WILLIS TOWERS WATSON PLC (WTW) Stock Fundamental Analysis
USA - NASDAQ:WTW - IE00BDB6Q211 - Common Stock
315.05 USD
+0.17 (+0.05%)
315.05 USD
0 (0%)
WTW gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 147 industry peers in the Insurance industry. While WTW has a great profitability rating, there are some minor concerns on its financial health. WTW is valied quite expensively at the moment, while it does show a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year WTW was profitable.
In the past year WTW had a positive cash flow from operations.
WTW had positive earnings in 4 of the past 5 years.
Each year in the past 5 years WTW had a positive operating cash flow.
1.2 Ratios
The Return On Assets of WTW (7.71%) is better than 93.88% of its industry peers.
With an excellent Return On Equity value of 27.36%, WTW belongs to the best of the industry, outperforming 91.84% of the companies in the same industry.
Looking at the Return On Invested Capital, with a value of 12.62%, WTW belongs to the top of the industry, outperforming 96.60% of the companies in the same industry.
WTW had an Average Return On Invested Capital over the past 3 years of 8.90%. This is above the industry average of 4.37%.
The 3 year average ROIC (8.90%) for WTW is below the current ROIC(12.62%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.71% | ||
| ROE | 27.36% | ||
| ROIC | 12.62% |
ROA(3y)2.15%
ROA(5y)4.22%
ROE(3y)6.64%
ROE(5y)12.19%
ROIC(3y)8.9%
ROIC(5y)7.27%
1.3 Margins
Looking at the Profit Margin, with a value of 21.58%, WTW belongs to the top of the industry, outperforming 91.16% of the companies in the same industry.
Looking at the Operating Margin, with a value of 23.13%, WTW belongs to the top of the industry, outperforming 85.03% of the companies in the same industry.
WTW's Operating Margin has improved in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 23.13% | ||
| PM (TTM) | 21.58% | ||
| GM | N/A |
OM growth 3Y10.88%
OM growth 5Y11.06%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is just above the Cost of Capital (WACC), so WTW is still creating some value.
The number of shares outstanding for WTW has been reduced compared to 1 year ago.
The number of shares outstanding for WTW has been reduced compared to 5 years ago.
WTW has a worse debt/assets ratio than last year.
2.2 Solvency
WTW has an Altman-Z score of 1.60. This is a bad value and indicates that WTW is not financially healthy and even has some risk of bankruptcy.
The Altman-Z score of WTW (1.60) is better than 85.03% of its industry peers.
The Debt to FCF ratio of WTW is 3.85, which is a good value as it means it would take WTW, 3.85 years of fcf income to pay off all of its debts.
With a Debt to FCF ratio value of 3.85, WTW perfoms like the industry average, outperforming 43.54% of the companies in the same industry.
A Debt/Equity ratio of 0.62 indicates that WTW is somewhat dependend on debt financing.
WTW has a Debt to Equity ratio of 0.62. This is in the lower half of the industry: WTW underperforms 79.59% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 3.85 | ||
| Altman-Z | 1.6 |
ROIC/WACC1.49
WACC8.49%
2.3 Liquidity
A Current Ratio of 1.10 indicates that WTW should not have too much problems paying its short term obligations.
The Current ratio of WTW (1.10) is better than 80.27% of its industry peers.
A Quick Ratio of 1.10 indicates that WTW should not have too much problems paying its short term obligations.
The Quick ratio of WTW (1.10) is better than 80.27% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.1 | ||
| Quick Ratio | 1.1 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 6.05% over the past year.
WTW shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.03% yearly.
The Revenue has decreased by -0.02% in the past year.
The Revenue has been growing slightly by 3.48% on average over the past years.
EPS 1Y (TTM)6.05%
EPS 3Y7.25%
EPS 5Y9.03%
EPS Q2Q%4.78%
Revenue 1Y (TTM)-0.02%
Revenue growth 3Y3.34%
Revenue growth 5Y3.48%
Sales Q2Q%-0.04%
3.2 Future
The Earnings Per Share is expected to grow by 9.39% on average over the next years. This is quite good.
WTW is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 2.99% yearly.
