WESCO INTERNATIONAL INC (WCC) Stock Fundamental Analysis
NYSE:WCC - New York Stock Exchange, Inc. - US95082P1057 - Common Stock - Currency: USD
Overall WCC gets a fundamental rating of 5 out of 10. We evaluated WCC against 48 industry peers in the Trading Companies & Distributors industry. Both the profitability and the financial health of WCC get a neutral evaluation. Nothing too spectacular is happening here. WCC is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
WCC had positive earnings in the past year.
WCC had a positive operating cash flow in the past year.
WCC had positive earnings in each of the past 5 years.
Each year in the past 5 years WCC had a positive operating cash flow.
1.2 Ratios
With a decent Return On Assets value of 4.27%, WCC is doing good in the industry, outperforming 60.42% of the companies in the same industry.
Looking at the Return On Equity, with a value of 13.16%, WCC is in line with its industry, outperforming 56.25% of the companies in the same industry.
WCC's Return On Invested Capital of 8.32% is fine compared to the rest of the industry. WCC outperforms 66.67% of its industry peers.
WCC had an Average Return On Invested Capital over the past 3 years of 9.61%. This is in line with the industry average of 9.62%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.27% | ||
| ROE | 13.16% | ||
| ROIC | 8.32% |
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
WCC's Profit Margin of 3.04% is in line compared to the rest of the industry. WCC outperforms 50.00% of its industry peers.
In the last couple of years the Profit Margin of WCC has grown nicely.
WCC has a Operating Margin of 5.73%. This is comparable to the rest of the industry: WCC outperforms 43.75% of its industry peers.
WCC's Operating Margin has improved in the last couple of years.
Looking at the Gross Margin, with a value of 21.55%, WCC is doing worse than 75.00% of the companies in the same industry.
WCC's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.73% | ||
| PM (TTM) | 3.04% | ||
| GM | 21.55% |
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.
WCC has less shares outstanding than it did 1 year ago.
WCC has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, WCC has an improved debt to assets ratio.
2.2 Solvency
WCC has an Altman-Z score of 3.04. This indicates that WCC is financially healthy and has little risk of bankruptcy at the moment.
WCC has a Altman-Z score (3.04) which is in line with its industry peers.
The Debt to FCF ratio of WCC is 17.90, which is on the high side as it means it would take WCC, 17.90 years of fcf income to pay off all of its debts.
WCC has a Debt to FCF ratio of 17.90. This is comparable to the rest of the industry: WCC outperforms 47.92% of its industry peers.
WCC has a Debt/Equity ratio of 1.02. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of WCC (1.02) is worse than 66.67% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.02 | ||
| Debt/FCF | 17.9 | ||
| Altman-Z | 3.04 |
ROIC/WACC0.83
WACC9.98%
2.3 Liquidity
A Current Ratio of 2.15 indicates that WCC has no problem at all paying its short term obligations.
WCC has a Current ratio of 2.15. This is comparable to the rest of the industry: WCC outperforms 56.25% of its industry peers.
A Quick Ratio of 1.23 indicates that WCC should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.23, WCC is in line with its industry, outperforming 47.92% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.15 | ||
| Quick Ratio | 1.23 |
3. Growth
3.1 Past
The earnings per share for WCC have decreased by -7.53% in the last year.
Measured over the past years, WCC shows a quite strong growth in Earnings Per Share. The EPS has been growing by 18.60% on average per year.
WCC shows a decrease in Revenue. In the last year, the revenue decreased by -1.80%.
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)-7.53%
EPS 3Y7.07%
EPS 5Y18.6%
EPS Q2Q%-3.91%
Revenue 1Y (TTM)-1.8%
Revenue growth 3Y6.2%
Revenue growth 5Y21.15%
Sales Q2Q%-0.12%
3.2 Future
WCC is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 8.04% yearly.
Based on estimates for the next years, WCC will show a small growth in Revenue. The Revenue will grow by 4.55% on average per year.
EPS Next Y8.42%
EPS Next 2Y13.74%
EPS Next 3Y15.05%
EPS Next 5Y8.04%
Revenue Next Year3.61%
Revenue Next 2Y3.94%
Revenue Next 3Y4.04%
Revenue Next 5Y4.55%
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 decreasing.
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 16.29, the valuation of WCC can be described as correct.
Based on the Price/Earnings ratio, WCC is valued a bit cheaper than 79.17% of the companies in the same industry.
When comparing the Price/Earnings ratio of WCC to the average of the S&P500 Index (27.18), we can say WCC is valued slightly cheaper.
WCC is valuated correctly with a Price/Forward Earnings ratio of 12.50.
Based on the Price/Forward Earnings ratio, WCC is valued a bit cheaper than the industry average as 75.00% of the companies are valued more expensively.
WCC is valuated cheaply when we compare the Price/Forward Earnings ratio to 35.34, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.29 | ||
| Fwd PE | 12.5 |
4.2 Price Multiples
66.67% 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 is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 33.55 | ||
| EV/EBITDA | 9.86 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates WCC does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of WCC may justify a higher PE ratio.
A more expensive valuation may be justified as WCC's earnings are expected to grow with 15.05% in the coming years.
