WESTERN MIDSTREAM PARTNERS L (WES) Stock Fundamental Analysis
NYSE:WES - New York Stock Exchange, Inc. - US9586691035 - Currency: USD
We assign a fundamental rating of 5 out of 10 to WES. WES was compared to 210 industry peers in the Oil, Gas & Consumable Fuels industry. WES scores excellent on profitability, but there are concerns on its financial health. WES has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year WES was profitable.
In the past year WES had a positive cash flow from operations.
WES had positive earnings in 4 of the past 5 years.
Of the past 5 years WES 4 years had a positive operating cash flow.
1.2 Ratios
With an excellent Return On Assets value of 11.50%, WES belongs to the best of the industry, outperforming 83.25% of the companies in the same industry.
WES has a Return On Equity of 46.12%. This is amongst the best in the industry. WES outperforms 93.10% of its industry peers.
Looking at the Return On Invested Capital, with a value of 9.80%, WES is in the better half of the industry, outperforming 66.01% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for WES is significantly below the industry average of 28.61%.
The last Return On Invested Capital (9.80%) for WES is above the 3 year average (9.05%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.5% | ||
| ROE | 46.12% | ||
| ROIC | 9.8% |
ROA(3y)8.84%
ROA(5y)7.25%
ROE(3y)34.93%
ROE(5y)28.84%
ROIC(3y)9.05%
ROIC(5y)8.57%
1.3 Margins
With an excellent Profit Margin value of 42.23%, WES belongs to the best of the industry, outperforming 90.15% of the companies in the same industry.
In the last couple of years the Profit Margin of WES has grown nicely.
With an excellent Operating Margin value of 43.28%, WES belongs to the best of the industry, outperforming 85.22% of the companies in the same industry.
In the last couple of years the Operating Margin of WES has remained more or less at the same level.
WES has a Gross Margin of 95.09%. This is amongst the best in the industry. WES outperforms 99.51% of its industry peers.
WES's Gross Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 43.28% | ||
| PM (TTM) | 42.23% | ||
| GM | 95.09% |
OM growth 3Y-3.69%
OM growth 5Y1.3%
PM growth 3Y19.99%
PM growth 5Y14.88%
GM growth 3Y0.53%
GM growth 5Y2.94%
2. Health
2.1 Basic Checks
WES has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
WES has no outstanding debt. Therefor its Debt/Equity and Debt/FCF ratios are 0 and belong to the best of the industry.
2.2 Solvency
The Debt to FCF ratio of WES is 6.29, which is on the high side as it means it would take WES, 6.29 years of fcf income to pay off all of its debts.
WES has a Debt to FCF ratio of 6.29. This is comparable to the rest of the industry: WES outperforms 54.19% of its industry peers.
A Debt/Equity ratio of 2.45 is on the high side and indicates that WES has dependencies on debt financing.
WES's Debt to Equity ratio of 2.45 is on the low side compared to the rest of the industry. WES is outperformed by 87.68% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.45 | ||
| Debt/FCF | 6.29 | ||
| Altman-Z | N/A |
ROIC/WACC1.24
WACC7.91%
2.3 Liquidity
WES has a Current Ratio of 1.11. This is a normal value and indicates that WES is financially healthy and should not expect problems in meeting its short term obligations.
Looking at the Current ratio, with a value of 1.11, WES is in line with its industry, outperforming 42.86% of the companies in the same industry.
WES has a Quick Ratio of 1.11. This is a normal value and indicates that WES is financially healthy and should not expect problems in meeting its short term obligations.
WES has a Quick ratio (1.11) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.11 | ||
| Quick Ratio | 1.11 |
3. Growth
3.1 Past
The Earnings Per Share has grown by an impressive 55.00% over the past year.
WES shows a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 20.90% yearly.
EPS 1Y (TTM)55%
EPS 3Y22.73%
EPS 5Y20.9%
EPS Q2Q%14.86%
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%8.19%
3.2 Future
WES is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -2.60% yearly.
The Revenue is expected to grow by 3.76% on average over the next years.
EPS Next Y-12.52%
EPS Next 2Y-2.6%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue Next Year2.15%
Revenue Next 2Y3.76%
Revenue Next 3YN/A
Revenue Next 5YN/A
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.
4. Valuation
4.1 Price/Earnings Ratio
WES is valuated reasonably with a Price/Earnings ratio of 9.91.
Based on the Price/Earnings ratio, WES is valued a bit cheaper than the industry average as 65.52% of the companies are valued more expensively.
Compared to an average S&P500 Price/Earnings ratio of 29.01, WES is valued rather cheaply.
Based on the Price/Forward Earnings ratio of 11.33, the valuation of WES can be described as reasonable.
Based on the Price/Forward Earnings ratio, WES is valued a bit cheaper than the industry average as 62.07% of the companies are valued more expensively.
WES is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 22.40, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.91 | ||
| Fwd PE | 11.33 |
4.2 Price Multiples
WES's Enterprise Value to EBITDA is on the same level as the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of WES indicates a somewhat cheap valuation: WES is cheaper than 61.58% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 12.05 | ||
| EV/EBITDA | 9.72 |
4.3 Compensation for Growth
The excellent profitability rating of WES may justify a higher PE ratio.
WES's earnings are expected to decrease with -2.60% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)0.47
EPS Next 2Y-2.6%
EPS Next 3YN/A
5. Dividend
5.1 Amount
WES has a Yearly Dividend Yield of 8.73%, which is a nice return.
WES's Dividend Yield is rather good when compared to the industry average which is at 6.73. WES pays more dividend than 83.74% of the companies in the same industry.
WES's Dividend Yield is rather good when compared to the S&P500 average which is at 2.27.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.73% |
5.2 History
The dividend of WES has a limited annual growth rate of 2.24%.
