WPP PLC-SPONSORED ADR (WPP) Stock Fundamental Analysis
NYSE:WPP - New York Stock Exchange, Inc. - US92937A1025 - ADR - Currency: USD
We assign a fundamental rating of 3 out of 10 to WPP. WPP was compared to 93 industry peers in the Media industry. While WPP is still in line with the averages on profitability rating, there are concerns on its financial health. WPP has a valuation in line with the averages, but on the other hand it scores bad on growth.
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.
WPP had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
Looking at the Return On Assets, with a value of 0.79%, WPP is in line with its industry, outperforming 58.62% of the companies in the same industry.
WPP has a Return On Equity of 5.82%. This is in the better half of the industry: WPP outperforms 73.56% of its industry peers.
WPP has a Return On Invested Capital of 3.70%. This is comparable to the rest of the industry: WPP outperforms 52.87% of its industry peers.
The Average Return On Invested Capital over the past 3 years for WPP is in line with the industry average of 7.01%.
| 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 of 1.37%. This is comparable to the rest of the industry: WPP outperforms 56.32% of its industry peers.
WPP's Profit Margin has declined in the last couple of years.
WPP's Operating Margin of 4.36% is in line compared to the rest of the industry. WPP outperforms 43.68% of its industry peers.
WPP's Operating Margin has declined in the last couple of years.
WPP has a Gross Margin of 16.80%. This is amonst the worse of the industry: WPP underperforms 83.91% of its industry peers.
WPP's Gross Margin has declined in the last couple of years.
| 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
WPP has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
The number of shares outstanding for WPP has been increased compared to 1 year ago.
Compared to 5 years ago, WPP has less shares outstanding
WPP has a worse debt/assets ratio than last year.
2.2 Solvency
WPP has an Altman-Z score of 1.01. This is a bad value and indicates that WPP is not financially healthy and even has some risk of bankruptcy.
WPP has a Altman-Z score (1.01) which is in line with its industry peers.
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.
The Debt to FCF ratio of WPP (8.45) is comparable to the rest of the industry.
WPP has a Debt/Equity ratio of 1.74. This is a high value indicating a heavy dependency on external financing.
With a Debt to Equity ratio value of 1.74, WPP is not doing good in the industry: 67.82% of the companies in the same industry are doing better.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.74 | ||
| Debt/FCF | 8.45 | ||
| Altman-Z | 1.01 |
ROIC/WACC0.58
WACC6.39%
2.3 Liquidity
A Current Ratio of 0.89 indicates that WPP may have some problems paying 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.
WPP has a Quick ratio of 0.89. This is in the lower half of the industry: WPP underperforms 78.16% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.89 | ||
| Quick Ratio | 0.89 |
3. Growth
3.1 Past
WPP shows a slight negative growth in Earnings Per Share. In the last year, the EPS has decreased by -8.67%.
The Earnings Per Share has been decreasing by -2.78% on average over the past years.
The Revenue has decreased by -0.30% in the past 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
WPP is expected to show a decrease in Earnings Per Share. In the coming years, the EPS will decrease by -2.34% yearly.
The Revenue is expected to grow by 1.44% on average over the next years.
EPS Next Y-6.5%
EPS Next 2Y-1.77%
EPS Next 3Y0.46%
EPS Next 5Y-2.34%
Revenue Next Year-1.71%
Revenue Next 2Y-0.89%
Revenue Next 3Y0.57%
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.
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
With a Price/Earnings ratio of 8.11, the valuation of WPP can be described as very reasonable.
Compared to the rest of the industry, the Price/Earnings ratio of WPP indicates a rather cheap valuation: WPP is cheaper than 85.06% of the companies listed in the same industry.
When comparing the Price/Earnings ratio of WPP to the average of the S&P500 Index (29.63), we can say WPP is valued rather cheaply.
WPP is valuated reasonably with a Price/Forward Earnings ratio of 8.22.
Based on the Price/Forward Earnings ratio, WPP is valued cheaper than 87.36% of the companies in the same industry.
The average S&P500 Price/Forward Earnings ratio is at 22.68. WPP is valued rather cheaply when compared to this.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.11 | ||
| Fwd PE | 8.22 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of WPP indicates a somewhat cheap valuation: WPP is cheaper than 65.52% of the companies listed in the same industry.
Based on the Price/Free Cash Flow ratio, WPP is valued a bit cheaper than 78.16% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 9.1 | ||
| EV/EBITDA | 7.43 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-1.77%
EPS Next 3Y0.46%
5. Dividend
5.1 Amount
WPP has a Yearly Dividend Yield of 5.23%, which is a nice return.
Compared to an average industry Dividend Yield of 4.48, 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 2.29, WPP pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.23% |
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.
WPP's earnings and Dividend Rate are declining. This means the current dividend is most likely not sustainable.
DP207.87%
EPS Next 2Y-1.77%
EPS Next 3Y0.46%
NYSE:WPP (2/21/2025, 8:04:00 PM)
47.47
-0.15 (-0.31%)
Chartmill FA Rating
GICS SectorCommunication Services
GICS IndustryGroupMedia & Entertainment
GICS IndustryMedia
Earnings (Last)
Earnings (Next)
Inst Owners68.91%
Inst Owner Change-4.22%
Ins Owners0.18%
Ins Owner Change0%
Market Cap10.24B
Analysts70.4
Price Target55 (15.86%)
Short Float %0.17%
Short Ratio1.98
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.23% |
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)-0.3%
PT rev (3m)-0.41%
EPS NQ rev (1m)N/A
EPS NQ rev (3m)N/A
EPS NY rev (1m)-0.91%
EPS NY rev (3m)-0.94%
Revenue NQ rev (1m)N/A
Revenue NQ rev (3m)N/A
Revenue NY rev (1m)0.05%
Revenue NY rev (3m)-0.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 8.11 | ||
| Fwd PE | 8.22 | ||
| P/S | 0.55 | ||
| P/FCF | 9.1 | ||
| P/OCF | 7.3 | ||
| P/B | 2.32 | ||
| P/tB | N/A | ||
| EV/EBITDA | 7.43 |
EPS(TTM)5.85
EY12.32%
EPS(NY)5.78
Fwd EY12.17%
FCF(TTM)5.22
FCFY10.99%
OCF(TTM)6.5
OCFY13.7%
SpS86.82
BVpS20.45
TBVpS-32.98
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 | 1.01 |
F-Score7
WACC6.39%
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-6.5%
EPS Next 2Y-1.77%
EPS Next 3Y0.46%
EPS Next 5Y-2.34%
Revenue 1Y (TTM)-0.3%
Revenue growth 3Y7.34%
Revenue growth 5Y2.62%
Sales Q2Q%0.08%
Revenue Next Year-1.71%
Revenue Next 2Y-0.89%
Revenue Next 3Y0.57%
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%