RESTAURANT BRANDS INTERN (QSR) Stock Fundamental Analysis
NYSE:QSR - New York Stock Exchange, Inc. - CA76131D1033 - Common Stock - Currency: USD
Overall QSR gets a fundamental rating of 4 out of 10. We evaluated QSR against 131 industry peers in the Hotels, Restaurants & Leisure industry. There are concerns on the financial health of QSR while its profitability can be described as average. QSR is not valued too expensively and it also shows a decent growth rate.
1. Profitability
1.1 Basic Checks
In the past year QSR was profitable.
QSR had a positive operating cash flow in the past year.
QSR had positive earnings in each of the past 5 years.
In the past 5 years QSR always reported a positive cash flow from operatings.
1.2 Ratios
QSR has a Return On Assets (3.82%) which is comparable to the rest of the industry.
Looking at the Return On Equity, with a value of 30.49%, QSR belongs to the top of the industry, outperforming 84.73% of the companies in the same industry.
With a decent Return On Invested Capital value of 8.29%, QSR is doing good in the industry, outperforming 66.41% of the companies in the same industry.
The Average Return On Invested Capital over the past 3 years for QSR is significantly below the industry average of 15.91%.
The 3 year average ROIC (8.03%) for QSR is below the current ROIC(8.29%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.82% | ||
| ROE | 30.49% | ||
| ROIC | 8.29% |
ROA(3y)4.55%
ROA(5y)3.88%
ROE(3y)38.23%
ROE(5y)34.92%
ROIC(3y)8.03%
ROIC(5y)7.44%
1.3 Margins
The Profit Margin of QSR (10.82%) is better than 77.10% of its industry peers.
In the last couple of years the Profit Margin of QSR has remained more or less at the same level.
Looking at the Operating Margin, with a value of 26.31%, QSR belongs to the top of the industry, outperforming 92.37% of the companies in the same industry.
QSR's Operating Margin has declined in the last couple of years.
Looking at the Gross Margin, with a value of 56.03%, QSR is in the better half of the industry, outperforming 68.70% of the companies in the same industry.
In the last couple of years the Gross Margin of QSR has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 26.31% | ||
| PM (TTM) | 10.82% | ||
| GM | 56.03% |
OM growth 3Y-5.89%
OM growth 5Y-5.16%
PM growth 3Y-5.95%
PM growth 5Y1.14%
GM growth 3Y-4.56%
GM growth 5Y-2.9%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), QSR is destroying value.
Compared to 1 year ago, QSR has more shares outstanding
QSR has more shares outstanding than it did 5 years ago.
The debt/assets ratio for QSR has remained at the same level compared to a year ago.
2.2 Solvency
QSR has an Altman-Z score of 1.34. This is a bad value and indicates that QSR is not financially healthy and even has some risk of bankruptcy.
QSR has a Altman-Z score of 1.34. This is comparable to the rest of the industry: QSR outperforms 43.51% of its industry peers.
QSR has a debt to FCF ratio of 12.37. This is a negative value and a sign of low solvency as QSR would need 12.37 years to pay back of all of its debts.
QSR's Debt to FCF ratio of 12.37 is in line compared to the rest of the industry. QSR outperforms 54.20% of its industry peers.
A Debt/Equity ratio of 4.40 is on the high side and indicates that QSR has dependencies on debt financing.
With a Debt to Equity ratio value of 4.40, QSR perfoms like the industry average, outperforming 40.46% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.4 | ||
| Debt/FCF | 12.37 | ||
| Altman-Z | 1.34 |
ROIC/WACC0.97
WACC8.54%
2.3 Liquidity
QSR has a Current Ratio of 0.96. This is a bad value and indicates that QSR is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Current ratio value of 0.96, QSR perfoms like the industry average, outperforming 53.44% of the companies in the same industry.
A Quick Ratio of 0.90 indicates that QSR may have some problems paying its short term obligations.
QSR has a Quick ratio (0.90) which is comparable to the rest of the industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.96 | ||
| Quick Ratio | 0.9 |
3. Growth
3.1 Past
QSR shows a small growth in Earnings Per Share. In the last year, the EPS has grown by 5.86%.
QSR shows a small growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 4.05% yearly.
Looking at the last year, QSR shows a quite strong growth in Revenue. The Revenue has grown by 19.71% in the last year.