EPS Next Y1.43%
EPS Next 2Y7.39%
EPS Next 3Y9.86%
EPS Next 5Y9.39%
Revenue Next Year-2.75%
Revenue Next 2Y1.58%
Revenue Next 3Y3.01%
Revenue Next 5Y2.99%
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 stable.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 18.33, the valuation of WTW can be described as rather expensive.
68.71% of the companies in the same industry are cheaper than WTW, based on the Price/Earnings ratio.
Compared to an average S&P500 Price/Earnings ratio of 25.45, WTW is valued a bit cheaper.
The Price/Forward Earnings ratio is 16.16, which indicates a correct valuation of WTW.
WTW's Price/Forward Earnings ratio is a bit more expensive when compared to the industry. WTW is more expensive than 64.63% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of WTW to the average of the S&P500 Index (34.46), we can say WTW is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.33 | ||
| Fwd PE | 16.16 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of WTW is on the same level as its industry peers.
64.63% of the companies in the same industry are cheaper than WTW, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.25 | ||
| EV/EBITDA | 12.7 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates WTW does not grow enough to justify the current Price/Earnings ratio.
WTW has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)12.82
PEG (5Y)2.03
EPS Next 2Y7.39%
EPS Next 3Y9.86%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 1.15%, WTW has a reasonable but not impressive dividend return.
WTW's Dividend Yield is comparable with the industry average which is at 3.51.
With a Dividend Yield of 1.15, WTW pays less dividend than the S&P500 average, which is at 2.45.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.15% |
5.2 History
On average, the dividend of WTW grows each year by 6.49%, which is quite nice.
WTW has paid a dividend for at least 10 years, which is a reliable track record.
WTW has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)6.49%
Div Incr Years8
Div Non Decr Years8
5.3 Sustainability
16.92% of the earnings are spent on dividend by WTW. This is a low number and sustainable payout ratio.
The dividend of WTW is growing, but earnings are growing more, so the dividend growth is sustainable.
DP16.92%
EPS Next 2Y7.39%
EPS Next 3Y9.86%
315.05
+0.17 (+0.05%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners97.59%
Inst Owner Change0%
Ins Owners0.28%
Ins Owner Change-0.38%
Market Cap30.73B
Revenue(TTM)9.81B
Net Income(TTM)2.12B
Analysts75.38
Price Target379.49 (20.45%)
Short Float %2.43%
Short Ratio3.9
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.15% |
Yearly Dividend3.5
Dividend Growth(5Y)6.49%
DP16.92%
Div Incr Years8
Div Non Decr Years8
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)4.31%
Min EPS beat(2)-0.42%
Max EPS beat(2)9.03%
EPS beat(4)2
Avg EPS beat(4)1.48%
Min EPS beat(4)-2.96%
Max EPS beat(4)9.03%
EPS beat(8)5
Avg EPS beat(8)3.13%
EPS beat(12)8
Avg EPS beat(12)1.8%
EPS beat(16)12
Avg EPS beat(16)2.06%
Revenue beat(2)1
Avg Revenue beat(2)-0.3%
Min Revenue beat(2)-0.82%
Max Revenue beat(2)0.22%
Revenue beat(4)1
Avg Revenue beat(4)-1.37%
Min Revenue beat(4)-3.05%
