Taking everything into account, WES scores 6 out of 10 in our fundamental rating. WES was compared to 207 industry peers in the Oil, Gas & Consumable Fuels industry. WES scores excellent on profitability, but there are some minor concerns on its financial health. WES has a decent growth rate and is not valued too expensively.

Quickly go to:

1. Profitability

2. Health

3. Growth

4. Valuation

5. Dividend

1. Profitability

1.1 Basic Checks

WES had positive earnings in the past year.
In the past year WES had a positive cash flow from operations.
Each year in the past 5 years WES has been profitable.
In the past 5 years WES always reported a positive cash flow from operatings.

1.2 Ratios

WES's Return On Assets of 10.67% is amongst the best of the industry. WES outperforms 90.34% of its industry peers.
WES has a better Return On Equity (40.64%) than 93.72% of its industry peers.
Looking at the Return On Invested Capital, with a value of 11.36%, WES belongs to the top of the industry, outperforming 87.44% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for WES is significantly below the industry average of 21.94%.
The last Return On Invested Capital (11.36%) for WES is above the 3 year average (9.49%), which is a sign of increasing profitability.

		Industry Rank	Sector Rank
ROA	10.67%
ROE	40.64%
ROIC	11.36%

ROA(3y)10.08%

ROA(5y)8.51%

ROE(3y)40.66%

ROE(5y)34.2%

ROIC(3y)9.49%

ROIC(5y)9.22%

1.3 Margins

With an excellent Profit Margin value of 34.57%, WES belongs to the best of the industry, outperforming 91.30% of the companies in the same industry.
In the last couple of years the Profit Margin of WES has grown nicely.
The Operating Margin of WES (44.17%) is better than 89.37% of its industry peers.
In the last couple of years the Operating Margin of WES has grown nicely.
WES has a better Gross Margin (95.33%) than 98.55% of its industry peers.
WES's Gross Margin has improved in the last couple of years.

		Industry Rank	Sector Rank
OM	44.17%
PM (TTM)	34.57%
GM	95.33%

OM growth 3Y2.49%

OM growth 5Y3.58%

PM growth 3Y11.02%

PM growth 5Y12.07%

GM growth 3Y2.36%

GM growth 5Y2.58%

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ROA

ROE

ROIC

Operating and Profit Margin

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2. Health

2.1 Basic Checks

With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), WES is creating some value.
WES has about the same amout of shares outstanding than it did 1 year ago.
The number of shares outstanding for WES has been reduced compared to 5 years ago.
Compared to 1 year ago, WES has an improved debt to assets ratio.

2.2 Solvency

The Debt to FCF ratio of WES is 4.70, which is a neutral value as it means it would take WES, 4.70 years of fcf income to pay off all of its debts.
WES has a better Debt to FCF ratio (4.70) than 65.70% of its industry peers.
WES has a Debt/Equity ratio of 2.18. This is a high value indicating a heavy dependency on external financing.
The Debt to Equity ratio of WES (2.18) is worse than 82.13% of its industry peers.

		Industry Rank	Sector Rank
Debt/Equity	2.18
Debt/FCF	4.7
Altman-Z	N/A

ROIC/WACC1.41

WACC8.07%

2.3 Liquidity

WES has a Current Ratio of 1.43. This is a normal value and indicates that WES is financially healthy and should not expect problems in meeting its short term obligations.
The Current ratio of WES (1.43) is better than 63.77% of its industry peers.
A Quick Ratio of 1.41 indicates that WES should not have too much problems paying its short term obligations.
The Quick ratio of WES (1.41) is better than 69.57% of its industry peers.

		Industry Rank	Sector Rank
Current Ratio	1.43
Quick Ratio	1.41

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WACC

Debt/Equity

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Altman-Z score

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3. Growth

3.1 Past

The earnings per share for WES have decreased strongly by -13.78% in the last year.
Measured over the past years, WES shows a very strong growth in Earnings Per Share. The EPS has been growing by 20.90% on average per year.
Looking at the last year, WES shows a small growth in Revenue. The Revenue has grown by 5.81% in the last year.
WES shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.59% yearly.

