WALGREENS BOOTS ALLIANCE INC (WBA) Stock Fundamental Analysis
NASDAQ:WBA - US9314271084 - Common Stock
12.07 USD
-0.12 (-0.98%)
12.0201 USD
-0.05 (-0.41%)
We assign a fundamental rating of 3 out of 10 to WBA. WBA was compared to 40 industry peers in the Consumer Staples Distribution & Retail industry. Both the profitability and financial health of WBA have multiple concerns. WBA is valued quite cheap, but it does not seem to be growing.
1. Profitability
1.1 Basic Checks
WBA had positive earnings in the past year.
In the past year WBA had a positive cash flow from operations.
In multiple years WBA reported negative net income over the last 5 years.
WBA 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 -9.07%, WBA is doing worse than 80.00% of the companies in the same industry.
The Return On Equity of WBA (-87.68%) is worse than 87.50% of its industry peers.
WBA's Return On Invested Capital of 6.21% is in line compared to the rest of the industry. WBA outperforms 55.00% of its industry peers.
WBA had an Average Return On Invested Capital over the past 3 years of 3.98%. This is below the industry average of 8.22%.
The 3 year average ROIC (3.98%) for WBA is below the current ROIC(6.21%), indicating increased profibility in the last year.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -9.07% | ||
| ROE | -87.68% | ||
| ROIC | 6.21% |
ROA(3y)-3.01%
ROA(5y)-1.08%
ROE(3y)-26.97%
ROE(5y)-13.57%
ROIC(3y)3.98%
ROIC(5y)4.68%
1.3 Margins
WBA has a Operating Margin (2.21%) which is comparable to the rest of the industry.
In the last couple of years the Operating Margin of WBA has declined.
With a Gross Margin value of 17.13%, WBA is not doing good in the industry: 75.00% of the companies in the same industry are doing better.
WBA's Gross Margin has declined in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 2.21% | ||
| PM (TTM) | N/A | ||
| GM | 17.13% |
OM growth 3Y-19.96%
OM growth 5Y-19.55%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-5.34%
GM growth 5Y-5.19%
2. Health
2.1 Basic Checks
The Return on Invested Capital (ROIC) is below the Cost of Capital (WACC), so WBA is destroying value.
Compared to 1 year ago, WBA has about the same amount of shares outstanding.
WBA has less shares outstanding than it did 5 years ago.
The debt/assets ratio for WBA is higher compared to a year ago.
2.2 Solvency
An Altman-Z score of 2.71 indicates that WBA is not a great score, but indicates only limited risk for bankruptcy at the moment.
The Altman-Z score of WBA (2.71) is worse than 67.50% of its industry peers.
WBA has a debt to FCF ratio of 14.38. This is a negative value and a sign of low solvency as WBA would need 14.38 years to pay back of all of its debts.
WBA has a Debt to FCF ratio of 14.38. This is in the lower half of the industry: WBA underperforms 65.00% of its industry peers.
A Debt/Equity ratio of 1.09 is on the high side and indicates that WBA has dependencies on debt financing.
WBA has a worse Debt to Equity ratio (1.09) than 67.50% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.09 | ||
| Debt/FCF | 14.38 | ||
| Altman-Z | 2.71 |
ROIC/WACC0.84
WACC7.37%
2.3 Liquidity
WBA has a Current Ratio of 0.60. This is a bad value and indicates that WBA is not financially healthy enough and could expect problems in meeting its short term obligations.
WBA has a Current ratio of 0.60. This is amonst the worse of the industry: WBA underperforms 90.00% of its industry peers.
WBA has a Quick Ratio of 0.60. This is a bad value and indicates that WBA is not financially healthy enough and could expect problems in meeting its short term obligations.
WBA has a Quick ratio of 0.32. This is in the lower half of the industry: WBA underperforms 70.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.6 | ||
| Quick Ratio | 0.32 |
3. Growth
3.1 Past
The earnings per share for WBA have decreased strongly by -39.56% in the last year.
WBA shows a very negative growth in Earnings Per Share. Measured over the last years, the EPS has been decreasing by -13.65% yearly.
