WENDY'S CO/THE (WEN) Stock Fundamental Analysis
NASDAQ:WEN - Nasdaq - US95058W1009 - Common Stock - Currency: USD
Taking everything into account, WEN scores 6 out of 10 in our fundamental rating. WEN was compared to 134 industry peers in the Hotels, Restaurants & Leisure industry. WEN scores excellent on profitability, but there are some minor concerns on its financial health. WEN is not valued too expensively and it also shows a decent growth rate.
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 better Return On Assets (3.82%) than 60.31% of its industry peers.
The Return On Equity of WEN (74.58%) is better than 97.71% of its industry peers.
WEN has a Return On Invested Capital of 5.61%. This is comparable to the rest of the industry: WEN outperforms 48.85% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for WEN is significantly below the industry average of 10.59%.
The 3 year average ROIC (5.24%) for WEN is below the current ROIC(5.61%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.82% | ||
| ROE | 74.58% | ||
| ROIC | 5.61% |
ROA(3y)3.7%
ROA(5y)3.24%
ROE(3y)50%
ROE(5y)39.59%
ROIC(3y)5.24%
ROIC(5y)4.91%
1.3 Margins
WEN has a Profit Margin of 8.76%. This is in the better half of the industry: WEN outperforms 70.99% of its industry peers.
In the last couple of years the Profit Margin of WEN has declined.
WEN has a Operating Margin of 16.31%. This is in the better half of the industry: WEN outperforms 68.70% of its industry peers.
WEN's Operating Margin has improved in the last couple of years.
The Gross Margin of WEN (63.04%) is better than 75.57% 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 | 16.31% | ||
| PM (TTM) | 8.76% | ||
| GM | 63.04% |
OM growth 3Y1.91%
OM growth 5Y1.57%
PM growth 3Y11.31%
PM growth 5Y-20.19%
GM growth 3Y-0.3%
GM growth 5Y-0.47%
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
WEN has less shares outstanding than it did 5 years ago.
The debt/assets ratio for WEN is higher compared to a year ago.
2.2 Solvency
WEN has an Altman-Z score of 1.26. This is a bad value and indicates that WEN is not financially healthy and even has some risk of bankruptcy.
WEN has a Altman-Z score (1.26) which is in line with its industry peers.
WEN has a debt to FCF ratio of 11.87. This is a negative value and a sign of low solvency as WEN would need 11.87 years to pay back of all of its debts.
With a Debt to FCF ratio value of 11.87, WEN perfoms like the industry average, outperforming 56.49% of the companies in the same industry.
WEN has a Debt/Equity ratio of 12.64. This is a high value indicating a heavy dependency on external financing.
WEN has a Debt to Equity ratio of 12.64. This is in the lower half of the industry: WEN underperforms 66.41% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 12.64 | ||
| Debt/FCF | 11.87 | ||
| Altman-Z | 1.26 |
ROIC/WACC0.79
WACC7.13%
2.3 Liquidity
A Current Ratio of 2.10 indicates that WEN has no problem at all paying its short term obligations.
The Current ratio of WEN (2.10) is better than 87.79% of its industry peers.
A Quick Ratio of 2.08 indicates that WEN has no problem at all paying its short term obligations.
WEN's Quick ratio of 2.08 is amongst the best of the industry. WEN outperforms 87.79% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.1 | ||
| Quick Ratio | 2.08 |
3. Growth
3.1 Past
WEN shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -2.04%.
WEN shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 10.83% yearly.
WEN shows a small growth in Revenue. In the last year, the Revenue has grown by 1.63%.
The Revenue has been growing slightly by 6.53% on average over the past years.
EPS 1Y (TTM)-2.04%
EPS 3Y19.39%
EPS 5Y10.83%
EPS Q2Q%-7.41%
Revenue 1Y (TTM)1.63%
Revenue growth 3Y7.96%
Revenue growth 5Y6.53%
Sales Q2Q%2.94%
3.2 Future
The Earnings Per Share is expected to grow by 10.54% on average over the next years. This is quite good.
WEN is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 3.31% yearly.
EPS Next Y3.67%
EPS Next 2Y4.03%
EPS Next 3Y7.18%
EPS Next 5Y10.54%
Revenue Next Year2.13%
Revenue Next 2Y2.06%
Revenue Next 3Y2.72%
Revenue Next 5Y3.31%
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 stable.
The Revenue growth rate is decreasing: in the next years the growth will be less than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
WEN is valuated correctly with a Price/Earnings ratio of 15.71.
Compared to the rest of the industry, the Price/Earnings ratio of WEN indicates a rather cheap valuation: WEN is cheaper than 80.92% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 28.47. WEN is valued slightly cheaper when compared to this.
WEN is valuated correctly with a Price/Forward Earnings ratio of 14.36.
Compared to the rest of the industry, the Price/Forward Earnings ratio of WEN indicates a rather cheap valuation: WEN is cheaper than 83.97% of the companies listed in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 92.74. WEN is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.71 | ||
| Fwd PE | 14.36 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of WEN is on the same level as its industry peers.
Based on the Price/Free Cash Flow ratio, WEN is valued cheaply inside the industry as 93.13% of the companies are valued more expensively.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 10.94 | ||
| EV/EBITDA | 11.37 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates WEN does not grow enough to justify the current Price/Earnings ratio.
WEN has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)4.28
PEG (5Y)1.45
EPS Next 2Y4.03%
EPS Next 3Y7.18%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 6.72%, WEN is a good candidate for dividend investing.
The stock price of WEN dropped by -22.82% 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 3.09. WEN pays more dividend than 96.95% of the companies in the same industry.
WEN's Dividend Yield is rather good when compared to the S&P500 average which is at 2.28.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.72% |
5.2 History
On average, the dividend of WEN grows each year by 20.25%, which is quite nice.