QSR shows quite a strong growth in Revenue. Measured over the last years, the Revenue has been growing by 8.45% yearly.
EPS 1Y (TTM)5.86%
EPS 3Y5.7%
EPS 5Y4.05%
EPS Q2Q%9.3%
Revenue 1Y (TTM)19.71%
Revenue growth 3Y13.57%
Revenue growth 5Y8.45%
Sales Q2Q%15.87%
3.2 Future
The Earnings Per Share is expected to grow by 7.85% on average over the next years.
Based on estimates for the next years, QSR will show a small growth in Revenue. The Revenue will grow by 2.84% on average per year.
EPS Next Y11.66%
EPS Next 2Y10.5%
EPS Next 3Y9.86%
EPS Next 5Y7.85%
Revenue Next Year8.91%
Revenue Next 2Y6.09%
Revenue Next 3Y5.03%
Revenue Next 5Y2.84%
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 accelerating.
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
The Price/Earnings ratio is 18.99, which indicates a rather expensive current valuation of QSR.
Compared to the rest of the industry, the Price/Earnings ratio of QSR indicates a somewhat cheap valuation: QSR is cheaper than 70.23% of the companies listed in the same industry.
QSR is valuated rather cheaply when we compare the Price/Earnings ratio to 26.41, which is the current average of the S&P500 Index.
QSR is valuated correctly with a Price/Forward Earnings ratio of 16.02.
Based on the Price/Forward Earnings ratio, QSR is valued a bit cheaper than the industry average as 68.70% of the companies are valued more expensively.
QSR's Price/Forward Earnings ratio indicates a rather cheap valuation when compared to the S&P500 average which is at 33.87.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.99 | ||
| Fwd PE | 16.02 |
4.2 Price Multiples
Compared to the rest of the industry, the Enterprise Value to EBITDA ratio of QSR is on the same level as its industry peers.
QSR's Price/Free Cash Flow ratio is a bit cheaper when compared to the industry. QSR is cheaper than 79.39% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.94 | ||
| EV/EBITDA | 13.17 |
4.3 Compensation for Growth
QSR's PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates a correct valuation of the company.
QSR has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)1.63
PEG (5Y)4.69
EPS Next 2Y10.5%
EPS Next 3Y9.86%
5. Dividend
5.1 Amount
QSR has a Yearly Dividend Yield of 3.84%. Purely for dividend investing, there may be better candidates out there.
QSR's Dividend Yield is rather good when compared to the industry average which is at 4.00. QSR pays more dividend than 87.02% of the companies in the same industry.
QSR's Dividend Yield is rather good when compared to the S&P500 average which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.84% |
5.2 History
The dividend of QSR decreases each year by -6.89%.
QSR has been paying a dividend for at least 10 years, so it has a reliable track record.
As QSR did not decrease their dividend in the past 5 years, we can say the dividend looks stable.
Dividend Growth(5Y)-6.89%
Div Incr Years9
Div Non Decr Years9
5.3 Sustainability
110.11% of the earnings are spent on dividend by QSR. This is not a sustainable payout ratio.
