NORTH WEST CO INC/THE (NWC.CA) Stock Fundamental Analysis
Canada - Toronto Stock Exchange - TSX:NWC - CA6632782083 - Common Stock
50.65 CAD
+0.25 (+0.5%)
Overall NWC gets a fundamental rating of 6 out of 10. We evaluated NWC against 17 industry peers in the Consumer Staples Distribution & Retail industry. NWC gets an excellent profitability rating and is at the same time showing great financial health properties. NWC has a correct valuation and a medium growth rate. Finally NWC also has an excellent dividend rating. These ratings could make NWC a good candidate for dividend investing.
1. Profitability
1.1 Basic Checks
- In the past year NWC was profitable.
- NWC had a positive operating cash flow in the past year.
- In the past 5 years NWC has always been profitable.
- Each year in the past 5 years NWC had a positive operating cash flow.
1.2 Ratios
- NWC has a better Return On Assets (8.95%) than 100.00% of its industry peers.
- With a decent Return On Equity value of 17.99%, NWC is doing good in the industry, outperforming 64.71% of the companies in the same industry.
- NWC has a Return On Invested Capital of 12.16%. This is amongst the best in the industry. NWC outperforms 100.00% of its industry peers.
- The Average Return On Invested Capital over the past 3 years for NWC is above the industry average of 8.51%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 8.95% | ||
| ROE | 17.99% | ||
| ROIC | 12.16% |
ROA(3y)9.13%
ROA(5y)10.37%
ROE(3y)18.7%
ROE(5y)22.41%
ROIC(3y)12.75%
ROIC(5y)14.69%
1.3 Margins
- NWC's Profit Margin of 5.51% is amongst the best of the industry. NWC outperforms 100.00% of its industry peers.
- In the last couple of years the Profit Margin of NWC has grown nicely.
- NWC has a better Operating Margin (8.27%) than 94.12% of its industry peers.
- NWC's Operating Margin has improved in the last couple of years.
- Looking at the Gross Margin, with a value of 34.10%, NWC is in the better half of the industry, outperforming 76.47% of the companies in the same industry.
- In the last couple of years the Gross Margin of NWC has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 8.27% | ||
| PM (TTM) | 5.51% | ||
| GM | 34.1% |
OM growth 3Y-4.74%
OM growth 5Y8.71%
PM growth 3Y-8.18%
PM growth 5Y6.18%
GM growth 3Y0.9%
GM growth 5Y1.22%
2. Health
2.1 Basic Checks
- With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), NWC is creating some value.
- Compared to 1 year ago, NWC has more shares outstanding
- Compared to 5 years ago, NWC has less shares outstanding
- Compared to 1 year ago, NWC has an improved debt to assets ratio.
2.2 Solvency
- An Altman-Z score of 4.63 indicates that NWC is not in any danger for bankruptcy at the moment.
- Looking at the Altman-Z score, with a value of 4.63, NWC belongs to the top of the industry, outperforming 88.24% of the companies in the same industry.
- NWC has a debt to FCF ratio of 4.12. This is a neutral value as NWC would need 4.12 years to pay back of all of its debts.
- Looking at the Debt to FCF ratio, with a value of 4.12, NWC belongs to the top of the industry, outperforming 82.35% of the companies in the same industry.
- NWC has a Debt/Equity ratio of 0.58. This is a neutral value indicating NWC is somewhat dependend on debt financing.
- NWC has a Debt to Equity ratio of 0.58. This is amongst the best in the industry. NWC outperforms 88.24% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.58 | ||
| Debt/FCF | 4.12 | ||
| Altman-Z | 4.63 |
ROIC/WACC1.65
WACC7.37%
2.3 Liquidity
- A Current Ratio of 2.26 indicates that NWC has no problem at all paying its short term obligations.
- NWC has a better Current ratio (2.26) than 88.24% of its industry peers.
- NWC has a Quick Ratio of 2.26. This is a bad value and indicates that NWC is not financially healthy enough and could expect problems in meeting its short term obligations.
- The Quick ratio of NWC (0.82) is better than 70.59% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.26 | ||
| Quick Ratio | 0.82 |
3. Growth
3.1 Past
- NWC shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 12.92%, which is quite good.
