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 136 industry peers in the Hotels, Restaurants & Leisure industry. QSR scores excellent on profitability, 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.
QSR had a positive operating cash flow in the past year.
In the past 5 years QSR has always been profitable.
Each year in the past 5 years QSR had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 4.15%, QSR is doing good in the industry, outperforming 63.24% of the companies in the same industry.
Looking at the Return On Equity, with a value of 32.83%, QSR belongs to the top of the industry, outperforming 85.29% of the companies in the same industry.
QSR has a Return On Invested Capital of 8.27%. This is in the better half of the industry: QSR outperforms 66.18% of its industry peers.
The Average Return On Invested Capital over the past 3 years for QSR is significantly below the industry average of 15.70%.
The last Return On Invested Capital (8.27%) for QSR is above the 3 year average (8.00%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.15% | ||
| ROE | 32.83% | ||
| ROIC | 8.27% |
ROA(3y)4.55%
ROA(5y)3.88%
ROE(3y)38.23%
ROE(5y)34.92%
ROIC(3y)8%
ROIC(5y)7.42%
1.3 Margins
QSR's Profit Margin of 12.15% is fine compared to the rest of the industry. QSR outperforms 78.68% 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 27.43%, QSR belongs to the top of the industry, outperforming 94.12% of the companies in the same industry.
QSR's Operating Margin has declined in the last couple of years.
QSR's Gross Margin of 58.32% is fine compared to the rest of the industry. QSR outperforms 71.32% of its industry peers.
QSR's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 27.43% | ||
| PM (TTM) | 12.15% | ||
| GM | 58.32% |
OM growth 3Y-6.19%
OM growth 5Y-5.34%
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
QSR has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for QSR has been increased compared to 1 year ago.
The number of shares outstanding for QSR has been increased compared to 5 years ago.
QSR has about the same debt/assets ratio as last year.
2.2 Solvency
Based on the Altman-Z score of 1.32, we must say that QSR is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.32, QSR is in line with its industry, outperforming 45.59% of the companies in the same industry.
The Debt to FCF ratio of QSR is 10.72, which is on the high side as it means it would take QSR, 10.72 years of fcf income to pay off all of its debts.
QSR has a Debt to FCF ratio of 10.72. This is comparable to the rest of the industry: QSR outperforms 56.62% of its industry peers.
A Debt/Equity ratio of 4.42 is on the high side and indicates that QSR has dependencies on debt financing.
QSR has a Debt to Equity ratio of 4.42. This is comparable to the rest of the industry: QSR outperforms 41.91% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.42 | ||
| Debt/FCF | 10.72 | ||
| Altman-Z | 1.32 |
ROIC/WACC1.06
WACC7.81%
2.3 Liquidity
QSR has a Current Ratio of 0.97. 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 Current ratio of 0.97. This is comparable to the rest of the industry: QSR outperforms 55.15% of its industry peers.
A Quick Ratio of 0.91 indicates that QSR may have some problems paying its short term obligations.
QSR has a Quick ratio of 0.91. This is comparable to the rest of the industry: QSR outperforms 55.15% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.97 | ||
| Quick Ratio | 0.91 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 2.46% over the past year.
QSR shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 4.05% yearly.
Looking at the last year, QSR shows a quite strong growth in Revenue. The Revenue has grown by 19.71% in the last year.
Measured over the past years, QSR shows a quite strong growth in Revenue. The Revenue has been growing by 8.45% on average per year.
EPS 1Y (TTM)2.46%
EPS 3Y5.7%
EPS 5Y4.05%
EPS Q2Q%8%
Revenue 1Y (TTM)19.71%
Revenue growth 3Y13.57%
Revenue growth 5Y8.45%
Sales Q2Q%26.15%
3.2 Future
Based on estimates for the next years, QSR will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.29% on average per year.
QSR is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.50% yearly.
EPS Next Y13.36%
EPS Next 2Y11.03%
EPS Next 3Y10.55%
EPS Next 5Y9.29%
Revenue Next Year9.11%
Revenue Next 2Y6.3%
Revenue Next 3Y5.44%
Revenue Next 5Y3.5%
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
Based on the Price/Earnings ratio of 18.98, the valuation of QSR can be described as rather expensive.
Based on the Price/Earnings ratio, QSR is valued a bit cheaper than 68.38% of the companies in the same industry.
The average S&P500 Price/Earnings ratio is at 28.29. QSR is valued slightly cheaper when compared to this.
A Price/Forward Earnings ratio of 16.75 indicates a correct valuation of QSR.
QSR's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. QSR is cheaper than 69.12% of the companies in the same industry.
QSR's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 21.08.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.98 | ||
| Fwd PE | 16.75 |
4.2 Price Multiples
QSR's Enterprise Value to EBITDA ratio is in line with the industry average.
Based on the Price/Free Cash Flow ratio, QSR is valued a bit cheaper than the industry average as 78.68% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 15.78 | ||
| EV/EBITDA | 12.91 |
4.3 Compensation for Growth
The 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)1.42
PEG (5Y)4.68
EPS Next 2Y11.03%
EPS Next 3Y10.55%
5. Dividend
5.1 Amount
QSR has a Yearly Dividend Yield of 3.81%.
QSR's Dividend Yield is rather good when compared to the industry average which is at 3.92. QSR pays more dividend than 87.50% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 2.52, QSR pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.81% |
5.2 History
The dividend of QSR decreases each year by -6.89%.
