WENDY'S CO/THE (WEN) Stock Fundamental Analysis
USA - NASDAQ:WEN - US95058W1009 - Common Stock
8.93 USD
+0.05 (+0.56%)
8.99 USD
+0.06 (+0.67%)
Taking everything into account, WEN scores 5 out of 10 in our fundamental rating. WEN was compared to 134 industry peers in the Hotels, Restaurants & Leisure industry. WEN has an excellent profitability rating, but there are concerns on its financial health. WEN has a bad growth rate and is valued cheaply.
1. Profitability
1.1 Basic Checks
WEN had positive earnings in the past year.
In the past year WEN had a positive cash flow from operations.
WEN had positive earnings in each of the past 5 years.
In the past 5 years WEN always reported a positive cash flow from operatings.
1.2 Ratios
WEN has a Return On Assets of 3.92%. This is comparable to the rest of the industry: WEN outperforms 58.96% of its industry peers.
Looking at the Return On Equity, with a value of 170.14%, WEN belongs to the top of the industry, outperforming 99.25% of the companies in the same industry.
The Return On Invested Capital of WEN (6.16%) is comparable to the rest of the industry.
WEN had an Average Return On Invested Capital over the past 3 years of 5.43%. This is significantly below the industry average of 10.67%.
The 3 year average ROIC (5.43%) for WEN is below the current ROIC(6.16%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.92% | ||
| ROE | 170.14% | ||
| ROIC | 6.16% |
ROA(3y)3.68%
ROA(5y)3.46%
ROE(3y)59.67%
ROE(5y)49.27%
ROIC(3y)5.43%
ROIC(5y)5.17%
1.3 Margins
With a decent Profit Margin value of 8.63%, WEN is doing good in the industry, outperforming 69.40% of the companies in the same industry.
WEN's Profit Margin has improved in the last couple of years.
Looking at the Operating Margin, with a value of 17.15%, WEN is in the better half of the industry, outperforming 74.63% of the companies in the same industry.
In the last couple of years the Operating Margin of WEN has remained more or less at the same level.
WEN has a Gross Margin of 63.17%. This is in the better half of the industry: WEN outperforms 76.87% of its industry peers.
WEN's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 17.15% | ||
| PM (TTM) | 8.63% | ||
| GM | 63.17% |
OM growth 3Y-1.47%
OM growth 5Y0.74%
PM growth 3Y-6.44%
PM growth 5Y1.55%
GM growth 3Y-1.04%
GM growth 5Y0.27%
2. Health
2.1 Basic Checks
WEN has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
WEN has less shares outstanding than it did 1 year ago.
WEN has less shares outstanding than it did 5 years ago.
The debt/assets ratio for WEN is higher compared to a year ago.
2.2 Solvency
WEN has an Altman-Z score of 1.09. This is a bad value and indicates that WEN is not financially healthy and even has some risk of bankruptcy.
WEN's Altman-Z score of 1.09 is on the low side compared to the rest of the industry. WEN is outperformed by 64.93% of its industry peers.
The Debt to FCF ratio of WEN is 13.03, which is on the high side as it means it would take WEN, 13.03 years of fcf income to pay off all of its debts.
WEN's Debt to FCF ratio of 13.03 is in line compared to the rest of the industry. WEN outperforms 51.49% of its industry peers.
WEN has a Debt/Equity ratio of 28.74. This is a high value indicating a heavy dependency on external financing.
WEN has a Debt to Equity ratio of 28.74. This is in the lower half of the industry: WEN underperforms 69.40% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 28.74 | ||
| Debt/FCF | 13.03 | ||
| Altman-Z | 1.09 |
ROIC/WACC0.93
WACC6.62%
2.3 Liquidity
A Current Ratio of 1.45 indicates that WEN should not have too much problems paying its short term obligations.
WEN has a better Current ratio (1.45) than 70.90% of its industry peers.
A Quick Ratio of 1.43 indicates that WEN should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.43, WEN is in the better half of the industry, outperforming 73.88% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.45 | ||
| Quick Ratio | 1.43 |
3. Growth
3.1 Past
WEN shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 1.02%.
