RESTAURANT BRANDS INTERN (QSR) Stock Fundamental Analysis
NYSE:QSR - New York Stock Exchange, Inc. - CA76131D1033 - Common Stock - Currency: USD
We assign a fundamental rating of 5 out of 10 to QSR. QSR was compared to 133 industry peers in the Hotels, Restaurants & Leisure industry. QSR has an excellent profitability rating, but there are concerns on its financial health. QSR is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year QSR was profitable.
In the past year QSR had a positive cash flow from operations.
Each year in the past 5 years QSR has been profitable.
In the past 5 years QSR always reported a positive cash flow from operatings.
1.2 Ratios
With a decent Return On Assets value of 3.82%, QSR is doing good in the industry, outperforming 60.15% of the companies in the same industry.
Looking at the Return On Equity, with a value of 30.49%, QSR belongs to the top of the industry, outperforming 84.21% of the companies in the same industry.
The Return On Invested Capital of QSR (8.29%) is better than 66.92% of its industry peers.
The Average Return On Invested Capital over the past 3 years for QSR is significantly below the industry average of 13.81%.
The last Return On Invested Capital (8.29%) for QSR is above the 3 year average (8.03%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.82% | ||
| ROE | 30.49% | ||
| ROIC | 8.29% |
ROA(3y)4.55%
ROA(5y)3.88%
ROE(3y)38.23%
ROE(5y)34.92%
ROIC(3y)8.03%
ROIC(5y)7.44%
1.3 Margins
QSR's Profit Margin of 10.82% is fine compared to the rest of the industry. QSR outperforms 78.95% of its industry peers.
QSR's Profit Margin has been stable in the last couple of years.
Looking at the Operating Margin, with a value of 26.31%, QSR belongs to the top of the industry, outperforming 93.23% of the companies in the same industry.
In the last couple of years the Operating Margin of QSR has declined.
With a decent Gross Margin value of 56.03%, QSR is doing good in the industry, outperforming 68.42% of the companies in the same industry.
QSR's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 26.31% | ||
| PM (TTM) | 10.82% | ||
| GM | 56.03% |
OM growth 3Y-5.89%
OM growth 5Y-5.16%
PM growth 3Y-5.95%
PM growth 5Y1.14%
GM growth 3Y-4.56%
GM growth 5Y-2.9%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so QSR is still creating some value.
The number of shares outstanding for QSR has been increased compared to 1 year ago.
QSR has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, QSR has about the same debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.37, we must say that QSR is in the distress zone and has some risk of bankruptcy.
QSR has a Altman-Z score of 1.37. This is comparable to the rest of the industry: QSR outperforms 45.86% of its industry peers.
The Debt to FCF ratio of QSR is 12.37, which is on the high side as it means it would take QSR, 12.37 years of fcf income to pay off all of its debts.
QSR has a Debt to FCF ratio (12.37) which is comparable to the rest of the industry.
A Debt/Equity ratio of 4.40 is on the high side and indicates that QSR has dependencies on debt financing.
QSR has a worse Debt to Equity ratio (4.40) than 61.65% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.4 | ||
| Debt/FCF | 12.37 | ||
| Altman-Z | 1.37 |
ROIC/WACC1.02
WACC8.1%
2.3 Liquidity
QSR has a Current Ratio of 0.96. This is a bad value and indicates that QSR is not financially healthy enough and could expect problems in meeting its short term obligations.
The Current ratio of QSR (0.96) is comparable to the rest of the industry.
QSR has a Quick Ratio of 0.96. This is a bad value and indicates that QSR is not financially healthy enough and could expect problems in meeting its short term obligations.
QSR has a Quick ratio of 0.90. This is comparable to the rest of the industry: QSR outperforms 54.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.96 | ||
| Quick Ratio | 0.9 |
3. Growth
3.1 Past
QSR shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 3.72%.
The Earnings Per Share has been growing slightly by 4.05% on average over the past years.
