Here’s What Hit CDW Corporation (CDW) in Q4

Fenimore Asset Management, an investment management company, released its Q4 2025 investor letter. A copy of the same can be downloaded here. The stock market was solid in 2025 but volatile. While investors balanced AI enthusiasm, economic uncertainty, and monetary policy concerns.  The summer rally was driven by AI-related spending and economic resiliency, whereas the fourth quarter saw a more volatile market due to valuation pressures and macro uncertainty. Stocks from the large-cap technology and communication services sectors led the market in the quarter, with the S&P 500 Index rising 2.66%. The firm believes that the trend of AI stocks outpacing high-quality stocks is unsustainable. In Q4 2025, Fenimore Small Cap Strategy returned -4.12%, trailing its benchmark, the Russell 2000 Index’s 2.19% return. The underweight exposure to low-quality stocks drove the underperformance in the quarter. Fenimore Dividend Focus Strategy declined -4.41% in Q4 compared to the Russell Midcap Index’s 0.16% return. Furthermore, Fenimore Value Strategy declined -1.17% in Q4 compared to the Russell Midcap Index’s 0.16% return. Investments in the financial and industrial sectors led to the relative underperformance of the Strategy in the quarter. The firm expects mixed market conditions in 2026 as many AI-related stocks look expensive while high-quality companies are trading at multi-year lows, creating opportunities. In addition, please check the fund’s top five holdings to know its best picks in 2025.

In its fourth-quarter 2025 investor letter, Fenimore Asset Management highlighted stocks such as CDW Corporation (NASDAQ:CDW). CDW Corporation (NASDAQ:CDW) was one of the detractors to Fenimore Dividend Focus Strategy’s performance in the quarter. Headquartered in Vernon Hills, Illinois, CDW Corporation (NASDAQ:CDW) is a leading information technology solutions provider. On January 15, 2026, CDW Corporation (NASDAQ:CDW) stock closed at $132.29 per share. One-month return of CDW Corporation (NASDAQ:CDW) was -5.94%, and its shares lost 29.91% of their value over the last 52 weeks. CDW Corporation (NASDAQ:CDW) has a market capitalization of $17.338 billion.

Fenimore Asset Management stated the following regarding CDW Corporation (NASDAQ:CDW) in its fourth quarter 2025 investor letter:

“CDW Corporation (NASDAQ:CDW) was the second-worst performer.  The IT industry continued to suffer from the pull forward of spending during COVID; however, we saw some momentum with the Windows 11 refresh and all of CDW’s business lines had solid growth except for education. Despite this, overall earnings growth only exhibited modest improvement.”

Is CDW Corporation (CDW) Mid-Cap IT Stock Outperforming The Market In 2025?

CDW Corporation (NASDAQ:CDW) is not on our list of 30 Most Popular Stocks Among Hedge Funds. According to our database, 48 hedge fund portfolios held CDW Corporation (NASDAQ:CDW) at the end of the third quarter, up from 44 in the previous quarter. In Q3 2025, CDW Corporation reported consolidates net sales (NASDAQ:CDW) of $5.7 billion, up 4% from Q3 2024. While we acknowledge the risk and potential of CDW Corporation (NASDAQ:CDW) as an investment, our conviction lies in the belief that some AI stocks hold greater promise for delivering higher returns and doing so within a shorter time frame. If you are looking for an AI stock that is more promising than CDW Corporation (NASDAQ:CDW) and that has 10,000% upside potential, check out our report about this cheapest AI stock.

In another article, we covered CDW Corporation (NASDAQ:CDW) and shared the list of Oakmark Fund’s views on the company. In addition, please check out our hedge fund investor letters Q4 2025 page for more investor letters from hedge funds and other leading investors.

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Disclosure: None. This article is originally published at Insider Monkey.