WENDY'S CO/THE (WEN) Stock Fundamental Analysis
USA - NASDAQ:WEN - US95058W1009 - Common Stock
7.87 USD
-0.25 (-3.08%)
7.88 USD
+0.01 (+0.13%)
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 has a great profitability rating, there are quite some concerns on its financial health. WEN is valued quite cheap, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
In the past year WEN was profitable.
In the past year WEN had a positive cash flow from operations.
WEN had positive earnings in each of the past 5 years.
WEN had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
WEN has a Return On Assets (3.92%) which is in line with its industry peers.
WEN's Return On Equity of 170.14% is amongst the best of the industry. WEN outperforms 98.48% of its industry peers.
The Return On Invested Capital of WEN (6.16%) is comparable to the rest of the 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 10.61%.
The 3 year average ROIC (5.43%) for WEN is below the current ROIC(6.16%), indicating increased profibility in the last year.
| 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
Looking at the Profit Margin, with a value of 8.63%, WEN is in the better half of the industry, outperforming 68.94% of the companies in the same industry.
WEN's Profit Margin has improved in the last couple of years.
WEN's Operating Margin of 17.15% is fine compared to the rest of the industry. WEN outperforms 74.24% of its industry peers.
WEN's Operating Margin has been stable in the last couple of years.
The Gross Margin of WEN (63.17%) is better than 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
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so WEN is destroying value.
The number of shares outstanding for WEN has been reduced compared to 1 year ago.
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 1.07. This is a bad value and indicates that WEN is not financially healthy and even has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.07, WEN is doing worse than 62.12% of the companies in the same industry.
WEN has a debt to FCF ratio of 13.03. This is a negative value and a sign of low solvency as WEN would need 13.03 years to pay back of all of its debts.
WEN has a Debt to FCF ratio of 13.03. This is comparable to the rest of the industry: WEN outperforms 50.00% 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.
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
WACC6.52%
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.
The Current ratio of WEN (1.45) is better than 71.21% of its industry peers.
A Quick Ratio of 1.43 indicates that WEN should not have too much problems paying its short term obligations.
WEN has a Quick ratio of 1.43. This is in the better half of the industry: WEN outperforms 74.24% 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 2.08%.
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 decreased by -0.21% in the past year.
Measured over the past years, WEN shows a small growth in Revenue. The Revenue has been growing by 5.62% on average per year.
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.
Based on estimates for the next years, WEN will show a small growth in Revenue. The Revenue will grow by 2.17% on average per year.
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
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
The Price/Earnings ratio is 8.03, which indicates a very decent valuation of WEN.
Compared to the rest of the industry, the Price/Earnings ratio of WEN indicates a rather cheap valuation: WEN is cheaper than 93.18% of the companies listed in the same industry.
WEN is valuated cheaply when we compare the Price/Earnings ratio to 25.07, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 8.42 indicates a reasonable valuation of WEN.
Compared to the rest of the industry, the Price/Forward Earnings ratio of WEN indicates a rather cheap valuation: WEN is cheaper than 90.15% of the companies listed in the same industry.
WEN's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 34.08.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.03 | ||
| Fwd PE | 8.42 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, WEN is valued a bit cheaper than the industry average as 71.21% of the companies are valued more expensively.
96.97% of the companies in the same industry are more expensive than WEN, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 5.84 | ||
| EV/EBITDA | 8.44 |
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)0.72
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 -26.03% 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.
WEN's Dividend Yield is rather good when compared to the industry average which is at 4.59. WEN pays more dividend than 96.21% of the companies 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
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-3.3%
EPS Next 3Y1.43%
7.87
-0.25 (-3.08%)
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 Cap1.50B
Revenue(TTM)2.21B
Net Income(TTM)192.06M
Analysts56.76
Price Target11.01 (39.9%)
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 | 8.03 | ||
| Fwd PE | 8.42 | ||
| P/S | 0.67 | ||
| P/FCF | 5.84 | ||
| P/OCF | 4.21 | ||
| P/B | 13.29 | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.44 |
EPS(TTM)0.98
EY12.45%
EPS(NY)0.94
Fwd EY11.88%
FCF(TTM)1.35
FCFY17.13%
OCF(TTM)1.87
OCFY23.73%
SpS11.68
BVpS0.59
TBVpS-9.63
PEG (NY)N/A
PEG (5Y)0.72
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
WACC6.52%
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 8.03 and the Price/Book (PB) ratio is 13.29.
Can you provide the financial health for WEN stock?
The financial health rating of WENDY'S CO/THE (WEN) is 3 / 10.