WESTERN DIGITAL CORP (WDC) Stock Fundamental Analysis
USA - NASDAQ:WDC - US9581021055 - Common Stock
106.63 USD
+1.48 (+1.41%)
106.97 USD
+0.34 (+0.32%)
WDC gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 33 industry peers in the Technology Hardware, Storage & Peripherals industry. While WDC belongs to the best of the industry regarding profitability, there are some minor concerns on its financial health. WDC has a correct valuation and a medium growth rate.
1. Profitability
1.1 Basic Checks
In the past year WDC was profitable.
In the past year WDC had a positive cash flow from operations.
In multiple years WDC reported negative net income over the last 5 years.
In multiple years WDC reported negative operating cash flow during the last 5 years.
1.2 Ratios
With an excellent Return On Assets value of 13.16%, WDC belongs to the best of the industry, outperforming 90.91% of the companies in the same industry.
WDC has a better Return On Equity (33.25%) than 93.94% of its industry peers.
The Return On Invested Capital of WDC (25.82%) is better than 90.91% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.16% | ||
| ROE | 33.25% | ||
| ROIC | 25.82% |
ROA(3y)0.89%
ROA(5y)2.34%
ROE(3y)3.69%
ROE(5y)6.28%
ROIC(3y)N/A
ROIC(5y)N/A
1.3 Margins
WDC has a Profit Margin of 13.87%. This is amongst the best in the industry. WDC outperforms 87.88% of its industry peers.
WDC's Profit Margin has improved in the last couple of years.
The Operating Margin of WDC (21.13%) is better than 87.88% of its industry peers.
In the last couple of years the Operating Margin of WDC has grown nicely.
The Gross Margin of WDC (38.00%) is better than 72.73% of its industry peers.
In the last couple of years the Gross Margin of WDC has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 21.13% | ||
| PM (TTM) | 13.87% | ||
| GM | 38% |
OM growth 3Y16.77%
OM growth 5Y53.81%
PM growth 3Y32.94%
PM growth 5YN/A
GM growth 3Y6.22%
GM growth 5Y11.02%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) well above the Cost of Capital (WACC), WDC is creating value.
WDC has more shares outstanding than it did 1 year ago.
WDC has more shares outstanding than it did 5 years ago.
The debt/assets ratio for WDC is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 4.31 indicates that WDC is not in any danger for bankruptcy at the moment.
Looking at the Altman-Z score, with a value of 4.31, WDC is in the better half of the industry, outperforming 78.79% of the companies in the same industry.
The Debt to FCF ratio of WDC is 3.68, which is a good value as it means it would take WDC, 3.68 years of fcf income to pay off all of its debts.
WDC's Debt to FCF ratio of 3.68 is fine compared to the rest of the industry. WDC outperforms 69.70% of its industry peers.
WDC has a Debt/Equity ratio of 0.45. This is a healthy value indicating a solid balance between debt and equity.
WDC has a Debt to Equity ratio (0.45) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 3.68 | ||
| Altman-Z | 4.31 |
ROIC/WACC3.15
WACC8.21%
2.3 Liquidity
WDC has a Current Ratio of 1.08. This is a normal value and indicates that WDC is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of WDC (1.08) is worse than 66.67% of its industry peers.
WDC has a Quick Ratio of 1.08. This is a bad value and indicates that WDC is not financially healthy enough and could expect problems in meeting its short term obligations.
WDC has a Quick ratio (0.84) which is in line with its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.08 | ||
| Quick Ratio | 0.84 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 1828.95% over the past year.
WDC shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 16.66% yearly.
The Revenue for WDC has decreased by -15.70% in the past year. This is quite bad
Measured over the past years, WDC shows a very negative growth in Revenue. The Revenue has been decreasing by -10.67% on average per year.
EPS 1Y (TTM)1828.95%
EPS 3Y-7.2%
EPS 5Y16.66%
EPS Q2Q%15.28%
Revenue 1Y (TTM)-15.7%
Revenue growth 3Y-20.28%
Revenue growth 5Y-10.67%
Sales Q2Q%-30.79%
3.2 Future
The Earnings Per Share is expected to grow by 10.07% on average over the next years. This is quite good.
The Revenue is expected to grow by 7.74% on average over the next years.
EPS Next Y0.03%
EPS Next 2Y3.9%
EPS Next 3Y5.08%
EPS Next 5Y10.07%
Revenue Next Year17.43%
Revenue Next 2Y11.12%
Revenue Next 3Y7.79%
Revenue Next 5Y7.74%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
WDC is valuated correctly with a Price/Earnings ratio of 16.23.
Compared to the rest of the industry, the Price/Earnings ratio of WDC indicates a rather cheap valuation: WDC is cheaper than 87.88% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.38, WDC is valued a bit cheaper.
WDC is valuated correctly with a Price/Forward Earnings ratio of 16.23.
WDC's Price/Forward Earnings ratio is a bit cheaper when compared to the industry. WDC is cheaper than 63.64% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of WDC to the average of the S&P500 Index (22.86), we can say WDC is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.23 | ||
| Fwd PE | 16.23 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of WDC indicates a somewhat cheap valuation: WDC is cheaper than 72.73% of the companies listed in the same industry.
WDC's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. WDC is cheaper than 63.64% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.92 | ||
| EV/EBITDA | 12 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
WDC has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)589.96
PEG (5Y)0.97
EPS Next 2Y3.9%
EPS Next 3Y5.08%
5. Dividend
5.1 Amount
With a yearly dividend of 0.40%, WDC is not a good candidate for dividend investing.
WDC's Dividend Yield is a higher than the industry average which is at 1.85.
Compared to an average S&P500 Dividend Yield of 2.38, WDC's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.4% |
5.2 History
The dividend of WDC decreases each year by -42.40%.