Max Revenue beat(4)0.22%
Revenue beat(8)1
Avg Revenue beat(8)-1.45%
Revenue beat(12)4
Avg Revenue beat(12)-0.68%
Revenue beat(16)4
Avg Revenue beat(16)-1.44%
PT rev (1m)2.43%
PT rev (3m)3.14%
EPS NQ rev (1m)0.33%
EPS NQ rev (3m)0.22%
EPS NY rev (1m)0.33%
EPS NY rev (3m)2.13%
Revenue NQ rev (1m)-0.24%
Revenue NQ rev (3m)-0.31%
Revenue NY rev (1m)0.08%
Revenue NY rev (3m)0.43%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.33 | ||
| Fwd PE | 16.16 | ||
| P/S | 3.13 | ||
| P/FCF | 22.25 | ||
| P/OCF | 19.17 | ||
| P/B | 3.97 | ||
| P/tB | N/A | ||
| EV/EBITDA | 12.7 |
EPS(TTM)17.19
EY5.46%
EPS(NY)19.49
Fwd EY6.19%
FCF(TTM)14.16
FCFY4.49%
OCF(TTM)16.43
OCFY5.22%
SpS100.53
BVpS79.29
TBVpS-24.46
PEG (NY)12.82
PEG (5Y)2.03
Graham Number175.12
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.71% | ||
| ROE | 27.36% | ||
| ROCE | 15.98% | ||
| ROIC | 12.62% | ||
| ROICexc | 14.6% | ||
| ROICexgc | 83.34% | ||
| OM | 23.13% | ||
| PM (TTM) | 21.58% | ||
| GM | N/A | ||
| FCFM | 14.08% |
ROA(3y)2.15%
ROA(5y)4.22%
ROE(3y)6.64%
ROE(5y)12.19%
ROIC(3y)8.9%
ROIC(5y)7.27%
ROICexc(3y)9.9%
ROICexc(5y)8.3%
ROICexgc(3y)46.83%
ROICexgc(5y)41.54%
ROCE(3y)11.27%
ROCE(5y)9.2%
ROICexgc growth 3Y11.06%
ROICexgc growth 5Y19.69%
ROICexc growth 3Y21.06%
ROICexc growth 5Y22.92%
OM growth 3Y10.88%
OM growth 5Y11.06%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
F-Score6
Asset Turnover0.36
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 3.85 | ||
| Debt/EBITDA | 1.78 | ||
| Cap/Depr | 53.49% | ||
| Cap/Sales | 2.26% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 59.75% | ||
| Profit Quality | 65.26% | ||
| Current Ratio | 1.1 | ||
| Quick Ratio | 1.1 | ||
| Altman-Z | 1.6 |
F-Score6
WACC8.49%
ROIC/WACC1.49
Cap/Depr(3y)45.88%
Cap/Depr(5y)41.14%
Cap/Sales(3y)2.44%
Cap/Sales(5y)2.57%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)6.05%
EPS 3Y7.25%
EPS 5Y9.03%
EPS Q2Q%4.78%
EPS Next Y1.43%
EPS Next 2Y7.39%
EPS Next 3Y9.86%
EPS Next 5Y9.39%
Revenue 1Y (TTM)-0.02%
Revenue growth 3Y3.34%
Revenue growth 5Y3.48%
Sales Q2Q%-0.04%
Revenue Next Year-2.75%
Revenue Next 2Y1.58%
Revenue Next 3Y3.01%
Revenue Next 5Y2.99%
EBIT growth 1Y11.67%
EBIT growth 3Y14.58%
EBIT growth 5Y14.92%
EBIT Next Year26.84%
EBIT Next 3Y14.35%
EBIT Next 5YN/A
FCF growth 1Y43.56%
FCF growth 3Y-12.01%
FCF growth 5Y10.3%
OCF growth 1Y33.81%
OCF growth 3Y-9.81%
OCF growth 5Y6.94%
WILLIS TOWERS WATSON PLC / WTW FAQ
Can you provide the ChartMill fundamental rating for WILLIS TOWERS WATSON PLC?
ChartMill assigns a fundamental rating of 5 / 10 to WTW.
What is the valuation status of WILLIS TOWERS WATSON PLC (WTW) stock?
ChartMill assigns a valuation rating of 2 / 10 to WILLIS TOWERS WATSON PLC (WTW). This can be considered as Overvalued.
Can you provide the profitability details for WILLIS TOWERS WATSON PLC?
WILLIS TOWERS WATSON PLC (WTW) has a profitability rating of 7 / 10.
What are the PE and PB ratios of WILLIS TOWERS WATSON PLC (WTW) stock?
The Price/Earnings (PE) ratio for WILLIS TOWERS WATSON PLC (WTW) is 18.33 and the Price/Book (PB) ratio is 3.97.
What is the financial health of WILLIS TOWERS WATSON PLC (WTW) stock?
The financial health rating of WILLIS TOWERS WATSON PLC (WTW) is 5 / 10.