WENDY'S CO/THE (WEN) Stock Fundamental Analysis
USA - NASDAQ:WEN - US95058W1009 - Common Stock
9.47 USD
-0.09 (-0.94%)
9.55 USD
+0.08 (+0.84%)
Overall WEN gets a fundamental rating of 5 out of 10. We evaluated WEN against 133 industry peers in the Hotels, Restaurants & Leisure industry. While WEN has a great profitability rating, there are quite some 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.
In the past 5 years WEN has always been profitable.
Each year in the past 5 years WEN had a positive operating cash flow.
1.2 Ratios
WEN has a Return On Assets (3.92%) which is in line with its industry peers.
The Return On Equity of WEN (170.14%) is better than 99.25% of its industry peers.
WEN's Return On Invested Capital of 6.16% is in line compared to the rest of the industry. WEN outperforms 55.64% of its industry peers.
The Average Return On Invested Capital over the past 3 years for WEN is significantly below the industry average of 15.68%.
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
WEN has a better Profit Margin (8.63%) than 69.17% of its industry peers.
In the last couple of years the Profit Margin of WEN has grown nicely.
The Operating Margin of WEN (17.15%) is better than 74.44% of its industry peers.
In the last couple of years the Operating Margin of WEN has remained more or less at the same level.
With a decent Gross Margin value of 63.17%, WEN is doing good in the industry, outperforming 75.94% of the companies in the same industry.
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
Compared to 5 years ago, WEN has less shares outstanding
Compared to 1 year ago, WEN has a worse debt to assets ratio.
2.2 Solvency
WEN has an Altman-Z score of 1.10. This is a bad value and indicates that WEN is not financially healthy and even has some risk of bankruptcy.
WEN has a worse Altman-Z score (1.10) than 66.17% 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.
WEN's Debt to FCF ratio of 13.03 is in line compared to the rest of the industry. WEN outperforms 52.63% of its industry peers.
WEN has a Debt/Equity ratio of 28.74. This is a high value indicating a heavy dependency on external financing.
WEN has a worse Debt to Equity ratio (28.74) than 69.17% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 28.74 | ||
| Debt/FCF | 13.03 | ||
| Altman-Z | 1.1 |
ROIC/WACC0.83
WACC7.41%
2.3 Liquidity
WEN has a Current Ratio of 1.45. 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 Current ratio, with a value of 1.45, WEN is in the better half of the industry, outperforming 71.43% of the companies in the same industry.
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.
WEN has a better Quick ratio (1.43) than 74.44% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.45 | ||
| Quick Ratio | 1.43 |
3. Growth
3.1 Past
WEN shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 1.02%.
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.
The Revenue has been growing slightly by 1.31% in the past year.
The Revenue has been growing slightly by 5.62% on average over the past years.
EPS 1Y (TTM)1.02%
EPS 3Y6.84%
EPS 5Y11.13%
EPS Q2Q%7.41%
Revenue 1Y (TTM)1.31%
Revenue growth 3Y5.8%
Revenue growth 5Y5.62%
Sales Q2Q%-1.72%
3.2 Future
The Earnings Per Share is expected to grow by 7.17% on average over the next years.
Based on estimates for the next years, WEN will show a small growth in Revenue. The Revenue will grow by 2.19% on average per year.
EPS Next Y-12.36%
EPS Next 2Y-2.32%
EPS Next 3Y1.81%
EPS Next 5Y7.17%
Revenue Next Year-3.73%
Revenue Next 2Y-0.31%
Revenue Next 3Y0.5%
Revenue Next 5Y2.19%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less 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
WEN is valuated reasonably with a Price/Earnings ratio of 9.57.
Based on the Price/Earnings ratio, WEN is valued cheaply inside the industry as 93.98% of the companies are valued more expensively.
WEN is valuated cheaply when we compare the Price/Earnings ratio to 27.20, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 9.93 indicates a reasonable valuation of WEN.
Based on the Price/Forward Earnings ratio, WEN is valued cheaply inside the industry as 89.47% of the companies are valued more expensively.
WEN is valuated cheaply when we compare the Price/Forward Earnings ratio to 22.70, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.57 | ||
| Fwd PE | 9.93 |
4.2 Price Multiples
74.44% of the companies in the same industry are more expensive than WEN, based on the Enterprise Value to EBITDA ratio.
Based on the Price/Free Cash Flow ratio, WEN is valued cheaply inside the industry as 96.24% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 7.03 | ||
| EV/EBITDA | 9 |
4.3 Compensation for Growth
WEN has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.86
EPS Next 2Y-2.32%
EPS Next 3Y1.81%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.51%, WEN is a good candidate for dividend investing.
In the last 3 months the price of WEN has falen by -21.15%. A price decline artificially increases the dividend yield. It may be a sign investors do not expect the dividend to last.
Compared to an average industry Dividend Yield of 3.93, WEN pays a better dividend. On top of this WEN pays more dividend than 94.74% 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 2.38.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.51% |
5.2 History
The dividend of WEN is nicely growing with an annual growth rate of 32.37%!
WEN has paid a dividend for at least 10 years, which is 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
WEN pays out 92.71% of its income as dividend. 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-2.32%
EPS Next 3Y1.81%
9.47
-0.09 (-0.94%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners91.75%
Inst Owner Change2.3%
Ins Owners8.78%
Ins Owner Change0.53%
Market Cap1.80B
Analysts65.45
Price Target11.65 (23.02%)
Short Float %12.14%
Short Ratio2.97
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.51% |
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)-12.62%
PT rev (3m)-21%
EPS NQ rev (1m)-3.41%
EPS NQ rev (3m)-20.81%
EPS NY rev (1m)-8.8%
EPS NY rev (3m)-9.13%
Revenue NQ rev (1m)-0.6%
Revenue NQ rev (3m)-4%
Revenue NY rev (1m)-2.07%
Revenue NY rev (3m)-2.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.57 | ||
| Fwd PE | 9.93 | ||
| P/S | 0.81 | ||
| P/FCF | 7.03 | ||
| P/OCF | 5.07 | ||
| P/B | 15.99 | ||
| P/tB | N/A | ||
| EV/EBITDA | 9 |
EPS(TTM)0.99
EY10.45%
EPS(NY)0.95
Fwd EY10.07%
FCF(TTM)1.35
FCFY14.23%
OCF(TTM)1.87
OCFY19.72%
SpS11.68
BVpS0.59
TBVpS-9.63
PEG (NY)N/A
PEG (5Y)0.86
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%
ROICexcg growth 3Y6.48%
ROICexcg 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 | 1.1 |
F-Score6
WACC7.41%
ROIC/WACC0.83
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)1.02%
EPS 3Y6.84%
EPS 5Y11.13%
EPS Q2Q%7.41%
EPS Next Y-12.36%
EPS Next 2Y-2.32%
EPS Next 3Y1.81%
EPS Next 5Y7.17%
Revenue 1Y (TTM)1.31%
Revenue growth 3Y5.8%
Revenue growth 5Y5.62%
Sales Q2Q%-1.72%
Revenue Next Year-3.73%
Revenue Next 2Y-0.31%
Revenue Next 3Y0.5%
Revenue Next 5Y2.19%
EBIT growth 1Y2.22%
EBIT growth 3Y4.25%
EBIT growth 5Y6.41%
EBIT Next Year42.36%
EBIT Next 3Y15.24%
EBIT Next 5Y10.94%
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%