Group 1: Stock Market Movements - Logitech (LOGI), NetApp (NTAP), and CDW (CDW) saw declines of 6%, 4%, and 2% respectively after Morgan Stanley downgraded all three, citing a "perfect storm" for IT hardware due to the slowest corporate spending in 15 years outside of COVID-19 [4] - The downgrade was influenced by a 4Q CIO survey indicating softer demand, with resellers expecting 30%-60% of customers to cut budgets for PCs, servers, and storage amid rising component prices [4][5] - The hardware down-cycle is expected to last three to five quarters, with CDW downgraded to Equal-Weight (PT $141), Logitech to Underweight (PT $89), and NetApp to Underweight (PT $89) [5] Group 2: NYSE Developments - The New York Stock Exchange (NYSE) is developing a platform for 24/7 trading of tokenized U.S.-listed equities and ETFs using blockchain technology [5][6] - This platform aims to enable instant settlement, dollar-sized orders, and stablecoin-based funding, although the launch date has not been disclosed [6] - The initiative is part of Intercontinental Exchange's (ICE) broader digital strategy, which includes enhancing clearing infrastructure for 24/7 trading and supporting tokenized deposits [7][8] Group 3: Tesla and EV Market - Tesla (TSLA) is expected to benefit from Canada's decision to reduce tariffs on Chinese-made electric vehicles (EVs) from 100% to 6.1%, allowing 49,000 EVs to be imported annually [9][10] - The EV quota may increase to 70,000 within five years, with half reserved for vehicles priced under C$35,000 ($25,192), which does not include Tesla's models [11] - Tesla's largest plant in Shanghai is already equipped to produce a Canada-specific version of its Model Y, which was previously shipped to Canada before the tariff imposition [10]

Market Overview - The stock market in 2025 was solid but volatile, influenced by AI enthusiasm, economic uncertainty, and monetary policy concerns [1] - The summer rally was driven by AI-related spending and economic resiliency, while the fourth quarter experienced volatility due to valuation pressures and macro uncertainty [1] - The S&P 500 Index rose by 2.66% in Q4 2025, with large-cap technology and communication services sectors leading the market [1] Fenimore Asset Management Performance - Fenimore Small Cap Strategy returned -4.12% in Q4 2025, underperforming the Russell 2000 Index, which returned 2.19% [1] - Fenimore Dividend Focus Strategy declined -4.41% in Q4 compared to the Russell Midcap Index's 0.16% return [1] - Fenimore Value Strategy declined -1.17% in Q4, also underperforming against the Russell Midcap Index's 0.16% return [1] - The underperformance in these strategies was attributed to underweight exposure to low-quality stocks and investments in the financial and industrial sectors [1] CDW Corporation Analysis - CDW Corporation (NASDAQ:CDW) was highlighted as a detractor to Fenimore Dividend Focus Strategy's performance [2] - As of January 15, 2026, CDW's stock closed at $132.29 per share, with a one-month return of -5.94% and a 52-week loss of 29.91% [2] - CDW Corporation has a market capitalization of $17.338 billion [2] - The IT industry faced challenges due to the pull forward of spending during COVID, although CDW experienced solid growth in most business lines except for education [3] - Overall earnings growth for CDW exhibited only modest improvement despite some momentum from the Windows 11 refresh [3] Future Outlook - The firm anticipates mixed market conditions in 2026, with many AI-related stocks appearing expensive while high-quality companies are trading at multi-year lows, presenting potential investment opportunities [1]

