WPP PLC-SPONSORED ADR (WPP) Stock Fundamental Analysis
NYSE:WPP - New York Stock Exchange, Inc. - US92937A1025 - ADR
We assign a fundamental rating of 3 out of 10 to WPP. WPP was compared to 92 industry peers in the Media industry. There are concerns on the financial health of WPP while its profitability can be described as average. WPP has a valuation in line with the averages, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
WPP had positive earnings in the past year.
In the past year WPP had a positive cash flow from operations.
WPP had positive earnings in 4 of the past 5 years.
Each year in the past 5 years WPP had a positive operating cash flow.
1.2 Ratios
WPP has a Return On Assets (0.79%) which is in line with its industry peers.
With a decent Return On Equity value of 5.82%, WPP is doing good in the industry, outperforming 73.56% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 3.70%, WPP is in line with its industry, outperforming 52.87% of the companies in the same industry.
Measured over the past 3 years, the Average Return On Invested Capital for WPP is in line with the industry average of 6.90%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.79% | ||
| ROE | 5.82% | ||
| ROIC | 3.7% |
ROA(3y)1.69%
ROA(5y)-0.2%
ROE(3y)13.15%
ROE(5y)-2.52%
ROIC(3y)5.6%
ROIC(5y)N/A
1.3 Margins
WPP has a Profit Margin (1.37%) which is in line with its industry peers.
WPP's Profit Margin has declined in the last couple of years.
With a Operating Margin value of 4.36%, WPP perfoms like the industry average, outperforming 44.83% of the companies in the same industry.
In the last couple of years the Operating Margin of WPP has declined.
With a Gross Margin value of 16.80%, WPP is not doing good in the industry: 82.76% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of WPP has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 4.36% | ||
| PM (TTM) | 1.37% | ||
| GM | 16.8% |
OM growth 3YN/A
OM growth 5Y-17.82%
PM growth 3YN/A
PM growth 5Y-34.82%
GM growth 3Y0.36%
GM growth 5Y-2.3%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so WPP is destroying value.
WPP has more shares outstanding than it did 1 year ago.
Compared to 5 years ago, WPP has less shares outstanding
Compared to 1 year ago, WPP has a worse debt to assets ratio.
2.2 Solvency
WPP has an Altman-Z score of 1.00. This is a bad value and indicates that WPP is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of WPP (1.00) is comparable to the rest of the industry.
WPP has a debt to FCF ratio of 8.45. This is a slightly negative value and a sign of low solvency as WPP would need 8.45 years to pay back of all of its debts.
Looking at the Debt to FCF ratio, with a value of 8.45, WPP is in the better half of the industry, outperforming 60.92% of the companies in the same industry.
A Debt/Equity ratio of 1.74 is on the high side and indicates that WPP has dependencies on debt financing.
The Debt to Equity ratio of WPP (1.74) is worse than 67.82% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.74 | ||
| Debt/FCF | 8.45 | ||
| Altman-Z | 1 |
ROIC/WACC0.58
WACC6.38%
2.3 Liquidity
WPP has a Current Ratio of 0.89. This is a bad value and indicates that WPP is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.89, WPP is not doing good in the industry: 79.31% of the companies in the same industry are doing better.
A Quick Ratio of 0.89 indicates that WPP may have some problems paying its short term obligations.
The Quick ratio of WPP (0.89) is worse than 78.16% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.89 | ||
| Quick Ratio | 0.89 |
3. Growth
3.1 Past
The earnings per share for WPP have decreased by -8.67% in the last year.
The Earnings Per Share has been decreasing by -2.78% on average over the past years.
Looking at the last year, WPP shows a decrease in Revenue. The Revenue has decreased by -0.30% in the last year.
WPP shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.62% yearly.
EPS 1Y (TTM)-8.67%
EPS 3Y16.12%
EPS 5Y-2.78%
EPS Q2Q%-6.65%
Revenue 1Y (TTM)-0.3%
Revenue growth 3Y7.34%
Revenue growth 5Y2.62%
Sales Q2Q%0.08%
3.2 Future
Based on estimates for the next years, WPP will show a decrease in Earnings Per Share. The EPS will decrease by -2.30% on average per year.
Based on estimates for the next years, WPP will show a small growth in Revenue. The Revenue will grow by 1.44% on average per year.
EPS Next Y-5.64%
EPS Next 2Y-1.88%
EPS Next 3Y0.77%
EPS Next 5Y-2.3%
Revenue Next Year-1.76%
Revenue Next 2Y-1.02%
Revenue Next 3Y0.46%
Revenue Next 5Y1.44%
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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 8.06, which indicates a very decent valuation of WPP.
Based on the Price/Earnings ratio, WPP is valued cheaper than 85.06% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 28.29, WPP is valued rather cheaply.
WPP is valuated reasonably with a Price/Forward Earnings ratio of 8.18.
Compared to the rest of the industry, the Price/Forward Earnings ratio of WPP indicates a rather cheap valuation: WPP is cheaper than 87.36% of the companies listed in the same industry.
When comparing the Price/Forward Earnings ratio of WPP to the average of the S&P500 Index (24.44), we can say WPP is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.06 | ||
| Fwd PE | 8.18 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, WPP is valued a bit cheaper than the industry average as 66.67% of the companies are valued more expensively.
Based on the Price/Free Cash Flow ratio, WPP is valued a bit cheaper than 79.31% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.05 | ||
| EV/EBITDA | 7.33 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-1.88%
EPS Next 3Y0.77%
5. Dividend
5.1 Amount
WPP has a Yearly Dividend Yield of 5.39%, which is a nice return.
Compared to an average industry Dividend Yield of 4.46, WPP pays a better dividend. On top of this WPP pays more dividend than 90.80% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.28, WPP pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.39% |
5.2 History
The dividend of WPP decreases each year by -7.77%.