QSR shows a strong growth in Revenue. In the last year, the Revenue has grown by 22.38%.
QSR shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.45% yearly.
EPS 1Y (TTM)3.72%
EPS 3Y5.7%
EPS 5Y4.05%
EPS Q2Q%2.74%
Revenue 1Y (TTM)22.38%
Revenue growth 3Y13.57%
Revenue growth 5Y8.45%
Sales Q2Q%21.28%
3.2 Future
The Earnings Per Share is expected to grow by 7.85% on average over the next years.
The Revenue is expected to grow by 2.84% on average over the next years.
EPS Next Y11.44%
EPS Next 2Y10.39%
EPS Next 3Y9.86%
EPS Next 5Y7.85%
Revenue Next Year8.61%
Revenue Next 2Y5.88%
Revenue Next 3Y4.98%
Revenue Next 5Y2.84%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 20.10 indicates a rather expensive valuation of QSR.
72.18% of the companies in the same industry are more expensive than QSR, based on the Price/Earnings ratio.
The average S&P500 Price/Earnings ratio is at 27.30. QSR is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 16.59 indicates a correct valuation of QSR.
Based on the Price/Forward Earnings ratio, QSR is valued a bit cheaper than the industry average as 71.43% of the companies are valued more expensively.
QSR's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.76.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.1 | ||
| Fwd PE | 16.59 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of QSR is on the same level as its industry peers.
QSR's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. QSR is cheaper than 76.69% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 19.58 | ||
| EV/EBITDA | 13.58 |
4.3 Compensation for Growth
QSR's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
The decent profitability rating of QSR may justify a higher PE ratio.
PEG (NY)1.76
PEG (5Y)4.96
EPS Next 2Y10.39%
EPS Next 3Y9.86%
5. Dividend
5.1 Amount
QSR has a Yearly Dividend Yield of 3.58%.
QSR's Dividend Yield is rather good when compared to the industry average which is at 3.53. QSR pays more dividend than 87.97% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.37, QSR pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.58% |
5.2 History
The dividend of QSR decreases each year by -6.88%.
QSR has been paying a dividend for at least 10 years, so it has a reliable track record.
As QSR did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)-6.88%
Div Incr Years9
Div Non Decr Years9
5.3 Sustainability
QSR pays out 110.11% of its income as dividend. This is not a sustainable payout ratio.
DP110.11%
EPS Next 2Y10.39%
EPS Next 3Y9.86%
67.34
-0.41 (-0.61%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners90.45%
Inst Owner Change0%
Ins Owners1.34%
Ins Owner Change11.51%
Market Cap22.06B
Analysts77.14
Price Target79.22 (17.64%)
Short Float %2.65%
Short Ratio2.87
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.58% |
Yearly Dividend2.29
Dividend Growth(5Y)-6.88%
DP110.11%
Div Incr Years9
Div Non Decr Years9
