WILLIAMS COS INC (WMB) Stock Fundamental Analysis
USA - NYSE:WMB - US9694571004 - Common Stock
60.99 USD
+1.4 (+2.35%)
61.1 USD
+0.11 (+0.18%)
WMB gets a fundamental rating of 4 out of 10. The analysis compared the fundamentals against 210 industry peers in the Oil, Gas & Consumable Fuels industry. WMB scores excellent on profitability, but there are concerns on its financial health. WMB is quite expensive at the moment. It does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year WMB was profitable.
In the past year WMB had a positive cash flow from operations.
Each year in the past 5 years WMB has been profitable.
Each year in the past 5 years WMB had a positive operating cash flow.
1.2 Ratios
WMB's Return On Assets of 4.25% is in line compared to the rest of the industry. WMB outperforms 60.00% of its industry peers.
With an excellent Return On Equity value of 18.91%, WMB belongs to the best of the industry, outperforming 84.76% of the companies in the same industry.
WMB has a Return On Invested Capital (6.06%) which is comparable to the rest of the industry.
The Average Return On Invested Capital over the past 3 years for WMB is significantly below the industry average of 21.85%.
The last Return On Invested Capital (6.06%) for WMB is above the 3 year average (5.82%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.25% | ||
| ROE | 18.91% | ||
| ROIC | 6.06% |
ROA(3y)4.78%
ROA(5y)3.6%
ROE(3y)20.43%
ROE(5y)15.26%
ROIC(3y)5.82%
ROIC(5y)5.41%
1.3 Margins
The Profit Margin of WMB (20.59%) is better than 74.76% of its industry peers.
WMB's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 34.18%, WMB belongs to the top of the industry, outperforming 80.48% of the companies in the same industry.
In the last couple of years the Operating Margin of WMB has grown nicely.
Looking at the Gross Margin, with a value of 80.62%, WMB belongs to the top of the industry, outperforming 90.95% of the companies in the same industry.
In the last couple of years the Gross Margin of WMB has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 34.18% | ||
| PM (TTM) | 20.59% | ||
| GM | 80.62% |
OM growth 3Y8.61%
OM growth 5Y1.79%
PM growth 3Y14.09%
PM growth 5Y15.42%
GM growth 3Y8.76%
GM growth 5Y1.31%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), WMB is destroying value.
Compared to 1 year ago, WMB has about the same amount of shares outstanding.
WMB has more shares outstanding than it did 5 years ago.
The debt/assets ratio for WMB has been reduced compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.07, we must say that WMB is in the distress zone and has some risk of bankruptcy.
The Altman-Z score of WMB (1.07) is comparable to the rest of the industry.
The Debt to FCF ratio of WMB is 16.25, which is on the high side as it means it would take WMB, 16.25 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of WMB (16.25) is comparable to the rest of the industry.
A Debt/Equity ratio of 2.06 is on the high side and indicates that WMB has dependencies on debt financing.
WMB's Debt to Equity ratio of 2.06 is on the low side compared to the rest of the industry. WMB is outperformed by 80.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.06 | ||
| Debt/FCF | 16.25 | ||
| Altman-Z | 1.07 |
ROIC/WACC0.77
WACC7.82%
2.3 Liquidity
A Current Ratio of 0.42 indicates that WMB may have some problems paying its short term obligations.
WMB has a Current ratio of 0.42. This is amonst the worse of the industry: WMB underperforms 88.57% of its industry peers.
WMB has a Quick Ratio of 0.42. This is a bad value and indicates that WMB is not financially healthy enough and could expect problems in meeting its short term obligations.
WMB has a worse Quick ratio (0.36) than 89.52% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.42 | ||
| Quick Ratio | 0.36 |
3. Growth
3.1 Past
WMB shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 2.63%.
WMB shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 13.18% yearly.
WMB shows quite a strong growth in Revenue. In the last year, the Revenue has grown by 9.02%.
The Revenue has been growing slightly by 5.07% on average over the past years.
EPS 1Y (TTM)2.63%
EPS 3Y10.47%
EPS 5Y13.18%
EPS Q2Q%32.5%
Revenue 1Y (TTM)9.02%
Revenue growth 3Y-0.39%
Revenue growth 5Y5.07%
Sales Q2Q%10.18%
3.2 Future
The Earnings Per Share is expected to grow by 14.74% on average over the next years. This is quite good.