WEN shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 11.13% yearly.
The Revenue has been growing slightly by 1.31% in the past year.
WEN shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 5.62% yearly.
EPS 1Y (TTM)1.02%
EPS 3Y6.84%
EPS 5Y11.13%
EPS Q2Q%7.41%
Revenue 1Y (TTM)1.31%
Revenue growth 3Y5.8%
Revenue growth 5Y5.62%
Sales Q2Q%-1.72%
3.2 Future
WEN is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.17% yearly.
The Revenue is expected to grow by 2.19% on average over the next years.
EPS Next Y-12.92%
EPS Next 2Y-2.54%
EPS Next 3Y1.81%
EPS Next 5Y7.17%
Revenue Next Year-3.95%
Revenue Next 2Y-0.44%
Revenue Next 3Y0.5%
Revenue Next 5Y2.19%
3.3 Evolution
The EPS growth rate is decreasing: in the next years the growth will be less than in the last years.
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
WEN is valuated reasonably with a Price/Earnings ratio of 9.02.
Compared to the rest of the industry, the Price/Earnings ratio of WEN indicates a rather cheap valuation: WEN is cheaper than 94.78% of the companies listed in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 27.69, WEN is valued rather cheaply.
The Price/Forward Earnings ratio is 9.40, which indicates a very decent valuation of WEN.
Based on the Price/Forward Earnings ratio, WEN is valued cheaper than 89.55% of the companies in the same industry.
When comparing the Price/Forward Earnings ratio of WEN to the average of the S&P500 Index (23.18), we can say WEN is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.02 | ||
| Fwd PE | 9.4 |
4.2 Price Multiples
WEN's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. WEN is cheaper than 72.39% of the companies in the same industry.
96.27% of the companies in the same industry are more expensive than WEN, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 6.62 | ||
| EV/EBITDA | 8.81 |
4.3 Compensation for Growth
The decent profitability rating of WEN may justify a higher PE ratio.
PEG (NY)N/A
PEG (5Y)0.81
EPS Next 2Y-2.54%
EPS Next 3Y1.81%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 6.31%, WEN is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.84, WEN pays a better dividend. On top of this WEN pays more dividend than 96.27% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.34, WEN pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.31% |
5.2 History
On average, the dividend of WEN grows each year by 32.37%, which is quite nice.
WEN has paid a dividend for at least 10 years, which is a reliable track record.
WEN has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)32.37%
Div Incr Years0
Div Non Decr Years4
5.3 Sustainability
92.71% of the earnings are spent on dividend by WEN. This is not a sustainable payout ratio.
WEN's earnings are growing slower than its dividend. This means the dividend growth is not sustainable.
DP92.71%
EPS Next 2Y-2.54%
EPS Next 3Y1.81%
8.93
+0.05 (+0.56%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners98.47%
Inst Owner Change-0.59%
Ins Owners8.86%
Ins Owner Change0.55%
Market Cap1.70B
Analysts63.03
Price Target11.39 (27.55%)
