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— Warren Buffett

A five-year holding period is often used to test whether a business has translated operating performance into durable shareholder returns. For CDW Corp (NASD: CDW), that test produced a modestly negative outcome over the period beginning on 10/28/2021 and ending on 10/27/2026. Including dividends reinvested, a $10,000 investment declined to $9,291.01, resulting in a total return of -7.07% and an annualized return of -1.46%.

That result is notable because CDW is widely recognized as a large-scale provider of information technology products and services, with exposure to enterprise, government, education, and healthcare spending. The company operates in a part of the market where recurring technology demand can support resilient revenue, but the stock’s investment outcome over any given five-year period still depends heavily on purchase valuation, earnings growth, and the broader market multiple applied to those earnings.

CDW 5-Year Return Details

CDW 5-Year Return Details
Start date:	10/28/2021	$10,000 10/28/2021   $9,291 10/27/2026
End date:	10/27/2026
Start price/share:	$185.94
End price/share:	$161.41
Starting shares:	53.78
Ending shares:	57.57
Dividends reinvested/share:	$11.86
Total return:	-7.07%
Average annual return:	-1.46%
Starting investment:	$10,000.00
Ending investment:	$9,291.01

The arithmetic is straightforward. The share price fell from $185.94 to $161.41 over the period, and dividend reinvestment increased the share count from 53.78 to 57.57. Even with that added share accumulation, the ending portfolio value remained below the original investment amount. In other words, the dividend stream softened the decline, but it did not fully offset the price contraction.

What Drove the Negative Total Return?

For a stock like CDW, a negative five-year total return can emerge from several forces acting together:

• Valuation at the entry point: A high starting multiple can leave limited room for future appreciation, even if the underlying business remains fundamentally solid.
• Share price compression: The stock ended the period below the original purchase price, which was the primary reason the total return was negative.
• Dividend yield profile: CDW paid dividends consistently, but the yield was not large enough to dominate the overall outcome.
• Business cyclicality in IT spending: Demand for hardware, software, and related services can be resilient over time, but still fluctuate with enterprise budgets, procurement cycles, and macroeconomic conditions.

This is an important distinction in total return analysis. A company can remain operationally relevant and continue paying dividends, while the stock still delivers a lackluster investment result if the purchase price was demanding or if market sentiment later resets.

How Much Did Dividends Matter?

CDW paid a total of $11.86 per share in dividends during the holding period. Because the calculation assumes those dividends were reinvested, the position grew from 53.78 shares to 57.57 shares. That incremental share count is the second component of return beyond the stock’s price movement.

Dividend reinvestment matters most when it compounds over longer periods or when a stock is purchased at more favorable valuations. In this case, reinvestment provided a measurable benefit, but the decline in the share price remained the dominant factor in the final result. The calculation above assumes reinvestment at the closing price on each ex-dividend date. [These numbers were computed with the Dividend Channel DRIP Returns Calculator.]

CDW Dividend Yield and Yield on Cost

Based on the most recent annualized dividend rate of $2.52 per share, CDW has a current yield of approximately 1.56% using the ending share price of $161.41.

Another useful lens is yield on cost, which compares the current annualized dividend to the original purchase price rather than the current market price. Using the initial entry price of $185.94 per share, the $2.52 annualized dividend equates to a yield on cost of about 1.36%.

What This CDW Investment Result Suggests

The main lesson from this five-year CDW investment result is that total return depends on more than business quality alone. Entry valuation, the path of earnings expectations, and the level of dividend income all shape the final outcome. A stable dividend can improve returns at the margin, but when the stock price finishes materially below the purchase price, income alone may not be enough to generate a positive result.

For investors evaluating CDW today, the relevant question is not simply whether the company has performed adequately as an operator, but whether the current valuation, cash-flow profile, and dividend characteristics create a more attractive setup for future total returns than was available in late 2021.

One final investing principle remains relevant here:
“Confronted with a challenge to distill the secret of sound investment into three words, we venture the motto, Margin of Safety.” — Benjamin Graham