WENDY'S CO/THE (WEN) Stock Fundamental Analysis
USA - NASDAQ:WEN - US95058W1009 - Common Stock
8.23 USD
-0.17 (-2.02%)
8.26 USD
+0.03 (+0.36%)
WEN gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 132 industry peers in the Hotels, Restaurants & Leisure industry. While WEN belongs to the best of the industry regarding profitability, there are concerns on its financial health. WEN has a bad growth rate and is valued cheaply.
1. Profitability
1.1 Basic Checks
WEN had positive earnings in the past year.
WEN had a positive operating cash flow in the past year.
Each year in the past 5 years WEN has been profitable.
Each year in the past 5 years WEN had a positive operating cash flow.
1.2 Ratios
With a Return On Assets value of 3.92%, WEN perfoms like the industry average, outperforming 58.33% of the companies in the same industry.
WEN has a better Return On Equity (170.14%) than 97.73% of its industry peers.
Looking at the Return On Invested Capital, with a value of 6.16%, WEN is in line with its industry, outperforming 56.06% of the companies in the same industry.
WEN had an Average Return On Invested Capital over the past 3 years of 5.43%. This is significantly below the industry average of 10.59%.
The last Return On Invested Capital (6.16%) for WEN is above the 3 year average (5.43%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.92% | ||
| ROE | 170.14% | ||
| ROIC | 6.16% |
ROA(3y)3.68%
ROA(5y)3.46%
ROE(3y)59.67%
ROE(5y)49.27%
ROIC(3y)5.43%
ROIC(5y)5.17%
1.3 Margins
With a decent Profit Margin value of 8.63%, WEN is doing good in the industry, outperforming 68.94% of the companies in the same industry.
WEN's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 17.15%, WEN is in the better half of the industry, outperforming 74.24% of the companies in the same industry.
In the last couple of years the Operating Margin of WEN has remained more or less at the same level.
WEN has a Gross Margin of 63.17%. This is in the better half of the industry: WEN outperforms 77.27% of its industry peers.
In the last couple of years the Gross Margin of WEN has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.15% | ||
| PM (TTM) | 8.63% | ||
| GM | 63.17% |
OM growth 3Y-1.47%
OM growth 5Y0.74%
PM growth 3Y-6.44%
PM growth 5Y1.55%
GM growth 3Y-1.04%
GM growth 5Y0.27%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), WEN is destroying value.
Compared to 1 year ago, WEN has less shares outstanding
The number of shares outstanding for WEN has been reduced compared to 5 years ago.
Compared to 1 year ago, WEN has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.07, we must say that WEN is in the distress zone and has some risk of bankruptcy.
WEN has a worse Altman-Z score (1.07) than 62.12% of its industry peers.
The Debt to FCF ratio of WEN is 13.03, which is on the high side as it means it would take WEN, 13.03 years of fcf income to pay off all of its debts.
With a Debt to FCF ratio value of 13.03, WEN perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
A Debt/Equity ratio of 28.74 is on the high side and indicates that WEN has dependencies on debt financing.
The Debt to Equity ratio of WEN (28.74) is worse than 69.70% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 28.74 | ||
| Debt/FCF | 13.03 | ||
| Altman-Z | 1.07 |
ROIC/WACC0.94
WACC6.54%
2.3 Liquidity
A Current Ratio of 1.45 indicates that WEN should not have too much problems paying its short term obligations.
WEN has a Current ratio of 1.45. This is in the better half of the industry: WEN outperforms 71.21% of its industry peers.
WEN has a Quick Ratio of 1.43. This is a normal value and indicates that WEN is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Quick ratio, with a value of 1.43, WEN is in the better half of the industry, outperforming 74.24% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.45 | ||
| Quick Ratio | 1.43 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 2.08% over the past year.
Measured over the past years, WEN shows a quite strong growth in Earnings Per Share. The EPS has been growing by 11.13% on average per year.
WEN shows a decrease in Revenue. In the last year, the revenue decreased by -0.21%.
The Revenue has been growing slightly by 5.62% on average over the past years.
EPS 1Y (TTM)2.08%
EPS 3Y6.84%
EPS 5Y11.13%
EPS Q2Q%-4%
Revenue 1Y (TTM)-0.21%
Revenue growth 3Y5.8%
Revenue growth 5Y5.62%
Sales Q2Q%-3.04%
3.2 Future
WEN is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.02% yearly.