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.57%
Min EPS beat(2)-5.14%
Max EPS beat(2)2.01%
EPS beat(4)1
Avg EPS beat(4)-1.93%
Min EPS beat(4)-5.14%
Max EPS beat(4)2.01%
EPS beat(8)5
Avg EPS beat(8)0.98%
EPS beat(12)8
Avg EPS beat(12)4.24%
EPS beat(16)12
Avg EPS beat(16)5.29%
Revenue beat(2)0
Avg Revenue beat(2)-0.91%
Min Revenue beat(2)-1.82%
Max Revenue beat(2)0%
Revenue beat(4)1
Avg Revenue beat(4)-0.43%
Min Revenue beat(4)-1.82%
Max Revenue beat(4)1.76%
Revenue beat(8)3
Avg Revenue beat(8)-0.42%
Revenue beat(12)7
Avg Revenue beat(12)0.34%
Revenue beat(16)10
Avg Revenue beat(16)0.58%
PT rev (1m)2.54%
PT rev (3m)-1.03%
EPS NQ rev (1m)-0.21%
EPS NQ rev (3m)0.38%
EPS NY rev (1m)-0.36%
EPS NY rev (3m)-1.93%
Revenue NQ rev (1m)-0.04%
Revenue NQ rev (3m)-0.47%
Revenue NY rev (1m)-0.16%
Revenue NY rev (3m)-0.55%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.1 | ||
| Fwd PE | 16.59 | ||
| P/S | 2.51 | ||
| P/FCF | 19.58 | ||
| P/OCF | 16.15 | ||
| P/B | 7.08 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.58 |
EPS(TTM)3.35
EY4.97%
EPS(NY)4.06
Fwd EY6.03%
FCF(TTM)3.44
FCFY5.11%
OCF(TTM)4.17
OCFY6.19%
SpS26.79
BVpS9.51
TBVpS-42.47
PEG (NY)1.76
PEG (5Y)4.96
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.82% | ||
| ROE | 30.49% | ||
| ROCE | 10.38% | ||
| ROIC | 8.29% | ||
| ROICexc | 8.64% | ||
| ROICexgc | 42.65% | ||
| OM | 26.31% | ||
| PM (TTM) | 10.82% | ||
| GM | 56.03% | ||
| FCFM | 12.84% |
ROA(3y)4.55%
ROA(5y)3.88%
ROE(3y)38.23%
ROE(5y)34.92%
ROIC(3y)8.03%
ROIC(5y)7.44%
ROICexc(3y)8.51%
ROICexc(5y)7.9%
ROICexgc(3y)52.12%
ROICexgc(5y)49.93%
ROCE(3y)10.05%
ROCE(5y)9.31%
ROICexcg growth 3Y-4.66%
ROICexcg growth 5Y-3.62%
ROICexc growth 3Y5.76%
ROICexc growth 5Y1.01%
OM growth 3Y-5.89%
OM growth 5Y-5.16%
PM growth 3Y-5.95%
PM growth 5Y1.14%
GM growth 3Y-4.56%
GM growth 5Y-2.9%
F-Score5
Asset Turnover0.35
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.4 | ||
| Debt/FCF | 12.37 | ||
| Debt/EBITDA | 5.29 | ||
| Cap/Depr | 83.57% | ||
| Cap/Sales | 2.72% | ||
| Interest Coverage | 3.01 | ||
| Cash Conversion | 52.64% | ||
| Profit Quality | 118.63% | ||
| Current Ratio | 0.96 | ||
| Quick Ratio | 0.9 | ||
| Altman-Z | 1.37 |
F-Score5
WACC8.1%
ROIC/WACC1.02
Cap/Depr(3y)63.87%
Cap/Depr(5y)61.25%
Cap/Sales(3y)1.88%
Cap/Sales(5y)1.97%
Profit Quality(3y)122.17%
Profit Quality(5y)145.05%
High Growth Momentum
Growth
EPS 1Y (TTM)3.72%
EPS 3Y5.7%
EPS 5Y4.05%
EPS Q2Q%2.74%
EPS Next Y11.44%
EPS Next 2Y10.39%
EPS Next 3Y9.86%
EPS Next 5Y7.85%
Revenue 1Y (TTM)22.38%
Revenue growth 3Y13.57%
Revenue growth 5Y8.45%
Sales Q2Q%21.28%
Revenue Next Year8.61%
Revenue Next 2Y5.88%
Revenue Next 3Y4.98%
Revenue Next 5Y2.84%
EBIT growth 1Y6.21%
EBIT growth 3Y6.88%
EBIT growth 5Y2.85%
EBIT Next Year23.36%
EBIT Next 3Y11.29%
EBIT Next 5Y9.29%
FCF growth 1Y-9.33%
FCF growth 3Y-7.03%
FCF growth 5Y-1.64%
OCF growth 1Y1.11%
OCF growth 3Y-4.51%
OCF growth 5Y0.36%