Core Insights - Oakmark Fund's fourth-quarter 2025 investor letter indicates a focus on capital appreciation through investments in large-cap US companies, with the fund outperforming the S&P 500 Index by returning 4.78% compared to the index's 2.66% [1] Company Overview - CDW Corporation (NASDAQ:CDW) is identified as a leading information technology solutions provider, with a market capitalization of $17.641 billion [2] - The stock closed at $134.60 per share on January 13, 2026, with a one-month return of -6.33% and a 52-week gain of 28.20% [2] Performance and Strategy - CDW Corporation's consolidated net sales for Q3 2025 were reported at $5.7 billion, reflecting a 4% increase from Q3 2024 [4] - The company has transitioned from a technology hardware reseller to a comprehensive IT solutions provider, focusing on software and services, which has positively impacted its margins [3] - The strong corporate culture at CDW, exemplified by its skilled account managers and technology consultants, has been crucial in attracting and retaining customers [3] Market Position - Despite CDW's significant role in the IT ecosystem, the challenging environment for IT service and hardware resellers has negatively affected its share price, presenting a buying opportunity at a compelling valuation [3] - CDW Corporation is not among the 30 most popular stocks among hedge funds, although the number of hedge fund portfolios holding the stock increased from 44 to 48 in the last quarter [4]

Group 1 - Leading Wall Street firms have released their top stock picks for 2026, focusing on companies with strong upside potential and solid dividends [1][3] - Raymond James has identified four quality stocks for growth and income investors, emphasizing the importance of total return strategies [5] - The Raymond James Best Picks List has historically outperformed the Russell 2000 in 20 of its 30 years, indicating a strong track record for selected stocks [7] Group 2 - CDW Corp. is highlighted as a key stock, offering a dependable 1.89% dividend and providing IT solutions across various sectors in North America [6]

Core Insights - CDW Corporation, based in Vernon Hills, Illinois, is set to announce its fiscal Q4 earnings for 2025, with a current market cap of $17.3 billion [1] Financial Performance - Analysts anticipate a profit of $2.30 per share for the upcoming quarter, reflecting a 4.2% decrease from $2.40 per share in the same quarter last year [2] - For the current fiscal year ending in December, CDW is expected to report a profit of $9.36 per share, which is a 1.3% increase from $9.24 per share in fiscal 2024, with further growth projected to $10.03 per share in fiscal 2026, representing a 7.2% year-over-year increase [3] Stock Performance - CDW shares have declined by 26.6% over the past 52 weeks, significantly underperforming the S&P 500 Index's 17.5% return and the State Street Technology Select Sector SPDR ETF's 24.8% increase during the same period [4] - On November 4, despite reporting better-than-expected Q3 results with an adjusted EPS of $2.71 and revenue of $5.7 billion, CDW's shares fell by 8.5%, likely due to a 12.9% rise in selling and administrative expenses and decreased demand in data storage and server sectors [5] Analyst Ratings - Wall Street analysts maintain a "Moderate Buy" rating for CDW, with six out of twelve analysts recommending "Strong Buy," one suggesting "Moderate Buy," and five advising "Hold." The average price target for CDW is $180.60, indicating a potential upside of 35.6% from current levels [6]

Group 1 - The stock selection process showed positive momentum in December, with an average gain of 0.83% for the selected 15 stocks [1] - The SPDR® S&P 500® ETF was mentioned as a benchmark for performance comparison [1] Group 2 - The analyst holds long positions in various companies, including ZTS, MSCI, DPZ, and others, through stock ownership, options, or derivatives [2] - The article reflects the analyst's personal opinions and is not influenced by compensation from any company mentioned [2]

Core View - CDW Corporation is recognized for its consistent dividend payments and strong performance in the IT sector, despite a mixed spending environment [1][3]. Financial Performance - In the third quarter, CDW generated $5.7 billion in net sales, reflecting a 4% increase year-over-year, while gross profit rose by 5% to $1.3 billion [3]. - The company expects gross profit in the second half of the year to be slightly higher than in the first half, although the distribution will be less balanced than the historical pattern [5]. Market Segments - CDW's strengths are evident in government and education sectors, with small business revenue and gross profit showing double-digit growth, driven by increased demand for AI workstations [4]. - The corporate segment also performed well, with revenue growth at a mid-single-digit pace and gross profit growth in the low single digits, primarily due to security and cloud projects [4]. Future Outlook - Management has reaffirmed its 2025 outlook, anticipating growth in the US IT market in the low single digits and projecting to outperform by 200 to 300 basis points [5]. - Gross margins for 2025 are expected to remain in line with those of 2024 [5].