The Revenue is expected to grow by 2.17% on average over the next years.
EPS Next Y-13.58%
EPS Next 2Y-3.3%
EPS Next 3Y1.43%
EPS Next 5Y7.02%
Revenue Next Year-4.04%
Revenue Next 2Y-0.58%
Revenue Next 3Y0.44%
Revenue Next 5Y2.17%
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
WEN is valuated reasonably with a Price/Earnings ratio of 8.40.
Based on the Price/Earnings ratio, WEN is valued cheaper than 93.18% of the companies in the same industry.
WEN is valuated cheaply when we compare the Price/Earnings ratio to 25.51, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 8.80 indicates a reasonable valuation of WEN.
Based on the Price/Forward Earnings ratio, WEN is valued cheaper than 89.39% of the companies in the same industry.
Compared to an average S&P500 Price/Forward Earnings ratio of 34.98, WEN is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.4 | ||
| Fwd PE | 8.8 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of WEN indicates a somewhat cheap valuation: WEN is cheaper than 69.70% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, WEN is valued cheaper than 96.21% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 6.11 | ||
| EV/EBITDA | 8.56 |
4.3 Compensation for Growth
The decent profitability rating of WEN may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.75
EPS Next 2Y-3.3%
EPS Next 3Y1.43%
5. Dividend
5.1 Amount
WEN has a Yearly Dividend Yield of 6.56%, which is a nice return.
The stock price of WEN dropped by -22.65% in the last 3 months. With lower prices the dividend yield is higher, but it may be a sign investors do not trust the long term dividend.
Compared to an average industry Dividend Yield of 4.58, WEN pays a better dividend. On top of this WEN pays more dividend than 96.21% of the companies listed in the same industry.
WEN's Dividend Yield is rather good when compared to the S&P500 average which is at 2.44.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.56% |
5.2 History
On average, the dividend of WEN grows each year by 32.37%, which is quite nice.
WEN has been paying a dividend for at least 10 years, so it has a reliable track record.
WEN has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)32.37%
Div Incr Years0
Div Non Decr Years4
5.3 Sustainability
92.71% of the earnings are spent on dividend by WEN. This is not a sustainable payout ratio.
WEN's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP92.71%
EPS Next 2Y-3.3%
EPS Next 3Y1.43%
8.23
-0.17 (-2.02%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners98.47%
Inst Owner Change-7.32%
Ins Owners8.86%
Ins Owner Change0.69%
Market Cap1.57B
Revenue(TTM)2.21B
Net Income(TTM)192.06M
Analysts56.76
Price Target11.01 (33.78%)
Short Float %17.3%
Short Ratio4.17
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.56% |
Yearly Dividend1
Dividend Growth(5Y)32.37%
DP92.71%
Div Incr Years0
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)6.16%
Min EPS beat(2)-0.22%
Max EPS beat(2)12.55%
EPS beat(4)2
Avg EPS beat(4)3.16%
Min EPS beat(4)-1.97%
Max EPS beat(4)12.55%
EPS beat(8)4
Avg EPS beat(8)1.42%
EPS beat(12)8
Avg EPS beat(12)2.26%
EPS beat(16)11
Avg EPS beat(16)2.12%
Revenue beat(2)0
Avg Revenue beat(2)-0.96%
Min Revenue beat(2)-1.35%
Max Revenue beat(2)-0.56%
Revenue beat(4)2
