despite a historically low valuation, a re-rating depends on revenue recovery and clear profit leverage from its growth initiatives, leading analysts to maintain a hold rating.