WES has paid a dividend for at least 10 years, which is a reliable track record.
WES has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)2.24%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
WES pays out 75.60% of its income as dividend. This is not a sustainable payout ratio.
WES's earnings are declining while the Dividend Rate has been growing. This means the dividend growth is most likely not sustainable.
DP75.6%
EPS Next 2Y-2.6%
EPS Next 3YN/A
39.95
-0.49 (-1.21%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners85.01%
Inst Owner Change0.81%
Ins Owners0.17%
Ins Owner Change7.53%
Market Cap15.20B
Analysts65.56
Price Target41.03 (2.7%)
Short Float %1.97%
Short Ratio6
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 8.73% |
Yearly Dividend2.56
Dividend Growth(5Y)2.24%
DP75.6%
Div Incr Years3
Div Non Decr Years3
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.39%
Min EPS beat(2)-12%
Max EPS beat(2)9.22%
EPS beat(4)2
Avg EPS beat(4)18.31%
Min EPS beat(4)-12%
Max EPS beat(4)81.72%
EPS beat(8)4
Avg EPS beat(8)9.52%
EPS beat(12)5
Avg EPS beat(12)5.56%
EPS beat(16)6
Avg EPS beat(16)2.74%
Revenue beat(2)0
Avg Revenue beat(2)-4.04%
Min Revenue beat(2)-6.34%
Max Revenue beat(2)-1.75%
Revenue beat(4)1
Avg Revenue beat(4)-2.31%
Min Revenue beat(4)-6.34%
Max Revenue beat(4)0.53%
Revenue beat(8)1
Avg Revenue beat(8)-4.81%
Revenue beat(12)3
Avg Revenue beat(12)-3.35%
Revenue beat(16)6
Avg Revenue beat(16)-2.38%
PT rev (1m)0.21%
PT rev (3m)0.84%
EPS NQ rev (1m)-1.3%
EPS NQ rev (3m)-1.65%
EPS NY rev (1m)1.38%
EPS NY rev (3m)-1.51%
Revenue NQ rev (1m)-0.79%
Revenue NQ rev (3m)-0.79%
Revenue NY rev (1m)-0.24%
Revenue NY rev (3m)-1.27%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.91 | ||
| Fwd PE | 11.33 | ||
| P/S | 4.3 | ||
| P/FCF | 12.05 | ||
| P/OCF | 7.4 | ||
| P/B | 4.7 | ||
| P/tB | 5.91 | ||
| EV/EBITDA | 9.72 |
EPS(TTM)4.03
EY10.09%
EPS(NY)3.53
Fwd EY8.82%
FCF(TTM)3.32
FCFY8.3%
OCF(TTM)5.4
OCFY13.52%
SpS9.29
BVpS8.51
TBVpS6.76
PEG (NY)N/A
PEG (5Y)0.47
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 11.5% | ||
| ROE | 46.12% | ||
| ROCE | 13.5% | ||
| ROIC | 9.8% | ||
| ROICexc | 10.78% | ||
| ROICexgc | 11.46% | ||
| OM | 43.28% | ||
| PM (TTM) | 42.23% | ||
| GM | 95.09% | ||
| FCFM | 35.7% |
ROA(3y)8.84%
ROA(5y)7.25%
ROE(3y)34.93%
ROE(5y)28.84%
ROIC(3y)9.05%
ROIC(5y)8.57%
ROICexc(3y)9.26%
ROICexc(5y)8.78%
ROICexgc(3y)9.93%
ROICexgc(5y)9.49%
ROCE(3y)11.92%
ROCE(5y)11.21%
ROICexcg growth 3Y-2.32%
ROICexcg growth 5Y4.75%
ROICexc growth 3Y-1.89%
ROICexc growth 5Y6.14%
OM growth 3Y-3.69%
OM growth 5Y1.3%
PM growth 3Y19.99%
PM growth 5Y14.88%
GM growth 3Y0.53%
GM growth 5Y2.94%
F-Score7
Asset Turnover0.27
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.45 | ||
| Debt/FCF | 6.29 | ||
| Debt/EBITDA | 3.63 | ||
| Cap/Depr | 121.63% | ||
| Cap/Sales | 22.45% | ||
| Interest Coverage | 4.3 | ||
| Cash Conversion | 94.2% | ||
| Profit Quality | 84.54% | ||
| Current Ratio | 1.11 | ||
| Quick Ratio | 1.11 | ||
| Altman-Z | N/A |
F-Score7
WACC7.91%
ROIC/WACC1.24
Cap/Depr(3y)87.64%
Cap/Depr(5y)119.01%
Cap/Sales(3y)16.52%
Cap/Sales(5y)21.62%
Profit Quality(3y)118.97%
Profit Quality(5y)122.54%
High Growth Momentum
Growth
EPS 1Y (TTM)55%
EPS 3Y22.73%
EPS 5Y20.9%
EPS Q2Q%14.86%
EPS Next Y-12.52%
EPS Next 2Y-2.6%
EPS Next 3YN/A
EPS Next 5YN/A
Revenue 1Y (TTM)N/A
Revenue growth 3YN/A
Revenue growth 5YN/A
Sales Q2Q%8.19%
Revenue Next Year2.15%
Revenue Next 2Y3.76%
Revenue Next 3YN/A
Revenue Next 5YN/A
EBIT growth 1Y24.58%
EBIT growth 3Y0.03%
EBIT growth 5Y7.58%
EBIT Next Year66.04%
EBIT Next 3Y21.43%
EBIT Next 5Y13.37%
FCF growth 1Y-12.16%
FCF growth 3Y-8.63%
FCF growth 5YN/A
OCF growth 1Y9.69%
OCF growth 3Y0.48%
OCF growth 5Y4.27%