WMB is expected to show quite a strong growth in Revenue. In the coming years, the Revenue will grow by 9.85% yearly.
EPS Next Y16.39%
EPS Next 2Y15.2%
EPS Next 3Y15.28%
EPS Next 5Y14.74%
Revenue Next Year12.67%
Revenue Next 2Y9.92%
Revenue Next 3Y10.34%
Revenue Next 5Y9.85%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 31.28, which means the current valuation is very expensive for WMB.
61.43% of the companies in the same industry are cheaper than WMB, based on the Price/Earnings ratio.
WMB's Price/Earnings ratio indicates a valuation a bit more expensive than the S&P500 average which is at 25.89.
A Price/Forward Earnings ratio of 25.25 indicates a quite expensive valuation of WMB.
Compared to the rest of the industry, the Price/Forward Earnings ratio of WMB is on the same level as its industry peers.
When comparing the Price/Forward Earnings ratio of WMB to the average of the S&P500 Index (34.59), we can say WMB is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.28 | ||
| Fwd PE | 25.25 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, WMB is valued a bit more expensive than the industry average as 65.71% of the companies are valued more cheaply.
WMB's Price/Free Cash Flow is on the same level as the industry average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 43.25 | ||
| EV/EBITDA | 16.09 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
The decent profitability rating of WMB may justify a higher PE ratio.
WMB's earnings are expected to grow with 15.28% in the coming years. This may justify a more expensive valuation.
PEG (NY)1.91
PEG (5Y)2.37
EPS Next 2Y15.2%
EPS Next 3Y15.28%
5. Dividend
5.1 Amount
WMB has a Yearly Dividend Yield of 3.47%. Purely for dividend investing, there may be better candidates out there.
WMB's Dividend Yield is comparable with the industry average which is at 5.89.
WMB's Dividend Yield is a higher than the S&P500 average which is at 2.36.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.47% |
5.2 History
The dividend of WMB has a limited annual growth rate of 4.57%.
WMB has been paying a dividend for at least 10 years, so it has a reliable track record.
WMB has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)4.57%
Div Incr Years7
Div Non Decr Years7
5.3 Sustainability
101.86% of the earnings are spent on dividend by WMB. This is not a sustainable payout ratio.
WMB's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP101.86%
EPS Next 2Y15.2%
EPS Next 3Y15.28%
60.99
+1.4 (+2.35%)
Chartmill FA Rating
GICS SectorEnergy
GICS IndustryGroupEnergy
GICS IndustryOil, Gas & Consumable Fuels
Earnings (Last)
Earnings (Next)
Inst Owners88.64%
Inst Owner Change-0.99%
Ins Owners0.4%
Ins Owner Change0.18%
Market Cap74.48B
Revenue(TTM)11.49B
Net Income(TTM)2.37B
Analysts77.24
Price Target68.28 (11.95%)
Short Float %1.05%
Short Ratio1.95
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.47% |
Yearly Dividend1.9
Dividend Growth(5Y)4.57%
DP101.86%
Div Incr Years7
Div Non Decr Years7
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.89%
Min EPS beat(2)-6.28%
Max EPS beat(2)2.49%
EPS beat(4)2
Avg EPS beat(4)-4.3%
Min EPS beat(4)-13.58%
Max EPS beat(4)2.49%
EPS beat(8)5
Avg EPS beat(8)1.48%
EPS beat(12)9
Avg EPS beat(12)9.9%
EPS beat(16)12
Avg EPS beat(16)9.18%
Revenue beat(2)2
Avg Revenue beat(2)0.42%