The Revenue has been growing slightly by 6.22% in the past year.
WBA shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.22% yearly.
EPS 1Y (TTM)-39.56%
EPS 3Y-16.96%
EPS 5Y-13.65%
EPS Q2Q%-39.68%
Revenue 1Y (TTM)6.22%
Revenue growth 3Y3.67%
Revenue growth 5Y4.22%
Sales Q2Q%7.25%
3.2 Future
Based on estimates for the next years, WBA will show a decrease in Earnings Per Share. The EPS will decrease by -4.88% on average per year.
Based on estimates for the next years, WBA will show a small growth in Revenue. The Revenue will grow by 1.96% on average per year.
EPS Next Y-39.2%
EPS Next 2Y-27.15%
EPS Next 3Y-19.36%
EPS Next 5Y-4.88%
Revenue Next Year6.03%
Revenue Next 2Y3.77%
Revenue Next 3Y3.43%
Revenue Next 5Y1.96%
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.
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
A Price/Earnings ratio of 6.32 indicates a rather cheap valuation of WBA.
Based on the Price/Earnings ratio, WBA is valued cheaply inside the industry as 95.00% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 27.24. WBA is valued rather cheaply when compared to this.
The Price/Forward Earnings ratio is 7.90, which indicates a rather cheap valuation of WBA.
97.50% of the companies in the same industry are more expensive than WBA, based on the Price/Forward Earnings ratio.
Compared to an average S&P500 Price/Forward Earnings ratio of 35.82, WBA is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 6.32 | ||
| Fwd PE | 7.9 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, WBA is valued cheaper than 95.00% of the companies in the same industry.
72.50% of the companies in the same industry are more expensive than WBA, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 18.04 | ||
| EV/EBITDA | 3.07 |
4.3 Compensation for Growth
WBA's earnings are expected to decrease with -19.36% in the coming years. This may justify a cheaper valuation.
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y-27.15%
EPS Next 3Y-19.36%
5. Dividend
5.1 Amount
WBA has a Yearly Dividend Yield of 2.07%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 1.93, WBA pays a better dividend. On top of this WBA pays more dividend than 97.50% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.32, WBA has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.07% |
5.2 History
The dividend of WBA decreases each year by -3.89%.
WBA has paid a dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)-3.89%
Div Incr Years0
Div Non Decr Years0
5.3 Sustainability
WBA has negative earnings and hence a negative payout ratio. The dividend may be in danger.
WBA's earnings and Dividend Rate are declining. This means the current dividend is most likely not sustainable.
DP-10.29%
EPS Next 2Y-27.15%
EPS Next 3Y-19.36%
12.07
-0.12 (-0.98%)
Chartmill FA Rating
GICS SectorConsumer Staples
GICS IndustryGroupConsumer Staples Distribution & Retail
GICS IndustryConsumer Staples Distribution & Retail
Earnings (Last)
Earnings (Next)
Inst Owners61.25%
Inst Owner Change-7.38%
Ins Owners0.64%
Ins Owner Change-9.3%
Market Cap10.45B
Analysts65.26