DP110.11%
EPS Next 2Y10.5%
EPS Next 3Y9.86%
65.14
+0.64 (+0.99%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners91.85%
Inst Owner Change-0.17%
Ins Owners1.34%
Ins Owner Change11.51%
Market Cap21.34B
Analysts77.39
Price Target78.77 (20.92%)
Short Float %3.8%
Short Ratio4.18
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.84% |
Yearly Dividend2.29
Dividend Growth(5Y)-6.89%
DP110.11%
Div Incr Years9
Div Non Decr Years9
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)-1.57%
Min EPS beat(2)-5.14%
Max EPS beat(2)2.01%
EPS beat(4)1
Avg EPS beat(4)-1.93%
Min EPS beat(4)-5.14%
Max EPS beat(4)2.01%
EPS beat(8)5
Avg EPS beat(8)0.98%
EPS beat(12)8
Avg EPS beat(12)4.24%
EPS beat(16)12
Avg EPS beat(16)5.29%
Revenue beat(2)0
Avg Revenue beat(2)-0.91%
Min Revenue beat(2)-1.82%
Max Revenue beat(2)0%
Revenue beat(4)1
Avg Revenue beat(4)-0.43%
Min Revenue beat(4)-1.82%
Max Revenue beat(4)1.76%
Revenue beat(8)3
Avg Revenue beat(8)-0.42%
Revenue beat(12)7
Avg Revenue beat(12)0.34%
Revenue beat(16)10
Avg Revenue beat(16)0.58%
PT rev (1m)-0.57%
PT rev (3m)1.95%
EPS NQ rev (1m)0.09%
EPS NQ rev (3m)0.77%
EPS NY rev (1m)0%
EPS NY rev (3m)-1.5%
Revenue NQ rev (1m)0.17%
Revenue NQ rev (3m)0.04%
Revenue NY rev (1m)0.12%
Revenue NY rev (3m)-0.3%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.99 | ||
| Fwd PE | 16.02 | ||
| P/S | 2.43 | ||
| P/FCF | 18.94 | ||
| P/OCF | 15.62 | ||
| P/B | 6.85 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.17 |
EPS(TTM)3.43
EY5.27%
EPS(NY)4.07
Fwd EY6.24%
FCF(TTM)3.44
FCFY5.28%
OCF(TTM)4.17
OCFY6.4%
SpS26.79
BVpS9.51
TBVpS-42.47
PEG (NY)1.63
PEG (5Y)4.69
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.82% | ||
| ROE | 30.49% | ||
| ROCE | 10.38% | ||
| ROIC | 8.29% | ||
| ROICexc | 8.64% | ||
| ROICexgc | 42.65% | ||
| OM | 26.31% | ||
| PM (TTM) | 10.82% | ||
| GM | 56.03% | ||
| FCFM | 12.84% |
ROA(3y)4.55%
ROA(5y)3.88%
ROE(3y)38.23%
ROE(5y)34.92%
ROIC(3y)8.03%
ROIC(5y)7.44%
ROICexc(3y)8.51%
ROICexc(5y)7.9%
ROICexgc(3y)52.12%
ROICexgc(5y)49.93%
ROCE(3y)10.05%
ROCE(5y)9.31%
ROICexcg growth 3Y-4.66%
ROICexcg growth 5Y-3.62%
ROICexc growth 3Y5.76%
ROICexc growth 5Y1.01%
OM growth 3Y-5.89%
OM growth 5Y-5.16%
PM growth 3Y-5.95%
PM growth 5Y1.14%
GM growth 3Y-4.56%
GM growth 5Y-2.9%
F-Score5
Asset Turnover0.35
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 4.4 | ||
| Debt/FCF | 12.37 | ||
| Debt/EBITDA | 5.29 | ||
| Cap/Depr | 83.57% | ||
| Cap/Sales | 2.72% | ||
| Interest Coverage | 3.01 | ||
| Cash Conversion | 52.64% | ||
| Profit Quality | 118.63% | ||
| Current Ratio | 0.96 | ||
| Quick Ratio | 0.9 | ||
| Altman-Z | 1.34 |
F-Score5
WACC8.54%
ROIC/WACC0.97
Cap/Depr(3y)63.87%
Cap/Depr(5y)61.25%
Cap/Sales(3y)1.88%
Cap/Sales(5y)1.97%
Profit Quality(3y)122.17%
Profit Quality(5y)145.05%
High Growth Momentum
Growth
EPS 1Y (TTM)5.86%
EPS 3Y5.7%
EPS 5Y4.05%
EPS Q2Q%9.3%
EPS Next Y11.66%
EPS Next 2Y10.5%
EPS Next 3Y9.86%
EPS Next 5Y7.85%
Revenue 1Y (TTM)19.71%
Revenue growth 3Y13.57%
Revenue growth 5Y8.45%
Sales Q2Q%15.87%
Revenue Next Year8.91%
Revenue Next 2Y6.09%
Revenue Next 3Y5.03%
Revenue Next 5Y2.84%
EBIT growth 1Y6.21%
EBIT growth 3Y6.88%
EBIT growth 5Y2.85%
EBIT Next Year26.09%
EBIT Next 3Y13.39%
EBIT Next 5Y9.29%
FCF growth 1Y-9.33%
FCF growth 3Y-7.03%
FCF growth 5Y-1.64%
OCF growth 1Y1.11%
OCF growth 3Y-4.51%
OCF growth 5Y0.36%