WILLIS TOWERS WATSON PLC (WTW) Stock Fundamental Analysis
USA - NASDAQ:WTW - IE00BDB6Q211 - Common Stock
322.13 USD
-2.17 (-0.67%)
322.13 USD
0 (0%)
We assign a fundamental rating of 5 out of 10 to WTW. WTW was compared to 146 industry peers in the Insurance industry. WTW has an excellent profitability rating, but 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
WTW had positive earnings in the past year.
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
With an excellent Return On Assets value of 7.71%, WTW belongs to the best of the industry, outperforming 93.84% of the companies in the same industry.
WTW has a better Return On Equity (27.36%) than 91.78% of its industry peers.
The Return On Invested Capital of WTW (12.62%) is better than 96.58% of its industry peers.
WTW had an Average Return On Invested Capital over the past 3 years of 8.90%. This is above the industry average of 4.51%.
The last Return On Invested Capital (12.62%) for WTW is above the 3 year average (8.90%), which is a sign of increasing profitability.
| 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
With an excellent Profit Margin value of 21.58%, WTW belongs to the best of the industry, outperforming 91.10% of the companies in the same industry.
WTW has a better Operating Margin (23.13%) than 84.25% of its industry peers.
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
WTW has a Return on Invested Capital (ROIC), which is just above the Cost of Capital (WACC), which means it is creating some value.
The number of shares outstanding for WTW has been reduced compared to 1 year ago.
WTW has less shares outstanding than it did 5 years ago.
Compared to 1 year ago, WTW has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.62, we must say that WTW is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.62, WTW belongs to the top of the industry, outperforming 85.62% of the companies in the same industry.
WTW has a debt to FCF ratio of 3.85. This is a good value and a sign of high solvency as WTW would need 3.85 years to pay back of all of its debts.
With a Debt to FCF ratio value of 3.85, WTW perfoms like the industry average, outperforming 45.89% of the companies in the same industry.
WTW has a Debt/Equity ratio of 0.62. This is a neutral value indicating WTW is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.62, WTW is doing worse than 78.77% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 3.85 | ||
| Altman-Z | 1.62 |
ROIC/WACC1.48
WACC8.51%
2.3 Liquidity
A Current Ratio of 1.10 indicates that WTW should not have too much problems paying its short term obligations.
Looking at the Current ratio, with a value of 1.10, WTW belongs to the top of the industry, outperforming 80.14% of the companies in the same industry.
A Quick Ratio of 1.10 indicates that WTW should not have too much problems paying its short term obligations.
WTW has a Quick ratio of 1.10. This is amongst the best in the industry. WTW outperforms 80.14% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.1 | ||
| Quick Ratio | 1.1 |
3. Growth
3.1 Past
WTW shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 6.05%.
The Earnings Per Share has been growing by 9.03% on average over the past years. This is quite good.
WTW shows a decrease in Revenue. In the last year, the revenue decreased by -0.02%.
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
Based on estimates for the next years, WTW will show a quite strong growth in Earnings Per Share. The EPS will grow by 9.39% on average per year.
The Revenue is expected to grow by 2.99% on average over the next years.
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
The EPS growth rate is stable: in the next years the growth will be about the same 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.
4. Valuation
4.1 Price/Earnings Ratio
The Price/Earnings ratio is 18.74, which indicates a rather expensive current valuation of WTW.
WTW's Price/Earnings ratio is a bit more expensive when compared to the industry. WTW is more expensive than 67.81% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 25.89, WTW is valued a bit cheaper.
A Price/Forward Earnings ratio of 16.53 indicates a correct valuation of WTW.
Based on the Price/Forward Earnings ratio, WTW is valued a bit more expensive than 64.38% of the companies in the same industry.
WTW's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 34.59.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.74 | ||
| Fwd PE | 16.53 |
4.2 Price Multiples
WTW's Enterprise Value to EBITDA is on the same level as the industry average.
Based on the Price/Free Cash Flow ratio, WTW is valued a bit more expensive than 63.01% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.75 | ||
| EV/EBITDA | 13.04 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
WTW has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)13.11
PEG (5Y)2.08
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 3.47.
Compared to an average S&P500 Dividend Yield of 2.36, WTW's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.15% |
5.2 History
The dividend of WTW is nicely growing with an annual growth rate of 6.49%!
WTW has paid a dividend for at least 10 years, which is a reliable track record.
As WTW did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)6.49%
Div Incr Years8
Div Non Decr Years8
5.3 Sustainability
WTW pays out 16.92% of its income as dividend. This is a sustainable payout ratio.
WTW's earnings are growing more than its dividend. This makes the dividend growth sustainable.
DP16.92%
EPS Next 2Y7.39%
EPS Next 3Y9.86%
322.13
-2.17 (-0.67%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners97.59%
Inst Owner Change0%
Ins Owners0.28%
Ins Owner Change0.08%
Market Cap31.42B
Revenue(TTM)9.81B
Net Income(TTM)2.12B
Analysts75.38
Price Target379.49 (17.81%)
Short Float %2.6%
Short Ratio5.09
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)0.43%
EPS NQ rev (3m)1.04%
EPS NY rev (1m)0.33%
EPS NY rev (3m)2.13%
Revenue NQ rev (1m)-0.14%
Revenue NQ rev (3m)-0.21%
Revenue NY rev (1m)0.08%
Revenue NY rev (3m)0.43%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.74 | ||
| Fwd PE | 16.53 | ||
| P/S | 3.2 | ||
| P/FCF | 22.75 | ||
| P/OCF | 19.6 | ||
| P/B | 4.06 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.04 |
EPS(TTM)17.19
EY5.34%
EPS(NY)19.49
Fwd EY6.05%
FCF(TTM)14.16
FCFY4.39%
OCF(TTM)16.43
OCFY5.1%
SpS100.53
BVpS79.29
TBVpS-24.46
PEG (NY)13.11
PEG (5Y)2.08
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 | 1.62 |
F-Score6
WACC8.51%
ROIC/WACC1.48
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 18.74 and the Price/Book (PB) ratio is 4.06.
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.