PEG (NY)1.94
PEG (5Y)0.88
EPS Next 2Y13.74%
EPS Next 3Y15.05%
5. Dividend
5.1 Amount
With a yearly dividend of 0.90%, WCC is not a good candidate for dividend investing.
WCC's Dividend Yield is a higher than the industry average which is at 2.01.
With a Dividend Yield of 0.90, WCC pays less dividend than the S&P500 average, which is at 2.34.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.9% |
5.2 History
WCC has been paying a dividend for less than 5 years, so it still needs to build a track record.
Dividend Growth(5Y)N/A
Div Incr Years1
Div Non Decr Years1
5.3 Sustainability
WCC pays out 21.14% of its income as dividend. This is a sustainable payout ratio.
DP21.14%
EPS Next 2Y13.74%
EPS Next 3Y15.05%
198.14
+0.12 (+0.06%)
Chartmill FA Rating
GICS SectorIndustrials
GICS IndustryGroupCapital Goods
GICS IndustryTrading Companies & Distributors
Earnings (Last)
Earnings (Next)
Inst Owners100.16%
Inst Owner Change0.12%
Ins Owners1.85%
Ins Owner Change2.31%
Market Cap9.67B
Analysts85
Price Target206.86 (4.4%)
Short Float %3.89%
Short Ratio2.94
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.9% |
Yearly Dividend2.79
Dividend Growth(5Y)N/A
DP21.14%
Div Incr Years1
Div Non Decr Years1
Ex-Date
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-4.37%
Min EPS beat(2)-5.55%
Max EPS beat(2)-3.19%
EPS beat(4)1
Avg EPS beat(4)-2.49%
Min EPS beat(4)-11.8%
Max EPS beat(4)10.59%
EPS beat(8)2
Avg EPS beat(8)-6.83%
EPS beat(12)6
Avg EPS beat(12)-3.06%
EPS beat(16)10
Avg EPS beat(16)5.69%
Revenue beat(2)2
Avg Revenue beat(2)0.62%
Min Revenue beat(2)0.54%
Max Revenue beat(2)0.69%
Revenue beat(4)3
Avg Revenue beat(4)0.54%
Min Revenue beat(4)-2.41%
Max Revenue beat(4)3.36%
Revenue beat(8)3
Avg Revenue beat(8)-0.78%
Revenue beat(12)6
Avg Revenue beat(12)-0.23%
Revenue beat(16)9
Avg Revenue beat(16)0.63%
PT rev (1m)1.5%
PT rev (3m)-8.7%
EPS NQ rev (1m)0%
EPS NQ rev (3m)-3.88%
EPS NY rev (1m)-0.28%
EPS NY rev (3m)-2.67%
Revenue NQ rev (1m)0.07%
Revenue NQ rev (3m)2.92%
Revenue NY rev (1m)0.01%
Revenue NY rev (3m)0.8%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.29 | ||
| Fwd PE | 12.5 | ||
| P/S | 0.44 | ||
| P/FCF | 33.55 | ||
| P/OCF | 25.25 | ||
| P/B | 1.92 | ||
| P/tB | N/A | ||
| EV/EBITDA | 9.86 |
EPS(TTM)12.16
EY6.14%
EPS(NY)15.85
Fwd EY8%
FCF(TTM)5.91
FCFY2.98%
OCF(TTM)7.85
OCFY3.96%
SpS446.98
BVpS103.18
TBVpS-1.92
PEG (NY)1.94
PEG (5Y)0.88
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.27% | ||
| ROE | 13.16% | ||
| ROCE | 10.88% | ||
| ROIC | 8.32% | ||
| ROICexc | 8.84% | ||
| ROICexgc | 16.84% | ||
| OM | 5.73% | ||
| PM (TTM) | 3.04% | ||
| GM | 21.55% | ||
| FCFM | 1.32% |
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-Score6
Asset Turnover1.41
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.02 | ||
| Debt/FCF | 17.9 | ||
| Debt/EBITDA | 3.58 | ||
| Cap/Depr | 50.89% | ||
| Cap/Sales | 0.43% | ||
| Interest Coverage | 3.25 | ||
| Cash Conversion | 26.68% | ||
| Profit Quality | 43.49% | ||
| Current Ratio | 2.15 | ||
| Quick Ratio | 1.23 | ||
| Altman-Z | 3.04 |
F-Score6
WACC9.98%
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)-7.53%
EPS 3Y7.07%
EPS 5Y18.6%
EPS Q2Q%-3.91%
EPS Next Y8.42%
EPS Next 2Y13.74%
EPS Next 3Y15.05%
EPS Next 5Y8.04%
Revenue 1Y (TTM)-1.8%
Revenue growth 3Y6.2%
Revenue growth 5Y21.15%
Sales Q2Q%-0.12%
Revenue Next Year3.61%
Revenue Next 2Y3.94%
Revenue Next 3Y4.04%
Revenue Next 5Y4.55%
EBIT growth 1Y-10.12%
EBIT growth 3Y10.33%
EBIT growth 5Y29.86%
EBIT Next Year17.25%
EBIT Next 3Y11.21%
EBIT Next 5Y6.58%
FCF growth 1Y269.02%
FCF growth 3Y333.07%
FCF growth 5Y41.05%
OCF growth 1Y628.5%
OCF growth 3Y154.08%
OCF growth 5Y37.46%