Avg Revenue beat(4)-0.23%
Min Revenue beat(4)-1.35%
Max Revenue beat(4)0.88%
Revenue beat(8)2
Avg Revenue beat(8)-1.14%
Revenue beat(12)3
Avg Revenue beat(12)-1.13%
Revenue beat(16)4
Avg Revenue beat(16)-1.05%
PT rev (1m)-3.32%
PT rev (3m)-17.43%
EPS NQ rev (1m)-0.32%
EPS NQ rev (3m)-4.5%
EPS NY rev (1m)-0.76%
EPS NY rev (3m)-10.07%
Revenue NQ rev (1m)-0.08%
Revenue NQ rev (3m)-1.07%
Revenue NY rev (1m)-0.09%
Revenue NY rev (3m)-2.39%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.4 | ||
| Fwd PE | 8.8 | ||
| P/S | 0.7 | ||
| P/FCF | 6.11 | ||
| P/OCF | 4.41 | ||
| P/B | 13.89 | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.56 |
EPS(TTM)0.98
EY11.91%
EPS(NY)0.94
Fwd EY11.36%
FCF(TTM)1.35
FCFY16.38%
OCF(TTM)1.87
OCFY22.69%
SpS11.68
BVpS0.59
TBVpS-9.63
PEG (NY)N/A
PEG (5Y)0.75
Graham Number3.61
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.92% | ||
| ROE | 170.14% | ||
| ROCE | 8.52% | ||
| ROIC | 6.16% | ||
| ROICexc | 6.57% | ||
| ROICexgc | 12.26% | ||
| OM | 17.15% | ||
| PM (TTM) | 8.63% | ||
| GM | 63.17% | ||
| FCFM | 11.54% |
ROA(3y)3.68%
ROA(5y)3.46%
ROE(3y)59.67%
ROE(5y)49.27%
ROIC(3y)5.43%
ROIC(5y)5.17%
ROICexc(3y)6.13%
ROICexc(5y)5.72%
ROICexgc(3y)11.48%
ROICexgc(5y)10.67%
ROCE(3y)7.51%
ROCE(5y)7.16%
ROICexgc growth 3Y6.48%
ROICexgc growth 5Y7.52%
ROICexc growth 3Y6.19%
ROICexc growth 5Y7.2%
OM growth 3Y-1.47%
OM growth 5Y0.74%
PM growth 3Y-6.44%
PM growth 5Y1.55%
GM growth 3Y-1.04%
GM growth 5Y0.27%
F-Score6
Asset Turnover0.45
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 28.74 | ||
| Debt/FCF | 13.03 | ||
| Debt/EBITDA | 5.99 | ||
| Cap/Depr | 62% | ||
| Cap/Sales | 4.45% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 65.75% | ||
| Profit Quality | 133.75% | ||
| Current Ratio | 1.45 | ||
| Quick Ratio | 1.43 | ||
| Altman-Z | 1.07 |
F-Score6
WACC6.54%
ROIC/WACC0.94
Cap/Depr(3y)59.99%
Cap/Depr(5y)58.81%
Cap/Sales(3y)4.06%
Cap/Sales(5y)4.05%
Profit Quality(3y)119.97%
Profit Quality(5y)135.28%
High Growth Momentum
Growth
EPS 1Y (TTM)2.08%
EPS 3Y6.84%
EPS 5Y11.13%
EPS Q2Q%-4%
EPS Next Y-13.58%
EPS Next 2Y-3.3%
EPS Next 3Y1.43%
EPS Next 5Y7.02%
Revenue 1Y (TTM)-0.21%
Revenue growth 3Y5.8%
Revenue growth 5Y5.62%
Sales Q2Q%-3.04%
Revenue Next Year-4.04%
Revenue Next 2Y-0.58%
Revenue Next 3Y0.44%
Revenue Next 5Y2.17%
EBIT growth 1Y2.22%
EBIT growth 3Y4.25%
EBIT growth 5Y6.41%
EBIT Next Year37.36%
EBIT Next 3Y13.87%
EBIT Next 5Y10.86%
FCF growth 1Y17.59%
FCF growth 3Y-0.86%
FCF growth 5Y4.01%
OCF growth 1Y17.36%
OCF growth 3Y0.91%
OCF growth 5Y4.22%
WENDY'S CO/THE / WEN FAQ
What is the fundamental rating for WEN stock?
ChartMill assigns a fundamental rating of 5 / 10 to WEN.
What is the valuation status of WENDY'S CO/THE (WEN) stock?
ChartMill assigns a valuation rating of 7 / 10 to WENDY'S CO/THE (WEN). This can be considered as Undervalued.
Can you provide the profitability details for WENDY'S CO/THE?
WENDY'S CO/THE (WEN) has a profitability rating of 7 / 10.
What is the valuation of WENDY'S CO/THE based on its PE and PB ratios?
The Price/Earnings (PE) ratio for WENDY'S CO/THE (WEN) is 8.4 and the Price/Book (PB) ratio is 13.89.
Can you provide the financial health for WEN stock?
The financial health rating of WENDY'S CO/THE (WEN) is 3 / 10.