WEC ENERGY GROUP INC (WEC) Stock Fundamental Analysis
NYSE:WEC - New York Stock Exchange, Inc. - US92939U1060 - Common Stock - Currency: USD
Overall WEC gets a fundamental rating of 5 out of 10. We evaluated WEC against 25 industry peers in the Multi-Utilities industry. While WEC has a great profitability rating, there are quite some concerns on its financial health. While showing a medium growth rate, WEC is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
In the past year WEC was profitable.
WEC had a positive operating cash flow in the past year.
Each year in the past 5 years WEC has been profitable.
Each year in the past 5 years WEC had a positive operating cash flow.
1.2 Ratios
WEC has a Return On Assets of 3.38%. This is amongst the best in the industry. WEC outperforms 100.00% of its industry peers.
WEC has a Return On Equity of 12.53%. This is amongst the best in the industry. WEC outperforms 84.00% of its industry peers.
The Return On Invested Capital of WEC (4.56%) is better than 92.00% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for WEC is in line with the industry average of 3.83%.
The last Return On Invested Capital (4.56%) for WEC is above the 3 year average (4.35%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.38% | ||
| ROE | 12.53% | ||
| ROIC | 4.56% |
ROA(3y)3.21%
ROA(5y)3.24%
ROE(3y)11.99%
ROE(5y)11.85%
ROIC(3y)4.35%
ROIC(5y)4.27%
1.3 Margins
WEC has a better Profit Margin (17.96%) than 92.00% of its industry peers.
In the last couple of years the Profit Margin of WEC has grown nicely.
WEC's Operating Margin of 25.24% is amongst the best of the industry. WEC outperforms 88.00% of its industry peers.
WEC's Operating Margin has improved in the last couple of years.
WEC has a Gross Margin of 68.08%. This is comparable to the rest of the industry: WEC outperforms 56.00% of its industry peers.
WEC's Gross Margin has been stable in the last couple of years.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 25.24% | ||
| PM (TTM) | 17.96% | ||
| GM | 68.08% |
OM growth 3Y6.87%
OM growth 5Y4.19%
PM growth 3Y4.33%
PM growth 5Y3.33%
GM growth 3Y4.72%
GM growth 5Y1.38%
2. Health
2.1 Basic Checks
WEC has a Return on Invested Capital (ROIC), which is below the Cost of Capital (WACC), which means it is destroying value.
Compared to 1 year ago, WEC has more shares outstanding
WEC has more shares outstanding than it did 5 years ago.
Compared to 1 year ago, WEC has a worse debt to assets ratio.
2.2 Solvency
WEC has an Altman-Z score of 1.10. This is a bad value and indicates that WEC is not financially healthy and even has some risk of bankruptcy.
With an excellent Altman-Z score value of 1.10, WEC belongs to the best of the industry, outperforming 84.00% of the companies in the same industry.
The Debt to FCF ratio of WEC is 54.98, which is on the high side as it means it would take WEC, 54.98 years of fcf income to pay off all of its debts.
WEC has a better Debt to FCF ratio (54.98) than 100.00% of its industry peers.
WEC has a Debt/Equity ratio of 1.37. This is a high value indicating a heavy dependency on external financing.
WEC's Debt to Equity ratio of 1.37 is in line compared to the rest of the industry. WEC outperforms 60.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.37 | ||
| Debt/FCF | 54.98 | ||
| Altman-Z | 1.1 |
ROIC/WACC0.64
WACC7.09%
2.3 Liquidity
A Current Ratio of 0.50 indicates that WEC may have some problems paying its short term obligations.
WEC has a worse Current ratio (0.50) than 96.00% of its industry peers.
A Quick Ratio of 0.40 indicates that WEC may have some problems paying its short term obligations.
WEC has a worse Quick ratio (0.40) than 96.00% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 0.5 | ||
| Quick Ratio | 0.4 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 4.01% over the past year.
Measured over the past 5 years, WEC shows a small growth in Earnings Per Share. The EPS has been growing by 6.44% on average per year.
Looking at the last year, WEC shows a small growth in Revenue. The Revenue has grown by 4.42% in the last year.
WEC shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 2.71% yearly.