WDC has been paying a dividend for at least 10 years, so it has a reliable track record.
Dividend Growth(5Y)-42.4%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
2.39% of the earnings are spent on dividend by WDC. This is a low number and sustainable payout ratio.
DP2.39%
EPS Next 2Y3.9%
EPS Next 3Y5.08%
106.63
+1.48 (+1.41%)
Chartmill FA Rating
GICS SectorInformation Technology
GICS IndustryGroupTechnology Hardware & Equipment
GICS IndustryTechnology Hardware, Storage & Peripherals
Earnings (Last)
Earnings (Next)
Inst Owners104.54%
Inst Owner Change1.5%
Ins Owners0.46%
Ins Owner Change7.08%
Market Cap36.99B
Analysts80
Price Target92.2 (-13.53%)
Short Float %10.2%
Short Ratio4.73
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 0.4% |
Yearly Dividend0.13
Dividend Growth(5Y)-42.4%
DP2.39%
Div Incr Years0
Div Non Decr Years0
Ex-Date
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)15.3%
Min EPS beat(2)10.76%
Max EPS beat(2)19.85%
EPS beat(4)3
Avg EPS beat(4)7.91%
Min EPS beat(4)-1.74%
Max EPS beat(4)19.85%
EPS beat(8)7
Avg EPS beat(8)37.78%
EPS beat(12)9
Avg EPS beat(12)2.7%
EPS beat(16)13
Avg EPS beat(16)3.31%
Revenue beat(2)1
Avg Revenue beat(2)0.52%
Min Revenue beat(2)-3.37%
Max Revenue beat(2)4.41%
Revenue beat(4)1
Avg Revenue beat(4)-0.25%
Min Revenue beat(4)-3.37%
Max Revenue beat(4)4.41%
Revenue beat(8)4
Avg Revenue beat(8)0.44%
Revenue beat(12)8
Avg Revenue beat(12)1.41%
Revenue beat(16)9
Avg Revenue beat(16)0.86%
PT rev (1m)9.73%
PT rev (3m)53.99%
EPS NQ rev (1m)0.17%
EPS NQ rev (3m)16.99%
EPS NY rev (1m)18.93%
EPS NY rev (3m)19.7%
Revenue NQ rev (1m)0.04%
Revenue NQ rev (3m)8.25%
Revenue NY rev (1m)7.42%
Revenue NY rev (3m)9.09%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 16.23 | ||
| Fwd PE | 16.23 | ||
| P/S | 2.79 | ||
| P/FCF | 28.92 | ||
| P/OCF | 21.88 | ||
| P/B | 6.68 | ||
| P/tB | 32.2 | ||
| EV/EBITDA | 12 |
EPS(TTM)6.57
EY6.16%
EPS(NY)6.57
Fwd EY6.16%
FCF(TTM)3.69
FCFY3.46%
OCF(TTM)4.87
OCFY4.57%
SpS38.28
BVpS15.97
TBVpS3.31
PEG (NY)589.96
PEG (5Y)0.97
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 13.16% | ||
| ROE | 33.25% | ||
| ROCE | 32.69% | ||
| ROIC | 25.82% | ||
| ROICexc | 34.26% | ||
| ROICexgc | 106.63% | ||
| OM | 21.13% | ||
| PM (TTM) | 13.87% | ||
| GM | 38% | ||
| FCFM | 9.63% |
ROA(3y)0.89%
ROA(5y)2.34%
ROE(3y)3.69%
ROE(5y)6.28%
ROIC(3y)N/A
ROIC(5y)N/A
ROICexc(3y)N/A
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)N/A
ROCE(5y)N/A
ROICexcg growth 3Y48.5%
ROICexcg growth 5Y76.15%
ROICexc growth 3Y32.58%
ROICexc growth 5Y68.99%
OM growth 3Y16.77%
OM growth 5Y53.81%
PM growth 3Y32.94%
PM growth 5YN/A
GM growth 3Y6.22%
GM growth 5Y11.02%
F-Score7
Asset Turnover0.95
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.45 | ||
| Debt/FCF | 3.68 | ||
| Debt/EBITDA | 0.76 | ||
| Cap/Depr | 91.35% | ||
| Cap/Sales | 3.1% | ||
| Interest Coverage | 7.65 | ||
| Cash Conversion | 51.92% | ||
| Profit Quality | 69.44% | ||
| Current Ratio | 1.08 | ||
| Quick Ratio | 0.84 | ||
| Altman-Z | 4.31 |
F-Score7
WACC8.21%
ROIC/WACC3.15
Cap/Depr(3y)92.08%
Cap/Depr(5y)98.32%
Cap/Sales(3y)8.39%
Cap/Sales(5y)7.58%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)1828.95%
EPS 3Y-7.2%
EPS 5Y16.66%
EPS Q2Q%15.28%
EPS Next Y0.03%
EPS Next 2Y3.9%
EPS Next 3Y5.08%
EPS Next 5Y10.07%
Revenue 1Y (TTM)-15.7%
Revenue growth 3Y-20.28%
Revenue growth 5Y-10.67%
Sales Q2Q%-30.79%
Revenue Next Year17.43%
Revenue Next 2Y11.12%
Revenue Next 3Y7.79%
Revenue Next 5Y7.74%
EBIT growth 1Y952.89%
EBIT growth 3Y-6.92%
EBIT growth 5Y37.4%
EBIT Next Year53.54%
EBIT Next 3Y17.97%
EBIT Next 5Y12.7%
FCF growth 1Y263.76%
FCF growth 3Y19.05%
FCF growth 5Y48.52%
OCF growth 1Y675.17%
OCF growth 3Y-3.47%
OCF growth 5Y15.46%