QSR has paid a dividend for at least 10 years, which is 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)-6.89%
Div Incr Years9
Div Non Decr Years9
5.3 Sustainability
100.78% of the earnings are spent on dividend by QSR. This is not a sustainable payout ratio.
DP100.78%
EPS Next 2Y11.03%
EPS Next 3Y10.55%
63.22
+0.97 (+1.56%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners86.81%
Inst Owner Change0.02%
Ins Owners1.15%
Ins Owner Change14.28%
Market Cap20.55B
Analysts78
Price Target80.05 (26.62%)
Short Float %2.68%
Short Ratio3.86
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.81% |
Yearly Dividend2.29
Dividend Growth(5Y)-6.89%
DP100.78%
Div Incr Years9
Div Non Decr Years9
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-0.63%
Min EPS beat(2)-3.26%
Max EPS beat(2)2.01%
EPS beat(4)2
Avg EPS beat(4)-0.51%
Min EPS beat(4)-3.26%
Max EPS beat(4)2.01%
EPS beat(8)6
Avg EPS beat(8)3.67%
EPS beat(12)9
Avg EPS beat(12)4.78%
EPS beat(16)13
Avg EPS beat(16)6.12%
Revenue beat(2)0
Avg Revenue beat(2)-0.84%
Min Revenue beat(2)-1.67%
Max Revenue beat(2)0%
Revenue beat(4)2
Avg Revenue beat(4)0.3%
Min Revenue beat(4)-1.67%
Max Revenue beat(4)1.76%
Revenue beat(8)4
Avg Revenue beat(8)-0.11%
Revenue beat(12)8
Avg Revenue beat(12)0.64%
Revenue beat(16)10
Avg Revenue beat(16)0.68%
PT rev (1m)-0.17%
PT rev (3m)-3.87%
EPS NQ rev (1m)-0.44%
EPS NQ rev (3m)-4.63%
EPS NY rev (1m)-0.31%
EPS NY rev (3m)-1.52%
Revenue NQ rev (1m)-0.19%
Revenue NQ rev (3m)-1.87%
Revenue NY rev (1m)-0.04%
Revenue NY rev (3m)-1.54%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.98 | ||
| Fwd PE | 16.75 | ||
| P/S | 2.44 | ||
| P/FCF | 15.78 | ||
| P/OCF | 13.67 | ||
| P/B | 6.61 | ||
| P/tB | N/A | ||
| EV/EBITDA | 12.91 |
EPS(TTM)3.33
EY5.27%
EPS(NY)3.77
Fwd EY5.97%
FCF(TTM)4.01
FCFY6.34%
OCF(TTM)4.62
OCFY7.32%
SpS25.87
BVpS9.57
TBVpS-42.46
PEG (NY)1.42
PEG (5Y)4.68
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.15% | ||
| ROE | 32.83% | ||
| ROCE | 10.36% | ||
| ROIC | 8.27% | ||
| ROICexc | 8.8% | ||
| ROICexgc | 45.75% | ||
| OM | 27.43% | ||
| PM (TTM) | 12.15% | ||
| GM | 58.32% | ||
| FCFM | 15.49% |
ROA(3y)4.55%
ROA(5y)3.88%
ROE(3y)38.23%
ROE(5y)34.92%
ROIC(3y)8%
ROIC(5y)7.42%
ROICexc(3y)8.48%
ROICexc(5y)7.89%
ROICexgc(3y)51.98%
ROICexgc(5y)49.84%
ROCE(3y)10.01%
ROCE(5y)9.29%
ROICexcg growth 3Y-4.96%
ROICexcg growth 5Y-3.8%
ROICexc growth 3Y5.42%
ROICexc growth 5Y0.81%
OM growth 3Y-6.19%
OM growth 5Y-5.34%
PM growth 3Y-5.95%
PM growth 5Y1.14%
GM growth 3Y-4.56%
GM growth 5Y-2.9%
F-Score5
Asset Turnover0.34
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.42 | ||
| Debt/FCF | 10.72 | ||
| Debt/EBITDA | 5.35 | ||
| Cap/Depr | 76.14% | ||
| Cap/Sales | 2.39% | ||
| Interest Coverage | 2.94 | ||
| Cash Conversion | 58.48% | ||
| Profit Quality | 127.52% | ||
| Current Ratio | 0.97 | ||
| Quick Ratio | 0.91 | ||
| Altman-Z | 1.32 |
F-Score5
WACC7.81%
ROIC/WACC1.06
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)2.46%
EPS 3Y5.7%
EPS 5Y4.05%
EPS Q2Q%8%
EPS Next Y13.36%
EPS Next 2Y11.03%
EPS Next 3Y10.55%
EPS Next 5Y9.29%
Revenue 1Y (TTM)19.71%
Revenue growth 3Y13.57%
Revenue growth 5Y8.45%
Sales Q2Q%26.15%
Revenue Next Year9.11%
Revenue Next 2Y6.3%
Revenue Next 3Y5.44%
Revenue Next 5Y3.5%
EBIT growth 1Y8.88%
EBIT growth 3Y6.54%
EBIT growth 5Y2.65%
EBIT Next Year22.9%
EBIT Next 3Y10.66%
EBIT Next 5Y9.29%
FCF growth 1Y8.23%
FCF growth 3Y-7.03%
FCF growth 5Y-1.64%
OCF growth 1Y13.61%
OCF growth 3Y-4.51%
OCF growth 5Y0.36%