Balancing Dividends and Fundamentals: The Case of NYSE:WST.

Last update: Nov 4, 2024

Our stock screener has singled out WEST PHARMACEUTICAL SERVICES (NYSE:WST) as a promising choice for dividend investors. NYSE:WST not only scores well in profitability, solvency, and liquidity but also offers a decent dividend. We'll explore this further.

A Closer Look at Dividend for NYSE:WST

ChartMill employs its own Dividend Rating system for all stocks. This score, on a scale of 0 to 10, is determined by evaluating different dividend factors, such as yield, historical performance, dividend growth, and sustainability. NYSE:WST has been assigned a 7 for dividend:

WST's Dividend Yield is rather good when compared to the industry average which is at 0.67. WST pays more dividend than 85.45% of the companies in the same industry.
The dividend of WST is nicely growing with an annual growth rate of 6.31%!
WST has been paying a dividend for at least 10 years, so it has a reliable track record.
WST has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
11.73% of the earnings are spent on dividend by WST. This is a low number and sustainable payout ratio.
The dividend of WST is growing, but earnings are growing more, so the dividend growth is sustainable.

How We Gauge Health for NYSE:WST

A critical element of ChartMill's stock evaluation is the Health Rating, which spans from 0 to 10. This rating considers multiple health factors, including liquidity and solvency, both in absolute terms and relative to industry peers. NYSE:WST has received a 9 out of 10:

An Altman-Z score of 18.04 indicates that WST is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 18.04, WST belongs to the top of the industry, outperforming 100.00% of the companies in the same industry.
The Debt to FCF ratio of WST is 0.64, which is an excellent value as it means it would take WST, only 0.64 years of fcf income to pay off all of its debts.
With an excellent Debt to FCF ratio value of 0.64, WST belongs to the best of the industry, outperforming 90.91% of the companies in the same industry.
WST has a Debt/Equity ratio of 0.07. This is a healthy value indicating a solid balance between debt and equity.
With a decent Debt to Equity ratio value of 0.07, WST is doing good in the industry, outperforming 63.64% of the companies in the same industry.
WST has a Current Ratio of 3.00. This indicates that WST is financially healthy and has no problem in meeting its short term obligations.
WST has a Quick Ratio of 2.23. This indicates that WST is financially healthy and has no problem in meeting its short term obligations.

Profitability Insights: NYSE:WST

ChartMill assigns a proprietary Profitability Rating to each stock. The score is computed by evaluating various profitability ratios and margins and ranges from 0 to 10. NYSE:WST was assigned a score of 9 for profitability:

WST has a better Return On Assets (13.59%) than 96.36% of its industry peers.
WST has a better Return On Equity (18.15%) than 90.91% of its industry peers.
The Return On Invested Capital of WST (15.28%) is better than 94.55% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for WST is significantly above the industry average of 11.02%.
The 3 year average ROIC (20.47%) for WST is well above the current ROIC(15.28%). The reason for the recent decline needs to be investigated.
With an excellent Profit Margin value of 17.37%, WST belongs to the best of the industry, outperforming 90.91% of the companies in the same industry.
WST's Profit Margin has improved in the last couple of years.
With an excellent Operating Margin value of 20.37%, WST belongs to the best of the industry, outperforming 87.27% of the companies in the same industry.
WST's Operating Margin has improved in the last couple of years.
WST's Gross Margin has improved in the last couple of years.

More Best Dividend stocks can be found in our Best Dividend screener.

For an up to date full fundamental analysis you can check the fundamental report of WST

Keep in mind

This article should in no way be interpreted as advice. The article is based on the observed metrics at the time of writing, but you should always make your own analysis and trade or invest at your own responsibility.