- NWC shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 15.41% yearly.
- Looking at the last year, NWC shows a small growth in Revenue. The Revenue has grown by 2.08% in the last year.
- Measured over the past years, NWC shows a small growth in Revenue. The Revenue has been growing by 4.23% on average per year.
EPS 1Y (TTM)12.92%
EPS 3Y-0.66%
EPS 5Y15.41%
EPS Q2Q%4.34%
Revenue 1Y (TTM)2.08%
Revenue growth 3Y4.64%
Revenue growth 5Y4.23%
Sales Q2Q%-0.5%
3.2 Future
- NWC is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 10.12% yearly.
- NWC is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.73% yearly.
EPS Next Y13.86%
EPS Next 2Y14.83%
EPS Next 3Y10.12%
EPS Next 5YN/A
Revenue Next Year-2.51%
Revenue Next 2Y1.26%
Revenue Next 3Y1.73%
Revenue Next 5YN/A
3.3 Evolution
- The estimated forward EPS growth is still strong, although it is decreasing when compared to the stronger growth in the past years.
- The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
- With a Price/Earnings ratio of 15.40, NWC is valued correctly.
- Based on the Price/Earnings ratio, NWC is valued a bit cheaper than the industry average as 70.59% of the companies are valued more expensively.
- When comparing the Price/Earnings ratio of NWC to the average of the S&P500 Index (27.21), we can say NWC is valued slightly cheaper.
- The Price/Forward Earnings ratio is 12.76, which indicates a correct valuation of NWC.
- NWC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. NWC is cheaper than 70.59% of the companies in the same industry.
- When comparing the Price/Forward Earnings ratio of NWC to the average of the S&P500 Index (25.98), we can say NWC is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.4 | ||
| Fwd PE | 12.76 |
4.2 Price Multiples
- NWC's Enterprise Value to EBITDA is on the same level as the industry average.
- NWC's Price/Free Cash Flow ratio is a bit more expensive when compared to the industry. NWC is more expensive than 64.71% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 20.85 | ||
| EV/EBITDA | 8.41 |
4.3 Compensation for Growth
- The PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
- The excellent profitability rating of NWC may justify a higher PE ratio.
PEG (NY)1.11
PEG (5Y)1
EPS Next 2Y14.83%
EPS Next 3Y10.12%
5. Dividend
5.1 Amount
- With a Yearly Dividend Yield of 3.25%, NWC has a reasonable but not impressive dividend return.
- Compared to an average industry Dividend Yield of 2.25, NWC pays a bit more dividend than its industry peers.
- Compared to an average S&P500 Dividend Yield of 1.81, NWC pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.25% |
5.2 History
- The dividend of NWC has a limited annual growth rate of 3.72%.
- NWC has paid a dividend for at least 10 years, which is a reliable track record.
- NWC has not decreased its dividend for at least 10 years, so it has a reliable track record of non decreasing dividend.
Dividend Growth(5Y)3.72%
Div Incr Years6
Div Non Decr Years13
5.3 Sustainability
- 53.85% of the earnings are spent on dividend by NWC. This is a bit on the high side, but may be sustainable.
- NWC's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP53.85%
EPS Next 2Y14.83%
EPS Next 3Y10.12%
NORTH WEST CO INC/THE / NWC.CA FAQ
Can you provide the ChartMill fundamental rating for NORTH WEST CO INC/THE?
ChartMill assigns a fundamental rating of 6 / 10 to NWC.CA.
Can you provide the valuation status for NORTH WEST CO INC/THE?
ChartMill assigns a valuation rating of 5 / 10 to NORTH WEST CO INC/THE (NWC.CA). This can be considered as Fairly Valued.
What is the profitability of NWC stock?
NORTH WEST CO INC/THE (NWC.CA) has a profitability rating of 8 / 10.
Can you provide the PE and PB ratios for NWC stock?
The Price/Earnings (PE) ratio for NORTH WEST CO INC/THE (NWC.CA) is 15.4 and the Price/Book (PB) ratio is 3.04.
How sustainable is the dividend of NORTH WEST CO INC/THE (NWC.CA) stock?
The dividend rating of NORTH WEST CO INC/THE (NWC.CA) is 8 / 10 and the dividend payout ratio is 53.85%.