Min Revenue beat(2)0.03%
Max Revenue beat(2)0.8%
Revenue beat(4)4
Avg Revenue beat(4)1.17%
Min Revenue beat(4)0.03%
Max Revenue beat(4)2.59%
Revenue beat(8)7
Avg Revenue beat(8)0.49%
Revenue beat(12)8
Avg Revenue beat(12)0.67%
Revenue beat(16)10
Avg Revenue beat(16)2.33%
PT rev (1m)5.57%
PT rev (3m)6.65%
EPS NQ rev (1m)-0.7%
EPS NQ rev (3m)-1.94%
EPS NY rev (1m)-0.39%
EPS NY rev (3m)-2.23%
Revenue NQ rev (1m)0.45%
Revenue NQ rev (3m)1.04%
Revenue NY rev (1m)0.03%
Revenue NY rev (3m)0.26%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 31.28 | ||
| Fwd PE | 25.25 | ||
| P/S | 6.48 | ||
| P/FCF | 43.25 | ||
| P/OCF | 13.44 | ||
| P/B | 5.95 | ||
| P/tB | 13.5 | ||
| EV/EBITDA | 16.09 |
EPS(TTM)1.95
EY3.2%
EPS(NY)2.42
Fwd EY3.96%
FCF(TTM)1.41
FCFY2.31%
OCF(TTM)4.54
OCFY7.44%
SpS9.41
BVpS10.25
TBVpS4.52
PEG (NY)1.91
PEG (5Y)2.37
Graham Number21.21
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 4.25% | ||
| ROE | 18.91% | ||
| ROCE | 7.8% | ||
| ROIC | 6.06% | ||
| ROICexc | 6.06% | ||
| ROICexgc | 7.04% | ||
| OM | 34.18% | ||
| PM (TTM) | 20.59% | ||
| GM | 80.62% | ||
| FCFM | 14.98% |
ROA(3y)4.78%
ROA(5y)3.6%
ROE(3y)20.43%
ROE(5y)15.26%
ROIC(3y)5.82%
ROIC(5y)5.41%
ROICexc(3y)5.94%
ROICexc(5y)5.53%
ROICexgc(3y)7.08%
ROICexgc(5y)6.64%
ROCE(3y)7.56%
ROCE(5y)7%
ROICexgc growth 3Y0.06%
ROICexgc growth 5Y2.22%
ROICexc growth 3Y1.49%
ROICexc growth 5Y3.34%
OM growth 3Y8.61%
OM growth 5Y1.79%
PM growth 3Y14.09%
PM growth 5Y15.42%
GM growth 3Y8.76%
GM growth 5Y1.31%
F-Score5
Asset Turnover0.21
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 2.06 | ||
| Debt/FCF | 16.25 | ||
| Debt/EBITDA | 4.12 | ||
| Cap/Depr | 164.64% | ||
| Cap/Sales | 33.21% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 88.67% | ||
| Profit Quality | 72.75% | ||
| Current Ratio | 0.42 | ||
| Quick Ratio | 0.36 | ||
| Altman-Z | 1.07 |
F-Score5
WACC7.82%
ROIC/WACC0.77
Cap/Depr(3y)119.42%
Cap/Depr(5y)100.01%
Cap/Sales(3y)23.28%
Cap/Sales(5y)19.62%
Profit Quality(3y)112.28%
Profit Quality(5y)316.57%
High Growth Momentum
Growth
EPS 1Y (TTM)2.63%
EPS 3Y10.47%
EPS 5Y13.18%
EPS Q2Q%32.5%
EPS Next Y16.39%
EPS Next 2Y15.2%
EPS Next 3Y15.28%
EPS Next 5Y14.74%
Revenue 1Y (TTM)9.02%
Revenue growth 3Y-0.39%
Revenue growth 5Y5.07%
Sales Q2Q%10.18%
Revenue Next Year12.67%
Revenue Next 2Y9.92%
Revenue Next 3Y10.34%
Revenue Next 5Y9.85%
EBIT growth 1Y7.97%
EBIT growth 3Y8.18%
EBIT growth 5Y6.95%
EBIT Next Year82.74%
EBIT Next 3Y28.55%
EBIT Next 5Y20.48%
FCF growth 1Y-34.99%
FCF growth 3Y-5.24%
FCF growth 5Y8.26%
OCF growth 1Y3.67%
OCF growth 3Y8.03%
OCF growth 5Y6.14%
WILLIAMS COS INC / WMB FAQ
What is the fundamental rating for WMB stock?
ChartMill assigns a fundamental rating of 4 / 10 to WMB.
What is the valuation status of WILLIAMS COS INC (WMB) stock?
ChartMill assigns a valuation rating of 2 / 10 to WILLIAMS COS INC (WMB). This can be considered as Overvalued.
How profitable is WILLIAMS COS INC (WMB) stock?
WILLIAMS COS INC (WMB) has a profitability rating of 7 / 10.
What is the valuation of WILLIAMS COS INC based on its PE and PB ratios?
The Price/Earnings (PE) ratio for WILLIAMS COS INC (WMB) is 31.28 and the Price/Book (PB) ratio is 5.95.
How sustainable is the dividend of WILLIAMS COS INC (WMB) stock?
The dividend rating of WILLIAMS COS INC (WMB) is 5 / 10 and the dividend payout ratio is 101.86%.