EPS 1Y (TTM)4.01%
EPS 3Y5.96%
EPS 5Y6.44%
EPS Q2Q%15.23%
Revenue 1Y (TTM)4.42%
Revenue growth 3Y1.13%
Revenue growth 5Y2.71%
Sales Q2Q%17.51%
3.2 Future
WEC is expected to show a small growth in Earnings Per Share. In the coming years, the EPS will grow by 7.34% yearly.
Based on estimates for the next years, WEC will show a small growth in Revenue. The Revenue will grow by 5.51% on average per year.
EPS Next Y8.11%
EPS Next 2Y7.45%
EPS Next 3Y7.3%
EPS Next 5Y7.34%
Revenue Next Year4.08%
Revenue Next 2Y4.81%
Revenue Next 3Y4.99%
Revenue Next 5Y5.51%
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.
When comparing the Revenue growth rate of the last years to the growth rate of the upcoming years, we see that the growth is accelerating.
4. Valuation
4.1 Price/Earnings Ratio
WEC is valuated rather expensively with a Price/Earnings ratio of 20.57.
Based on the Price/Earnings ratio, WEC is valued a bit more expensive than 72.00% of the companies in the same industry.
Compared to an average S&P500 Price/Earnings ratio of 25.82, WEC is valued a bit cheaper.
WEC is valuated rather expensively with a Price/Forward Earnings ratio of 18.91.
Based on the Price/Forward Earnings ratio, WEC is valued expensively inside the industry as 84.00% of the companies are valued cheaper.
Compared to an average S&P500 Price/Forward Earnings ratio of 21.76, WEC is valued at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.57 | ||
| Fwd PE | 18.91 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, WEC is valued more expensive than 84.00% of the companies in the same industry.
96.00% of the companies in the same industry are more expensive than WEC, based on the Price/Free Cash Flow ratio.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 91.33 | ||
| EV/EBITDA | 14.49 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates WEC does not grow enough to justify the current Price/Earnings ratio.
The excellent profitability rating of WEC may justify a higher PE ratio.
PEG (NY)2.54
PEG (5Y)3.2
EPS Next 2Y7.45%
EPS Next 3Y7.3%
5. Dividend
5.1 Amount
WEC has a Yearly Dividend Yield of 3.35%. Purely for dividend investing, there may be better candidates out there.
WEC's Dividend Yield is comparable with the industry average which is at 3.67.
Compared to an average S&P500 Dividend Yield of 2.39, WEC pays a bit more dividend than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.35% |
5.2 History
The dividend of WEC is nicely growing with an annual growth rate of 7.17%!
WEC has been paying a dividend for at least 10 years, so it has a reliable track record.
WEC has not decreased their dividend for at least 10 years, which is a reliable track record.
Dividend Growth(5Y)7.17%
Div Incr Years21
Div Non Decr Years23
5.3 Sustainability
66.07% of the earnings are spent on dividend by WEC. This is not a sustainable payout ratio.
The dividend of WEC is growing around the same rate as the earnings are growing. If this keeps up the dividend growth is sustainable.
DP66.07%
EPS Next 2Y7.45%
EPS Next 3Y7.3%
106.78
+1.29 (+1.22%)
Chartmill FA Rating
GICS SectorUtilities
GICS IndustryGroupUtilities
GICS IndustryMulti-Utilities
Earnings (Last)
Earnings (Next)
