WESCO INTERNATIONAL INC (WCC) Stock Fundamental Analysis
NYSE:WCC - New York Stock Exchange, Inc. - US95082P1057 - Common Stock - Currency: USD
Taking everything into account, WCC scores 5 out of 10 in our fundamental rating. WCC was compared to 49 industry peers in the Trading Companies & Distributors industry. WCC has an average financial health and profitability rating. WCC is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year WCC was profitable.
In the past year WCC had a positive cash flow from operations.
Each year in the past 5 years WCC has been profitable.
In the past 5 years WCC always reported a positive cash flow from operatings.
1.2 Ratios
WCC's Return On Assets of 4.38% is in line compared to the rest of the industry. WCC outperforms 52.08% of its industry peers.
The Return On Equity of WCC (13.28%) is comparable to the rest of the industry.
WCC has a Return On Invested Capital (8.68%) which is in line with its industry peers.
The Average Return On Invested Capital over the past 3 years for WCC is in line with the industry average of 9.86%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.38% | ||
| ROE | 13.28% | ||
| ROIC | 8.68% |
ROA(3y)4.84%
ROA(5y)3.67%
ROE(3y)15.12%
ROE(5y)11.65%
ROIC(3y)9.61%
ROIC(5y)8.15%
1.3 Margins
The Profit Margin of WCC (3.03%) is worse than 60.42% of its industry peers.
WCC's Profit Margin has improved in the last couple of years.
The Operating Margin of WCC (5.86%) is worse than 66.67% of its industry peers.
In the last couple of years the Operating Margin of WCC has grown nicely.
WCC's Gross Margin of 21.60% is on the low side compared to the rest of the industry. WCC is outperformed by 77.08% of its industry peers.
WCC's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.86% | ||
| PM (TTM) | 3.03% | ||
| GM | 21.6% |
OM growth 3Y3.9%
OM growth 5Y7.19%
PM growth 3Y10.55%
PM growth 5Y2.55%
GM growth 3Y1.24%
GM growth 5Y2.69%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so WCC is destroying value.
Compared to 1 year ago, WCC has less shares outstanding
The number of shares outstanding for WCC has been increased compared to 5 years ago.
The debt/assets ratio for WCC has been reduced compared to a year ago.
2.2 Solvency
WCC has an Altman-Z score of 3.11. This indicates that WCC is financially healthy and has little risk of bankruptcy at the moment.
WCC's Altman-Z score of 3.11 is fine compared to the rest of the industry. WCC outperforms 60.42% of its industry peers.
WCC has a debt to FCF ratio of 5.03. This is a neutral value as WCC would need 5.03 years to pay back of all of its debts.
The Debt to FCF ratio of WCC (5.03) is better than 62.50% of its industry peers.
A Debt/Equity ratio of 1.02 is on the high side and indicates that WCC has dependencies on debt financing.
WCC's Debt to Equity ratio of 1.02 is on the low side compared to the rest of the industry. WCC is outperformed by 60.42% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.02 | ||
| Debt/FCF | 5.03 | ||
| Altman-Z | 3.11 |
ROIC/WACC0.83
WACC10.45%
2.3 Liquidity
WCC has a Current Ratio of 2.20. This indicates that WCC is financially healthy and has no problem in meeting its short term obligations.
WCC has a Current ratio (2.20) which is comparable to the rest of the industry.
A Quick Ratio of 1.27 indicates that WCC should not have too much problems paying its short term obligations.
WCC's Quick ratio of 1.27 is in line compared to the rest of the industry. WCC outperforms 54.17% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.2 | ||
| Quick Ratio | 1.27 |
3. Growth
3.1 Past
The earnings per share for WCC have decreased strongly by -16.10% in the last year.
WCC shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 18.60% yearly.
Looking at the last year, WCC shows a decrease in Revenue. The Revenue has decreased by -2.53% in the last year.
Measured over the past years, WCC shows a very strong growth in Revenue. The Revenue has been growing by 21.15% on average per year.
EPS 1Y (TTM)-16.1%
EPS 3Y7.07%
EPS 5Y18.6%
EPS Q2Q%19.25%
Revenue 1Y (TTM)-2.53%
Revenue growth 3Y6.2%
Revenue growth 5Y21.15%
Sales Q2Q%0.48%
3.2 Future
WCC is expected to show a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 23.43% yearly.
The Revenue is expected to grow by 7.57% on average over the next years.
EPS Next Y11.16%
EPS Next 2Y15.37%
EPS Next 3Y17.37%
EPS Next 5Y23.43%
Revenue Next Year2.83%
Revenue Next 2Y3.61%
Revenue Next 3Y4%
Revenue Next 5Y7.57%
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.
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
The Price/Earnings ratio is 14.95, which indicates a correct valuation of WCC.
WCC's Price/Earnings ratio is a bit cheaper when compared to the industry. WCC is cheaper than 64.58% of the companies in the same industry.
WCC is valuated rather cheaply when we compare the Price/Earnings ratio to 29.63, which is the current average of the S&P500 Index.
With a Price/Forward Earnings ratio of 13.45, WCC is valued correctly.
WCC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. WCC is cheaper than 70.83% of the companies in the same industry.
WCC's Price/Forward Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 22.68.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.95 | ||
| Fwd PE | 13.45 |
4.2 Price Multiples
64.58% of the companies in the same industry are more expensive than WCC, based on the Enterprise Value to EBITDA ratio.
WCC's Price/Free Cash Flow ratio is rather cheap when compared to the industry. WCC is cheaper than 87.50% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 8.92 | ||
| EV/EBITDA | 9.46 |
4.3 Compensation for Growth
WCC's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
WCC's earnings are expected to grow with 17.37% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.34
PEG (5Y)0.8
EPS Next 2Y15.37%
EPS Next 3Y17.37%
5. Dividend
5.1 Amount
WCC has a yearly dividend return of 0.85%, which is pretty low.