Price Target11.9 (-1.41%)
Short Float %3.23%
Short Ratio3.44
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.07% |
Yearly Dividend1.46
Dividend Growth(5Y)-3.89%
DP-10.29%
Div Incr Years0
Div Non Decr Years0
Ex-DateN/A
Surprises & Revisions
EPS beat(2)2
Avg EPS beat(2)14.62%
Min EPS beat(2)10.66%
Max EPS beat(2)18.59%
EPS beat(4)4
Avg EPS beat(4)18.04%
Min EPS beat(4)7.95%
Max EPS beat(4)34.95%
EPS beat(8)6
Avg EPS beat(8)14.1%
EPS beat(12)9
Avg EPS beat(12)9.44%
EPS beat(16)13
Avg EPS beat(16)10.5%
Revenue beat(2)2
Avg Revenue beat(2)2.66%
Min Revenue beat(2)0.55%
Max Revenue beat(2)4.78%
Revenue beat(4)4
Avg Revenue beat(4)3.47%
Min Revenue beat(4)0.55%
Max Revenue beat(4)4.78%
Revenue beat(8)8
Avg Revenue beat(8)2.68%
Revenue beat(12)12
Avg Revenue beat(12)2.29%
Revenue beat(16)16
Avg Revenue beat(16)2.04%
PT rev (1m)0.89%
PT rev (3m)-3.1%
EPS NQ rev (1m)4.6%
EPS NQ rev (3m)-0.76%
EPS NY rev (1m)0%
EPS NY rev (3m)2.41%
Revenue NQ rev (1m)-0.01%
Revenue NQ rev (3m)1.3%
Revenue NY rev (1m)0.23%
Revenue NY rev (3m)1.56%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 6.32 | ||
| Fwd PE | 7.9 | ||
| P/S | 0.07 | ||
| P/FCF | 18.04 | ||
| P/OCF | 6.63 | ||
| P/B | 1.45 | ||
| P/tB | N/A | ||
| EV/EBITDA | 3.07 |
EPS(TTM)1.91
EY15.82%
EPS(NY)1.53
Fwd EY12.66%
FCF(TTM)0.67
FCFY5.54%
OCF(TTM)1.82
OCFY15.09%
SpS178.59
BVpS8.3
TBVpS-17.96
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -9.07% | ||
| ROE | -87.68% | ||
| ROCE | 7.87% | ||
| ROIC | 6.21% | ||
| ROICexc | 6.34% | ||
| ROICexgc | 13.58% | ||
| OM | 2.21% | ||
| PM (TTM) | N/A | ||
| GM | 17.13% | ||
| FCFM | 0.37% |
ROA(3y)-3.01%
ROA(5y)-1.08%
ROE(3y)-26.97%
ROE(5y)-13.57%
ROIC(3y)3.98%
ROIC(5y)4.68%
ROICexc(3y)4.13%
ROICexc(5y)4.8%
ROICexgc(3y)9.14%
ROICexgc(5y)9.39%
ROCE(3y)5.04%
ROCE(5y)5.96%
ROICexcg growth 3Y-3.22%
ROICexcg growth 5Y-21.91%
ROICexc growth 3Y-13.35%
ROICexc growth 5Y-18.88%
OM growth 3Y-19.96%
OM growth 5Y-19.55%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-5.34%
GM growth 5Y-5.19%
F-Score4
Asset Turnover2.23
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.09 | ||
| Debt/FCF | 14.38 | ||
| Debt/EBITDA | 1.34 | ||
| Cap/Depr | 41.01% | ||
| Cap/Sales | 0.64% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 26.94% | ||
| Profit Quality | N/A | ||
| Current Ratio | 0.6 | ||
| Quick Ratio | 0.32 | ||
| Altman-Z | 2.71 |
F-Score4
WACC7.37%
ROIC/WACC0.84
Cap/Depr(3y)79.03%
Cap/Depr(5y)75.66%
Cap/Sales(3y)1.25%
Cap/Sales(5y)1.19%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-39.56%
EPS 3Y-16.96%
EPS 5Y-13.65%
EPS Q2Q%-39.68%
EPS Next Y-39.2%
EPS Next 2Y-27.15%
EPS Next 3Y-19.36%
EPS Next 5Y-4.88%
Revenue 1Y (TTM)6.22%
Revenue growth 3Y3.67%
Revenue growth 5Y4.22%
Sales Q2Q%7.25%
Revenue Next Year6.03%
Revenue Next 2Y3.77%
Revenue Next 3Y3.43%
Revenue Next 5Y1.96%
EBIT growth 1Y69.88%
EBIT growth 3Y-17.02%
EBIT growth 5Y-16.16%
EBIT Next Year41.78%
EBIT Next 3Y15.03%
EBIT Next 5Y27.82%
FCF growth 1Y170.44%
FCF growth 3YN/A
FCF growth 5YN/A
OCF growth 1Y20.86%
OCF growth 3Y-43.2%
OCF growth 5Y-28.88%