Inst Owners83.18%
Inst Owner Change1.48%
Ins Owners0.15%
Ins Owner Change-0.82%
Market Cap34.08B
Analysts70
Price Target107.34 (0.52%)
Short Float %4.19%
Short Ratio5.6
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 3.35% |
Yearly Dividend3.34
Dividend Growth(5Y)7.17%
DP66.07%
Div Incr Years21
Div Non Decr Years23
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)1.39%
Min EPS beat(2)-0.36%
Max EPS beat(2)3.14%
EPS beat(4)3
Avg EPS beat(4)5.7%
Min EPS beat(4)-0.36%
Max EPS beat(4)15.6%
EPS beat(8)7
Avg EPS beat(8)5.15%
EPS beat(12)10
Avg EPS beat(12)5.27%
EPS beat(16)14
Avg EPS beat(16)6.09%
Revenue beat(2)1
Avg Revenue beat(2)-1.75%
Min Revenue beat(2)-13.9%
Max Revenue beat(2)10.39%
Revenue beat(4)1
Avg Revenue beat(4)-3.52%
Min Revenue beat(4)-13.9%
Max Revenue beat(4)10.39%
Revenue beat(8)1
Avg Revenue beat(8)-8.79%
Revenue beat(12)5
Avg Revenue beat(12)-0.96%
Revenue beat(16)9
Avg Revenue beat(16)1.73%
PT rev (1m)1.45%
PT rev (3m)2.73%
EPS NQ rev (1m)-13.13%
EPS NQ rev (3m)-16.69%
EPS NY rev (1m)-0.06%
EPS NY rev (3m)0.08%
Revenue NQ rev (1m)-0.05%
Revenue NQ rev (3m)-2.49%
Revenue NY rev (1m)0.83%
Revenue NY rev (3m)-0.09%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 20.57 | ||
| Fwd PE | 18.91 | ||
| P/S | 3.76 | ||
| P/FCF | 91.33 | ||
| P/OCF | 9.71 | ||
| P/B | 2.62 | ||
| P/tB | 3.43 | ||
| EV/EBITDA | 14.49 |
EPS(TTM)5.19
EY4.86%
EPS(NY)5.65
Fwd EY5.29%
FCF(TTM)1.17
FCFY1.09%
OCF(TTM)11
OCFY10.3%
SpS28.42
BVpS40.76
TBVpS31.1
PEG (NY)2.54
PEG (5Y)3.2
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.38% | ||
| ROE | 12.53% | ||
| ROCE | 5.4% | ||
| ROIC | 4.56% | ||
| ROICexc | 4.57% | ||
| ROICexgc | 4.91% | ||
| OM | 25.24% | ||
| PM (TTM) | 17.96% | ||
| GM | 68.08% | ||
| FCFM | 4.11% |
ROA(3y)3.21%
ROA(5y)3.24%
ROE(3y)11.99%
ROE(5y)11.85%
ROIC(3y)4.35%
ROIC(5y)4.27%
ROICexc(3y)4.36%
ROICexc(5y)4.27%
ROICexgc(3y)4.71%
ROICexgc(5y)4.64%
ROCE(3y)5.21%
ROCE(5y)5.14%
ROICexcg growth 3Y1.98%
ROICexcg growth 5Y0.43%
ROICexc growth 3Y2.41%
ROICexc growth 5Y0.94%
OM growth 3Y6.87%
OM growth 5Y4.19%
PM growth 3Y4.33%
PM growth 5Y3.33%
GM growth 3Y4.72%
GM growth 5Y1.38%
F-Score6
Asset Turnover0.19
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 1.37 | ||
| Debt/FCF | 54.98 | ||
| Debt/EBITDA | 4.85 | ||
| Cap/Depr | 227.21% | ||
| Cap/Sales | 34.6% | ||
| Interest Coverage | 3.01 | ||
| Cash Conversion | 95.66% | ||
| Profit Quality | 22.9% | ||
| Current Ratio | 0.5 | ||
| Quick Ratio | 0.4 | ||
| Altman-Z | 1.1 |
F-Score6
WACC7.09%
ROIC/WACC0.64
Cap/Depr(3y)212.24%
Cap/Depr(5y)215.17%
Cap/Sales(3y)29.51%
Cap/Sales(5y)29.31%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)4.01%
EPS 3Y5.96%
EPS 5Y6.44%
EPS Q2Q%15.23%
EPS Next Y8.11%
EPS Next 2Y7.45%
EPS Next 3Y7.3%
EPS Next 5Y7.34%
Revenue 1Y (TTM)4.42%
Revenue growth 3Y1.13%
Revenue growth 5Y2.71%
Sales Q2Q%17.51%
Revenue Next Year4.08%
Revenue Next 2Y4.81%
Revenue Next 3Y4.99%
Revenue Next 5Y5.51%
EBIT growth 1Y2.6%
EBIT growth 3Y8.08%
EBIT growth 5Y7.02%
EBIT Next Year72.32%
EBIT Next 3Y26.83%
EBIT Next 5Y19.66%
FCF growth 1Y155.69%
FCF growth 3YN/A
FCF growth 5Y31.31%
OCF growth 1Y97.24%
OCF growth 3Y16.47%
OCF growth 5Y6.49%