BATH & BODY WORKS INC (BBWI) Stock Fundamental Analysis
NYSE:BBWI - New York Stock Exchange, Inc. - US0708301041 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to BBWI. BBWI was compared to 120 industry peers in the Specialty Retail industry. While BBWI belongs to the best of the industry regarding profitability, there are concerns on its financial health. BBWI has a decent growth rate and is not valued too expensively.
1. Profitability
1.1 Basic Checks
In the past year BBWI was profitable.
In the past year BBWI had a positive cash flow from operations.
BBWI had positive earnings in 4 of the past 5 years.
Each year in the past 5 years BBWI had a positive operating cash flow.
1.2 Ratios
BBWI has a better Return On Assets (18.54%) than 96.58% of its industry peers.
BBWI has a better Return On Invested Capital (30.50%) than 96.58% of its industry peers.
BBWI had an Average Return On Invested Capital over the past 3 years of 28.79%. This is significantly above the industry average of 12.30%.
The 3 year average ROIC (28.79%) for BBWI is below the current ROIC(30.50%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.54% | ||
| ROE | N/A | ||
| ROIC | 30.5% |
ROA(3y)17.58%
ROA(5y)11.29%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)28.79%
ROIC(5y)22.47%
1.3 Margins
The Profit Margin of BBWI (12.43%) is better than 94.87% of its industry peers.
In the last couple of years the Profit Margin of BBWI has grown nicely.
With an excellent Operating Margin value of 17.28%, BBWI belongs to the best of the industry, outperforming 94.02% of the companies in the same industry.
BBWI's Operating Margin has improved in the last couple of years.
The Gross Margin of BBWI (43.99%) is better than 67.52% of its industry peers.
BBWI's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.28% | ||
| PM (TTM) | 12.43% | ||
| GM | 43.99% |
OM growth 3Y-12.02%
OM growth 5Y9.76%
PM growth 3Y-3.42%
PM growth 5Y19.42%
GM growth 3Y-3.26%
GM growth 5Y2.89%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is well above the Cost of Capital (WACC), so BBWI is creating value.
The number of shares outstanding for BBWI has been reduced compared to 1 year ago.
BBWI has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, BBWI has an improved debt to assets ratio.
2.2 Solvency
BBWI has a debt to FCF ratio of 6.53. This is a slightly negative value and a sign of low solvency as BBWI would need 6.53 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 6.53, BBWI is in line with its industry, outperforming 58.12% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 6.53 | ||
| Altman-Z | N/A |
ROIC/WACC2.91
WACC10.5%
2.3 Liquidity
BBWI has a Current Ratio of 1.09. This is a normal value and indicates that BBWI is financially healthy and should not expect problems in meeting its short term obligations.
BBWI has a Current ratio of 1.09. This is in the lower half of the industry: BBWI underperforms 72.65% of its industry peers.
A Quick Ratio of 0.34 indicates that BBWI may have some problems paying its short term obligations.
BBWI has a Quick ratio of 0.34. This is in the lower half of the industry: BBWI underperforms 66.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.09 | ||
| Quick Ratio | 0.34 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 7.49% over the past year.
The Earnings Per Share has been growing slightly by 2.93% on average over the past years.
The Revenue has been growing slightly by 0.36% in the past year.
The Revenue for BBWI have been decreasing by -10.91% on average. This is quite bad
EPS 1Y (TTM)7.49%
EPS 3Y-1.48%
EPS 5Y2.93%
EPS Q2Q%2.08%
Revenue 1Y (TTM)0.36%
Revenue growth 3Y4.91%
Revenue growth 5Y-10.91%
Sales Q2Q%3.07%
3.2 Future
Based on estimates for the next years, BBWI will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.16% on average per year.
The Revenue is expected to grow by 2.37% on average over the next years.
EPS Next Y1.84%
EPS Next 2Y6%
EPS Next 3Y7.17%
EPS Next 5Y9.16%
Revenue Next Year-0.75%
Revenue Next 2Y1.01%
Revenue Next 3Y1.82%
Revenue Next 5Y2.37%
3.3 Evolution
When comparing the EPS growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 11.69, which indicates a very decent valuation of BBWI.
81.20% of the companies in the same industry are more expensive than BBWI, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of BBWI to the average of the S&P500 Index (29.63), we can say BBWI is valued rather cheaply.
The Price/Forward Earnings ratio is 10.50, which indicates a very decent valuation of BBWI.
Based on the Price/Forward Earnings ratio, BBWI is valued a bit cheaper than the industry average as 77.78% of the companies are valued more expensively.
When comparing the Price/Forward Earnings ratio of BBWI to the average of the S&P500 Index (22.68), we can say BBWI is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.69 | ||
| Fwd PE | 10.5 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of BBWI indicates a somewhat cheap valuation: BBWI is cheaper than 68.38% of the companies listed in the same industry.
BBWI's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. BBWI is cheaper than 77.78% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 13 | ||
| EV/EBITDA | 8.14 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
BBWI has an outstanding profitability rating, which may justify a higher PE ratio.
PEG (NY)6.34
PEG (5Y)3.99
EPS Next 2Y6%
EPS Next 3Y7.17%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.20%, BBWI has a reasonable but not impressive dividend return.
Compared to an average industry Dividend Yield of 4.01, BBWI pays a better dividend. On top of this BBWI pays more dividend than 84.62% of the companies listed in the same industry.
BBWI's Dividend Yield is comparable with the S&P500 average which is at 2.29.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.2% |
5.2 History
The dividend of BBWI decreases each year by -19.69%.