Compared to an average industry Dividend Yield of 1.87, WCC has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.29, WCC's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.85% |
5.2 History
WCC is new to the dividend game and has less than 3 years of track record.
Dividend Growth(5Y)N/A
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
21.04% of the earnings are spent on dividend by WCC. This is a low number and sustainable payout ratio.
DP21.04%
EPS Next 2Y15.37%
EPS Next 3Y17.37%
183.18
-9.83 (-5.09%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners97.16%
Inst Owner Change4.96%
Ins Owners1.73%
Ins Owner Change-0.63%
Market Cap8.98B
Analysts85
Price Target235.25 (28.43%)
Short Float %2.51%
Short Ratio1.72
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.85% |
Yearly Dividend2.79
Dividend Growth(5Y)N/A
DP21.04%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)3.7%
Min EPS beat(2)-3.19%
Max EPS beat(2)10.59%
EPS beat(4)1
Avg EPS beat(4)-3.51%
Min EPS beat(4)-11.8%
Max EPS beat(4)10.59%
EPS beat(8)3
Avg EPS beat(8)-5.63%
EPS beat(12)7
Avg EPS beat(12)2.58%
EPS beat(16)11
Avg EPS beat(16)10.76%
Revenue beat(2)2
Avg Revenue beat(2)2.02%
Min Revenue beat(2)0.69%
Max Revenue beat(2)3.36%
Revenue beat(4)2
Avg Revenue beat(4)0.37%
Min Revenue beat(4)-2.41%
Max Revenue beat(4)3.36%
Revenue beat(8)3
Avg Revenue beat(8)-0.74%
Revenue beat(12)6
Avg Revenue beat(12)0.2%
Revenue beat(16)8
Avg Revenue beat(16)0.58%
PT rev (1m)0.66%
PT rev (3m)12.08%
EPS NQ rev (1m)-0.15%
EPS NQ rev (3m)-0.01%
EPS NY rev (1m)-0.14%
EPS NY rev (3m)-0.07%
Revenue NQ rev (1m)-0.09%
Revenue NQ rev (3m)-0.13%
Revenue NY rev (1m)-0.02%
Revenue NY rev (3m)-0.03%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 14.95 | ||
| Fwd PE | 13.45 | ||
| P/S | 0.41 | ||
| P/FCF | 8.92 | ||
| P/OCF | 8.15 | ||
| P/B | 1.81 | ||
| P/tB | N/A | ||
| EV/EBITDA | 9.46 |
EPS(TTM)12.25
EY6.69%
EPS(NY)13.62
Fwd EY7.43%
FCF(TTM)20.54
FCFY11.21%
OCF(TTM)22.47
OCFY12.27%
SpS445.28
BVpS101.44
TBVpS-2.97
PEG (NY)1.34
PEG (5Y)0.8
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.38% | ||
| ROE | 13.28% | ||
| ROCE | 11.35% | ||
| ROIC | 8.68% | ||
| ROICexc | 9.26% | ||
| ROICexgc | 17.96% | ||
| OM | 5.86% | ||
| PM (TTM) | 3.03% | ||
| GM | 21.6% | ||
| FCFM | 4.61% |
ROA(3y)4.84%
ROA(5y)3.67%
ROE(3y)15.12%
ROE(5y)11.65%
ROIC(3y)9.61%
ROIC(5y)8.15%
ROICexc(3y)10.13%
ROICexc(5y)8.54%
ROICexgc(3y)19.5%
ROICexgc(5y)17.57%
ROCE(3y)12.57%
ROCE(5y)10.66%
ROICexcg growth 3Y1.25%
ROICexcg growth 5Y3.88%
ROICexc growth 3Y5.99%
ROICexc growth 5Y6.02%
OM growth 3Y3.9%
OM growth 5Y7.19%
PM growth 3Y10.55%
PM growth 5Y2.55%
GM growth 3Y1.24%
GM growth 5Y2.69%
F-Score5
Asset Turnover1.45
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.02 | ||
| Debt/FCF | 5.03 | ||
| Debt/EBITDA | 3.45 | ||
| Cap/Depr | 51.69% | ||
| Cap/Sales | 0.43% | ||
| Interest Coverage | 3.86 | ||
| Cash Conversion | 75.36% | ||
| Profit Quality | 152.48% | ||
| Current Ratio | 2.2 | ||
| Quick Ratio | 1.27 | ||
| Altman-Z | 3.11 |
F-Score5
WACC10.45%
ROIC/WACC0.83
Cap/Depr(3y)52.71%
Cap/Depr(5y)46.47%
Cap/Sales(3y)0.44%
Cap/Sales(5y)0.41%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-16.1%
EPS 3Y7.07%
EPS 5Y18.6%
EPS Q2Q%19.25%
EPS Next Y11.16%
EPS Next 2Y15.37%
EPS Next 3Y17.37%
EPS Next 5Y23.43%
Revenue 1Y (TTM)-2.53%
Revenue growth 3Y6.2%
Revenue growth 5Y21.15%
Sales Q2Q%0.48%
Revenue Next Year2.83%
Revenue Next 2Y3.61%
Revenue Next 3Y4%
Revenue Next 5Y7.57%
EBIT growth 1Y-13.56%
EBIT growth 3Y10.33%
EBIT growth 5Y29.86%
EBIT Next Year21.2%
EBIT Next 3Y10.13%
EBIT Next 5Y19.18%
FCF growth 1Y151.06%
FCF growth 3Y333.07%
FCF growth 5Y41.05%
OCF growth 1Y123.28%
OCF growth 3Y154.08%
OCF growth 5Y37.46%