Short Float %12.56%
Short Ratio2.96
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 6.31% |
Yearly Dividend1
Dividend Growth(5Y)32.37%
DP92.71%
Div Incr Years0
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)6.16%
Min EPS beat(2)-0.22%
Max EPS beat(2)12.55%
EPS beat(4)2
Avg EPS beat(4)3.16%
Min EPS beat(4)-1.97%
Max EPS beat(4)12.55%
EPS beat(8)4
Avg EPS beat(8)1.42%
EPS beat(12)8
Avg EPS beat(12)2.26%
EPS beat(16)11
Avg EPS beat(16)2.12%
Revenue beat(2)0
Avg Revenue beat(2)-0.96%
Min Revenue beat(2)-1.35%
Max Revenue beat(2)-0.56%
Revenue beat(4)2
Avg Revenue beat(4)-0.23%
Min Revenue beat(4)-1.35%
Max Revenue beat(4)0.88%
Revenue beat(8)2
Avg Revenue beat(8)-1.14%
Revenue beat(12)3
Avg Revenue beat(12)-1.13%
Revenue beat(16)4
Avg Revenue beat(16)-1.05%
PT rev (1m)-2.26%
PT rev (3m)-19.45%
EPS NQ rev (1m)-0.81%
EPS NQ rev (3m)-21.33%
EPS NY rev (1m)-0.64%
EPS NY rev (3m)-9.38%
Revenue NQ rev (1m)-0.39%
Revenue NQ rev (3m)-4.32%
Revenue NY rev (1m)-0.23%
Revenue NY rev (3m)-2.39%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 9.02 | ||
| Fwd PE | 9.4 | ||
| P/S | 0.76 | ||
| P/FCF | 6.62 | ||
| P/OCF | 4.78 | ||
| P/B | 15.08 | ||
| P/tB | N/A | ||
| EV/EBITDA | 8.81 |
EPS(TTM)0.99
EY11.09%
EPS(NY)0.95
Fwd EY10.64%
FCF(TTM)1.35
FCFY15.09%
OCF(TTM)1.87
OCFY20.91%
SpS11.68
BVpS0.59
TBVpS-9.63
PEG (NY)N/A
PEG (5Y)0.81
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.92% | ||
| ROE | 170.14% | ||
| ROCE | 8.52% | ||
| ROIC | 6.16% | ||
| ROICexc | 6.57% | ||
| ROICexgc | 12.26% | ||
| OM | 17.15% | ||
| PM (TTM) | 8.63% | ||
| GM | 63.17% | ||
| FCFM | 11.54% |
ROA(3y)3.68%
ROA(5y)3.46%
ROE(3y)59.67%
ROE(5y)49.27%
ROIC(3y)5.43%
ROIC(5y)5.17%
ROICexc(3y)6.13%
ROICexc(5y)5.72%
ROICexgc(3y)11.48%
ROICexgc(5y)10.67%
ROCE(3y)7.51%
ROCE(5y)7.16%
ROICexcg growth 3Y6.48%
ROICexcg growth 5Y7.52%
ROICexc growth 3Y6.19%
ROICexc growth 5Y7.2%
OM growth 3Y-1.47%
OM growth 5Y0.74%
PM growth 3Y-6.44%
PM growth 5Y1.55%
GM growth 3Y-1.04%
GM growth 5Y0.27%
F-Score6
Asset Turnover0.45
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 28.74 | ||
| Debt/FCF | 13.03 | ||
| Debt/EBITDA | 5.99 | ||
| Cap/Depr | 62% | ||
| Cap/Sales | 4.45% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 65.75% | ||
| Profit Quality | 133.75% | ||
| Current Ratio | 1.45 | ||
| Quick Ratio | 1.43 | ||
| Altman-Z | 1.09 |
F-Score6
WACC6.62%
ROIC/WACC0.93
Cap/Depr(3y)59.99%
Cap/Depr(5y)58.81%
Cap/Sales(3y)4.06%
Cap/Sales(5y)4.05%
Profit Quality(3y)119.97%
Profit Quality(5y)135.28%
High Growth Momentum
Growth
EPS 1Y (TTM)1.02%
EPS 3Y6.84%
EPS 5Y11.13%
EPS Q2Q%7.41%
EPS Next Y-12.92%
EPS Next 2Y-2.54%
EPS Next 3Y1.81%
EPS Next 5Y7.17%
Revenue 1Y (TTM)1.31%
Revenue growth 3Y5.8%
Revenue growth 5Y5.62%
Sales Q2Q%-1.72%
Revenue Next Year-3.95%
Revenue Next 2Y-0.44%
Revenue Next 3Y0.5%
Revenue Next 5Y2.19%
EBIT growth 1Y2.22%
EBIT growth 3Y4.25%
EBIT growth 5Y6.41%
EBIT Next Year37.36%
EBIT Next 3Y13.87%
EBIT Next 5Y10.94%
FCF growth 1Y17.59%
FCF growth 3Y-0.86%
FCF growth 5Y4.01%
OCF growth 1Y17.36%
OCF growth 3Y0.91%
OCF growth 5Y4.22%