WPP has been paying a dividend for at least 10 years, so it has a reliable track record.
WPP has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)-7.77%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
207.87% of the earnings are spent on dividend by WPP. This is not a sustainable payout ratio.
The Dividend Rate of WPP has been decling, while earnings will also be declining. This means the current dividend is most likely not sustainable.
DP207.87%
EPS Next 2Y-1.88%
EPS Next 3Y0.77%
WPP PLC-SPONSORED ADR
NYSE:WPP (1/21/2025, 8:04:00 PM)
After market: 45.64 0 (0%)45.64
+0.53 (+1.17%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryMedia
Earnings (Last)
Earnings (Next)
Inst Owners65.37%
Inst Owner Change-0.24%
Ins Owners0.18%
Ins Owner Change0%
Market Cap9.84B
Analysts71.54
Price Target55.17 (20.88%)
Short Float %0.16%
Short Ratio2.02
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.39% |
Yearly Dividend0.39
Dividend Growth(5Y)-7.77%
DP207.87%
Div Incr Years3
Div Non Decr Years3
Ex-DateN/A
Surprises & Revisions
EPS beat(2)N/A
Avg EPS beat(2)N/A
Min EPS beat(2)N/A
Max EPS beat(2)N/A
EPS beat(4)N/A
Avg EPS beat(4)N/A
Min EPS beat(4)N/A
Max EPS beat(4)N/A
EPS beat(8)N/A
Avg EPS beat(8)N/A
EPS beat(12)N/A
Avg EPS beat(12)N/A
EPS beat(16)N/A
Avg EPS beat(16)N/A
Revenue beat(2)N/A
Avg Revenue beat(2)N/A
Min Revenue beat(2)N/A
Max Revenue beat(2)N/A
Revenue beat(4)N/A
Avg Revenue beat(4)N/A
Min Revenue beat(4)N/A
Max Revenue beat(4)N/A
Revenue beat(8)N/A
Avg Revenue beat(8)N/A
Revenue beat(12)N/A
Avg Revenue beat(12)N/A
Revenue beat(16)N/A
Avg Revenue beat(16)N/A
PT rev (1m)-0.52%
PT rev (3m)-2.83%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)0%
EPS NY rev (3m)-2.11%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)-0.35%
Revenue NY rev (3m)-1.06%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.06 | ||
| Fwd PE | 8.18 | ||
| P/S | 0.54 | ||
| P/FCF | 9.05 | ||
| P/OCF | 7.25 | ||
| P/B | 2.31 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.33 |
EPS(TTM)5.66
EY12.4%
EPS(NY)5.58
Fwd EY12.22%
FCF(TTM)5.04
FCFY11.05%
OCF(TTM)6.29
OCFY13.78%
SpS83.98
BVpS19.78
TBVpS-31.9
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 0.79% | ||
| ROE | 5.82% | ||
| ROCE | 5.99% | ||
| ROIC | 3.7% | ||
| ROICexc | 4.61% | ||
| ROICexgc | N/A | ||
| OM | 4.36% | ||
| PM (TTM) | 1.37% | ||
| GM | 16.8% | ||
| FCFM | 6.01% |
ROA(3y)1.69%
ROA(5y)-0.2%
ROE(3y)13.15%
ROE(5y)-2.52%
ROIC(3y)5.6%
ROIC(5y)N/A
ROICexc(3y)7.59%
ROICexc(5y)N/A
ROICexgc(3y)N/A
ROICexgc(5y)N/A
ROCE(3y)9.38%
ROCE(5y)N/A
ROICexcg growth 3YN/A
ROICexcg growth 5YN/A
ROICexc growth 3YN/A
ROICexc growth 5Y-21.01%
OM growth 3YN/A
OM growth 5Y-17.82%
PM growth 3YN/A
PM growth 5Y-34.82%
GM growth 3Y0.36%
GM growth 5Y-2.3%
F-Score7
Asset Turnover0.58
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.74 | ||
| Debt/FCF | 8.45 | ||
| Debt/EBITDA | 3.33 | ||
| Cap/Depr | 18.71% | ||
| Cap/Sales | 1.48% | ||
| Interest Coverage | 1.92 | ||
| Cash Conversion | 60.93% | ||
| Profit Quality | 438.59% | ||
| Current Ratio | 0.89 | ||
| Quick Ratio | 0.89 | ||
| Altman-Z | 1 |
F-Score7
WACC6.38%
ROIC/WACC0.58
Cap/Depr(3y)38.7%
Cap/Depr(5y)43.35%
Cap/Sales(3y)1.77%
Cap/Sales(5y)2.11%
Profit Quality(3y)422.53%
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-8.67%
EPS 3Y16.12%
EPS 5Y-2.78%
EPS Q2Q%-6.65%
EPS Next Y-5.64%
EPS Next 2Y-1.88%
EPS Next 3Y0.77%
EPS Next 5Y-2.3%
Revenue 1Y (TTM)-0.3%
Revenue growth 3Y7.34%
Revenue growth 5Y2.62%
Sales Q2Q%0.08%
Revenue Next Year-1.76%
Revenue Next 2Y-1.02%
Revenue Next 3Y0.46%
Revenue Next 5Y1.44%
EBIT growth 1Y-42.44%
EBIT growth 3YN/A
EBIT growth 5Y-15.67%
EBIT Next Year23.6%
EBIT Next 3Y7.93%
EBIT Next 5Y10.85%
FCF growth 1Y46.44%
FCF growth 3Y-16.95%
FCF growth 5Y-4.99%
OCF growth 1Y26.28%
OCF growth 3Y-15.54%
OCF growth 5Y-6.07%