WENDY'S CO/THE (WEN)
US95058W1009 - Common Stock
WEN gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 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
In the past year WEN was profitable.
WEN had a positive operating cash flow in the past year.
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 better Return On Assets (3.82%) than 61.19% of its industry peers.
With an excellent Return On Equity value of 74.58%, WEN belongs to the best of the industry, outperforming 97.76% of the companies in the same industry.
With a Return On Invested Capital value of 5.61%, WEN perfoms like the industry average, outperforming 50.00% of the companies in the same industry.
WEN had an Average Return On Invested Capital over the past 3 years of 5.24%. This is significantly below the industry average of 10.50%.
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
Looking at the Profit Margin, with a value of 8.76%, WEN is in the better half of the industry, outperforming 71.64% of the companies in the same industry.
In the last couple of years the Profit Margin of WEN has declined.
WEN has a better Operating Margin (16.31%) than 70.90% of its industry peers.
In the last couple of years the Operating Margin of WEN has grown nicely.
The Gross Margin of WEN (63.04%) is better than 75.37% of its industry peers.
WEN's Gross Margin has been stable in the last couple of years.
| 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
Compared to 5 years ago, WEN has less shares outstanding
The debt/assets ratio for WEN is higher compared to a year ago.
2.2 Solvency
WEN has an Altman-Z score of 1.30. This is a bad value and indicates that WEN is not financially healthy and even has some risk of bankruptcy.
With a Altman-Z score value of 1.30, WEN perfoms like the industry average, outperforming 44.03% of the companies in the same industry.
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.
WEN's Debt to FCF ratio of 11.87 is in line compared to the rest of the industry. WEN outperforms 57.46% of its industry peers.
WEN has a Debt/Equity ratio of 12.64. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 12.64, WEN is doing worse than 65.67% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 12.64 | ||
| Debt/FCF | 11.87 | ||
| Altman-Z | 1.3 |
ROIC/WACC0.8
WACC7%
2.3 Liquidity
WEN has a Current Ratio of 2.10. This indicates that WEN is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of WEN (2.10) is better than 88.06% of its industry peers.
A Quick Ratio of 2.08 indicates that WEN has no problem at all paying its short term obligations.
The Quick ratio of WEN (2.08) is better than 88.81% 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.
Looking at the last year, WEN shows a small growth in Revenue. The Revenue has grown by 1.63% in the last year.
Measured over the past years, WEN shows a small growth in Revenue. The Revenue has been growing by 6.53% on average per year.
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
Based on estimates for the next years, WEN will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.50% on average per year.
The Revenue is expected to grow by 3.95% on average over the next years.
EPS Next Y3.63%
EPS Next 2Y4.33%
EPS Next 3Y7.63%
EPS Next 5Y11.5%
Revenue Next Year2.13%
Revenue Next 2Y2.08%
Revenue Next 3Y2.74%
Revenue Next 5Y3.95%
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 rather expensively with a Price/Earnings ratio of 17.34.
Compared to the rest of the industry, the Price/Earnings ratio of WEN indicates a somewhat cheap valuation: WEN is cheaper than 76.87% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 27.73. WEN is valued slightly cheaper when compared to this.
WEN is valuated correctly with a Price/Forward Earnings ratio of 15.77.
Based on the Price/Forward Earnings ratio, WEN is valued a bit cheaper than the industry average as 76.12% of the companies are valued more expensively.
WEN is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.83, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.34 | ||
| Fwd PE | 15.77 |
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.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of WEN indicates a rather cheap valuation: WEN is cheaper than 91.04% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.08 | ||
| EV/EBITDA | 11.98 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
WEN has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)4.78
PEG (5Y)1.6
EPS Next 2Y4.33%
EPS Next 3Y7.63%
5. Dividend
5.1 Amount
WEN has a Yearly Dividend Yield of 6.04%, which is a nice return.
Compared to an average industry Dividend Yield of 2.89, WEN pays a better dividend. On top of this WEN pays more dividend than 94.78% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.34, WEN pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.04% |
5.2 History
On average, the dividend of WEN grows each year by 20.25%, 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)20.25%
Div Incr Years3
Div Non Decr Years4
5.3 Sustainability
WEN pays out 105.67% 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.
DP105.67%
EPS Next 2Y4.33%
EPS Next 3Y7.63%
WENDY'S CO/THE
NASDAQ:WEN (12/20/2024, 8:00:01 PM)
After market: 16.56 -0.09 (-0.54%)16.65
+0.08 (+0.48%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners79.55%
Inst Owner Change2.45%
Ins Owners8.43%
Ins Owner Change0.01%
Market Cap3.39B
Analysts68
Price Target20.56 (23.48%)
Short Float %7.12%
Short Ratio3.32
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.04% |
Dividend Growth(5Y)20.25%
DP105.67%
Div Incr Years3
Div Non Decr Years4
Ex-Date
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)3.44%
PT rev (3m)3.04%
EPS NQ rev (1m)0%
EPS NQ rev (3m)8.51%
EPS NY rev (1m)-0.09%
EPS NY rev (3m)0.66%
Revenue NQ rev (1m)0%
Revenue NQ rev (3m)0.18%
Revenue NY rev (1m)0%
Revenue NY rev (3m)0.67%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.34 | ||
| Fwd PE | 15.77 | ||
| P/S | 1.53 | ||
| P/FCF | 12.08 | ||
| P/OCF | 9.36 | ||
| P/B | 13.06 | ||
| P/tB | N/A | ||
| EV/EBITDA | 11.98 |
EPS(TTM)0.96
EY5.77%
EPS(NY)1.06
Fwd EY6.34%
FCF(TTM)1.38
FCFY8.28%
OCF(TTM)1.78
OCFY10.68%
SpS10.86
BVpS1.27
TBVpS-8.4
PEG (NY)4.78
PEG (5Y)1.6
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 | 1.3 |
F-Score7
WACC7%
ROIC/WACC0.8
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 Y3.63%
EPS Next 2Y4.33%
EPS Next 3Y7.63%
EPS Next 5Y11.5%
Revenue 1Y (TTM)1.63%
Revenue growth 3Y7.96%
Revenue growth 5Y6.53%
Sales Q2Q%2.94%
Revenue Next Year2.13%
Revenue Next 2Y2.08%
Revenue Next 3Y2.74%
Revenue Next 5Y3.95%
EBIT growth 1Y-5.81%
EBIT growth 3Y10.03%
EBIT growth 5Y8.21%
EBIT Next Year37.72%
EBIT Next 3Y14.45%
EBIT Next 5Y12.25%
FCF growth 1Y68.07%
FCF growth 3Y6.53%
FCF growth 5Y11.03%
OCF growth 1Y44.03%
OCF growth 3Y6.69%
OCF growth 5Y9.03%