BBWI has been paying a dividend for at least 10 years, so it has a reliable track record.
BBWI has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-19.69%
Div Incr Years0
Div Non Decr Years4
5.3 Sustainability
19.37% of the earnings are spent on dividend by BBWI. This is a low number and sustainable payout ratio.
DP19.37%
EPS Next 2Y6%
EPS Next 3Y7.17%
38.59
-1.75 (-4.34%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Discretionary Distribution & Retail
GICS IndustrySpecialty Retail
Earnings (Last)
Earnings (Next)
Inst Owners99.26%
Inst Owner Change-3.69%
Ins Owners0.25%
Ins Owner Change0.06%
Market Cap8.36B
Analysts76.8
Price Target46.63 (20.83%)
Short Float %2.59%
Short Ratio1.65
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.2% |
Yearly Dividend0.8
Dividend Growth(5Y)-19.69%
DP19.37%
Div Incr Years0
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)2.03%
Min EPS beat(2)1.56%
Max EPS beat(2)2.51%
EPS beat(4)4
Avg EPS beat(4)5.81%
Min EPS beat(4)1.56%
Max EPS beat(4)11.29%
EPS beat(8)8
Avg EPS beat(8)14.21%
EPS beat(12)11
Avg EPS beat(12)20.43%
EPS beat(16)15
Avg EPS beat(16)22.52%
Revenue beat(2)0
Avg Revenue beat(2)-1.52%
Min Revenue beat(2)-3.05%
Max Revenue beat(2)0%
Revenue beat(4)1
Avg Revenue beat(4)-0.78%
Min Revenue beat(4)-3.05%
Max Revenue beat(4)0.59%
Revenue beat(8)2
Avg Revenue beat(8)-1.01%
Revenue beat(12)3
Avg Revenue beat(12)-0.87%
Revenue beat(16)5
Avg Revenue beat(16)-6.54%
PT rev (1m)2.2%
PT rev (3m)8.65%
EPS NQ rev (1m)0.28%
EPS NQ rev (3m)1.06%
EPS NY rev (1m)0.01%
EPS NY rev (3m)2.56%
Revenue NQ rev (1m)0.07%
Revenue NQ rev (3m)-3.18%
Revenue NY rev (1m)-0.05%
Revenue NY rev (3m)0.74%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 11.69 | ||
| Fwd PE | 10.5 | ||
| P/S | 1.12 | ||
| P/FCF | 13 | ||
| P/OCF | 9.75 | ||
| P/B | N/A | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.14 |
EPS(TTM)3.3
EY8.55%
EPS(NY)3.67
Fwd EY9.52%
FCF(TTM)2.97
FCFY7.69%
OCF(TTM)3.96
OCFY10.25%
SpS34.32
BVpS-8.07
TBVpS-11.73
PEG (NY)6.34
PEG (5Y)3.99
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 18.54% | ||
| ROE | N/A | ||
| ROCE | 37.67% | ||
| ROIC | 30.5% | ||
| ROICexc | 32.31% | ||
| ROICexgc | 42.88% | ||
| OM | 17.28% | ||
| PM (TTM) | 12.43% | ||
| GM | 43.99% | ||
| FCFM | 8.65% |
ROA(3y)17.58%
ROA(5y)11.29%
ROE(3y)N/A
ROE(5y)N/A
ROIC(3y)28.79%
ROIC(5y)22.47%
ROICexc(3y)43.78%
ROICexc(5y)34.43%
ROICexgc(3y)60.49%
ROICexgc(5y)46.48%
ROCE(3y)35.55%
ROCE(5y)27.75%
ROICexcg growth 3Y9.2%
ROICexcg growth 5Y2.6%
ROICexc growth 3Y7.21%
ROICexc growth 5Y6.25%
OM growth 3Y-12.02%
OM growth 5Y9.76%
PM growth 3Y-3.42%
PM growth 5Y19.42%
GM growth 3Y-3.26%
GM growth 5Y2.89%
F-Score7
Asset Turnover1.49
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | N/A | ||
| Debt/FCF | 6.53 | ||
| Debt/EBITDA | 2.48 | ||
| Cap/Depr | 76.16% | ||
| Cap/Sales | 2.88% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 54.76% | ||
| Profit Quality | 69.59% | ||
| Current Ratio | 1.09 | ||
| Quick Ratio | 0.34 | ||
| Altman-Z | N/A |
F-Score7
WACC10.5%
ROIC/WACC2.91
Cap/Depr(3y)111.19%
Cap/Depr(5y)91.05%
Cap/Sales(3y)3.93%
Cap/Sales(5y)4.76%
Profit Quality(3y)89.46%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)7.49%
EPS 3Y-1.48%
EPS 5Y2.93%
EPS Q2Q%2.08%
EPS Next Y1.84%
EPS Next 2Y6%
EPS Next 3Y7.17%
EPS Next 5Y9.16%
Revenue 1Y (TTM)0.36%
Revenue growth 3Y4.91%
Revenue growth 5Y-10.91%
Sales Q2Q%3.07%
Revenue Next Year-0.75%
Revenue Next 2Y1.01%
Revenue Next 3Y1.82%
Revenue Next 5Y2.37%
EBIT growth 1Y3.38%
EBIT growth 3Y-7.7%
EBIT growth 5Y-2.21%
EBIT Next Year24.15%
EBIT Next 3Y10.24%
EBIT Next 5Y7.98%
FCF growth 1Y-22.62%
FCF growth 3Y-28.72%
FCF growth 5Y-2.59%
OCF growth 1Y-22.93%
OCF growth 3Y-22.37%
OCF growth 5Y-7.08%