EPS 1Y (TTM)-13.78%

EPS 3Y22.73%

EPS 5Y20.9%

EPS Q2Q%17.57%

Revenue 1Y (TTM)5.81%

Revenue growth 3Y7.81%

Revenue growth 5Y5.59%

Sales Q2Q%7.82%

3.2 Future

The Earnings Per Share is expected to grow by 0.03% on average over the next years.
The Revenue is expected to grow by 5.60% on average over the next years.

EPS Next Y-12.17%

EPS Next 2Y-3.72%

EPS Next 3Y0.03%

EPS Next 5YN/A

Revenue Next Year5.14%

Revenue Next 2Y6.07%

Revenue Next 3Y6.96%

Revenue Next 5Y5.6%

3.3 Evolution

The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.

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4. Valuation

4.1 Price/Earnings Ratio

A Price/Earnings ratio of 12.16 indicates a correct valuation of WES.
72.95% of the companies in the same industry are more expensive than WES, based on the Price/Earnings ratio.
When comparing the Price/Earnings ratio of WES to the average of the S&P500 Index (28.60), we can say WES is valued rather cheaply.
WES is valuated reasonably with a Price/Forward Earnings ratio of 11.00.
Based on the Price/Forward Earnings ratio, WES is valued a bit cheaper than 75.36% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 25.83. WES is valued rather cheaply when compared to this.

		Industry Rank	Sector Rank
PE	12.16
Fwd PE	11

4.2 Price Multiples

WES's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, WES is valued a bit cheaper than the industry average as 75.85% of the companies are valued more expensively.

		Industry Rank	Sector Rank
P/FCF	11.37
EV/EBITDA	10.08

4.3 Compensation for Growth

The excellent profitability rating of WES may justify a higher PE ratio.

PEG (NY)N/A

PEG (5Y)0.58

EPS Next 2Y-3.72%

EPS Next 3Y0.03%

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5. Dividend

5.1 Amount

With a Yearly Dividend Yield of 8.92%, WES is a good candidate for dividend investing.
WES's Dividend Yield is rather good when compared to the industry average which is at 3.73. WES pays more dividend than 87.44% of the companies in the same industry.
Compared to an average S&P500 Dividend Yield of 1.82, WES pays a better dividend.

		Industry Rank	Sector Rank
Dividend Yield	8.92%

5.2 History

The dividend of WES has a limited annual growth rate of 2.35%.
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)2.35%

Div Incr Years3

Div Non Decr Years3

5.3 Sustainability

WES pays out 107.67% of its income as dividend. This is not a sustainable payout ratio.
The dividend of WES is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.

DP107.67%

EPS Next 2Y-3.72%

EPS Next 3Y0.03%

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WESTERN MIDSTREAM PARTNERS L / WES FAQ

What is the fundamental rating for WES stock?

ChartMill assigns a fundamental rating of 6 / 10 to WES.

What is the valuation status of WESTERN MIDSTREAM PARTNERS L (WES) stock?

ChartMill assigns a valuation rating of 6 / 10 to WESTERN MIDSTREAM PARTNERS L (WES). This can be considered as Fairly Valued.

How profitable is WESTERN MIDSTREAM PARTNERS L (WES) stock?

WESTERN MIDSTREAM PARTNERS L (WES) has a profitability rating of 9 / 10.

Can you provide the PE and PB ratios for WES stock?

The Price/Earnings (PE) ratio for WESTERN MIDSTREAM PARTNERS L (WES) is 12.16 and the Price/Book (PB) ratio is 5.27.

What is the financial health of WESTERN MIDSTREAM PARTNERS L (WES) stock?

The financial health rating of WESTERN MIDSTREAM PARTNERS L (WES) is 4 / 10.