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)20.25%
Div Incr Years3
Div Non Decr Years4
5.3 Sustainability
105.67% 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.
DP105.67%
EPS Next 2Y4.03%
EPS Next 3Y7.18%
WENDY'S CO/THE
NASDAQ:WEN (2/4/2025, 8:15:51 PM)
After market: 15.1 +0.02 (+0.13%)15.08
+0.05 (+0.33%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners79.55%
Inst Owner Change-1.92%
Ins Owners8.43%
Ins Owner Change0%
Market Cap3.07B
Analysts68
Price Target19.31 (28.05%)
Short Float %5.21%
Short Ratio2.49
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.72% |
Yearly Dividend0.5
Dividend Growth(5Y)20.25%
DP105.67%
Div Incr Years3
Div Non Decr Years4
Ex-DateN/A
Surprises & Revisions
EPS beat(2)0
Avg EPS beat(2)-2.52%
Min EPS beat(2)-3.06%
Max EPS beat(2)-1.97%
EPS beat(4)1
Avg EPS beat(4)-2.08%
Min EPS beat(4)-10.69%
Max EPS beat(4)7.4%
EPS beat(8)5
Avg EPS beat(8)1.09%
EPS beat(12)8
Avg EPS beat(12)1.34%
EPS beat(16)11
Avg EPS beat(16)6.26%
Revenue beat(2)1
Avg Revenue beat(2)-1%
Min Revenue beat(2)-2.13%
Max Revenue beat(2)0.13%
Revenue beat(4)1
Avg Revenue beat(4)-1.55%
Min Revenue beat(4)-2.13%
Max Revenue beat(4)0.13%
Revenue beat(8)2
Avg Revenue beat(8)-1.3%
Revenue beat(12)3
Avg Revenue beat(12)-1.23%
Revenue beat(16)5
Avg Revenue beat(16)-0.56%
PT rev (1m)-6.68%
PT rev (3m)-2.84%
EPS NQ rev (1m)-0.18%
EPS NQ rev (3m)8.32%
EPS NY rev (1m)0.04%
EPS NY rev (3m)0.65%
Revenue NQ rev (1m)0.19%
Revenue NQ rev (3m)0.36%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.67%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 15.71 | ||
| Fwd PE | 14.36 | ||
| P/S | 1.39 | ||
| P/FCF | 10.94 | ||
| P/OCF | 8.48 | ||
| P/B | 11.83 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.37 |
EPS(TTM)0.96
EY6.37%
EPS(NY)1.05
Fwd EY6.96%
FCF(TTM)1.38
FCFY9.14%
OCF(TTM)1.78
OCFY11.79%
SpS10.86
BVpS1.27
TBVpS-8.4
PEG (NY)4.28
PEG (5Y)1.45
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.82% | ||
| ROE | 74.58% | ||
| ROCE | 7.68% | ||
| ROIC | 5.61% | ||
| ROICexc | 6.25% | ||
| ROICexgc | 11.74% | ||
| OM | 16.31% | ||
| PM (TTM) | 8.76% | ||
| GM | 63.04% | ||
| FCFM | 12.69% |
ROA(3y)3.7%
ROA(5y)3.24%
ROE(3y)50%
ROE(5y)39.59%
ROIC(3y)5.24%
ROIC(5y)4.91%
ROICexc(3y)5.83%
ROICexc(5y)5.39%
ROICexgc(3y)10.89%
ROICexgc(5y)10.03%
ROCE(3y)7.17%
ROCE(5y)6.72%
ROICexcg growth 3Y10.85%
ROICexcg growth 5Y-0.14%
ROICexc growth 3Y10.32%
ROICexc growth 5Y4.36%
OM growth 3Y1.91%
OM growth 5Y1.57%
PM growth 3Y11.31%
PM growth 5Y-20.19%
GM growth 3Y-0.3%
GM growth 5Y-0.47%
F-Score7
Asset Turnover0.44
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 12.64 | ||
| Debt/FCF | 11.87 | ||
| Debt/EBITDA | 6.3 | ||
| Cap/Depr | 50.98% | ||
| Cap/Sales | 3.69% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 69.56% | ||
| Profit Quality | 144.93% | ||
| Current Ratio | 2.1 | ||
| Quick Ratio | 2.08 | ||
| Altman-Z | 1.26 |
F-Score7
WACC7.13%
ROIC/WACC0.79
Cap/Depr(3y)60.78%
Cap/Depr(5y)58.17%
Cap/Sales(3y)4.03%
Cap/Sales(5y)4.09%
Profit Quality(3y)119.77%
Profit Quality(5y)139.75%
High Growth Momentum
Growth
EPS 1Y (TTM)-2.04%
EPS 3Y19.39%
EPS 5Y10.83%
EPS Q2Q%-7.41%
EPS Next Y3.67%
EPS Next 2Y4.03%
EPS Next 3Y7.18%
EPS Next 5Y10.54%
Revenue 1Y (TTM)1.63%
Revenue growth 3Y7.96%
Revenue growth 5Y6.53%
Sales Q2Q%2.94%
Revenue Next Year2.13%
Revenue Next 2Y2.06%
Revenue Next 3Y2.72%
Revenue Next 5Y3.31%
EBIT growth 1Y-5.81%
EBIT growth 3Y10.03%
EBIT growth 5Y8.21%
EBIT Next Year38%
EBIT Next 3Y14.58%
EBIT Next 5Y10.53%
FCF growth 1Y68.07%
FCF growth 3Y6.53%
FCF growth 5Y11.03%
OCF growth 1Y44.03%
OCF growth 3Y6.69%
OCF growth 5Y9.03%