Core Viewpoint - Nasdaq announced changes to the Nasdaq-100 index, with six companies being added and six companies being removed, effective December 22 [1] Group 1: Companies Added - The following six companies will be added to the Nasdaq-100 index: - Enliven Therapeutics - Ferrovia Group - Insmed - Monolithic Power Systems - Seagate Technology Holdings - Western Digital [1] Group 2: Companies Removed - The following six companies will be removed from the Nasdaq-100 index: - Biogen - CDW - GlobalFoundries - Lululemon Athletica - ON Semiconductor - The Trade Desk [1]

Core Viewpoint - CDW Corporation, a leading IT solutions provider with a market cap of $19 billion, is experiencing significant stock price declines despite reporting better-than-expected earnings and revenue for Q3 2025 [1][5]. Company Overview - CDW Corporation is based in Vernon Hills, Illinois, and serves corporate, small business, and public sector clients across the U.S., U.K., and Canada [1]. - The company offers a wide range of IT solutions, including hardware, software, hybrid infrastructure, digital experience, and security solutions [1]. Stock Performance - CDW shares have fallen 34.4% from their 52-week high of $222.92 and have declined 12.9% over the past three months, underperforming the Dow Jones Industrials Average, which rose by 5.2% in the same period [3]. - Year-to-date, CDW stock is down nearly 16%, lagging behind the Dow's 12.5% gain, and has dipped 18.8% over the past 52 weeks compared to the Dow's 7.2% return [4]. - The stock has been trading mostly below its 50-day and 200-day moving averages since last year [4]. Financial Performance - In Q3 2025, CDW reported an adjusted EPS of $2.71 and revenue of $5.74 billion, which were better than expected [5]. - However, the stock tumbled 8.5% following the earnings report due to concerns over a 12.9% increase in selling and administrative expenses and a decline in demand in key areas, including an 8.5% revenue drop in the Education segment [5]. Competitive Landscape - In comparison, IBM has outperformed CDW, with its shares climbing 31.4% over the past 52 weeks and 42.3% year-to-date [6]. - Despite CDW's weak performance, analysts maintain a moderately optimistic outlook, with a consensus rating of "Moderate Buy" and a mean price target of $182, representing a 24.9% premium to current levels [6].

Core Viewpoint - CDW Corporation, valued at $18.3 billion, provides a diverse range of IT solutions across North America and the UK, serving various sectors including corporate, small business, government, education, and healthcare [1] Performance Summary - Over the past 52 weeks, CDW stock has decreased by 21.5%, underperforming the S&P 500 Index, which has risen by 12.3% [2] - Year-to-date, CDW shares have dropped 19.7%, while the S&P 500 has gained 12.5% [2] - CDW has also underperformed the Technology Select Sector SPDR Fund, which increased by 21.6% over the past year [3] Financial Results - In Q3 2025, CDW reported adjusted EPS of $2.71 and revenue of $5.74 billion, exceeding expectations; however, shares fell by 8.5% due to rising selling and administrative expenses and declining demand in key segments [4] - The Education segment experienced an 8.5% revenue decline, alongside softness in data storage and servers [4] Future Outlook - For the fiscal year ending December 2025, analysts project a 1.4% year-over-year increase in EPS to $9.37, with a positive earnings surprise history [5] - The consensus rating among 12 analysts is a "Moderate Buy," with five "Strong Buy" ratings, two "Moderate Buys," and five "Holds" [5] Analyst Ratings - BofA analyst Ruplu Bhattacharya has reduced CDW's price target to $170 while maintaining a "Neutral" rating [6] - The mean price target of $182 indicates a 30.2% premium to current price levels, while the highest target of $225 suggests a potential upside of 60.9% [6]