WENDY'S CO/THE (WEN) Stock Fundamental Analysis
NASDAQ:WEN - Nasdaq - US95058W1009 - Common Stock - Currency: USD
WEN gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 136 industry peers in the Hotels, Restaurants & Leisure industry. WEN scores excellent on profitability, but there are some minor concerns on its financial health. WEN has a valuation in line with the averages, but on the other hand it scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year WEN was profitable.
In the past year WEN had a positive cash flow from operations.
In the past 5 years WEN has always been profitable.
Each year in the past 5 years WEN had a positive operating cash flow.
1.2 Ratios
The Return On Assets of WEN (3.86%) is better than 61.76% of its industry peers.
WEN has a better Return On Equity (74.94%) than 98.53% of its industry peers.
WEN has a Return On Invested Capital (5.89%) which is in line with its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for WEN is significantly below the industry average of 14.23%.
The last Return On Invested Capital (5.89%) for WEN is above the 3 year average (5.43%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.86% | ||
| ROE | 74.94% | ||
| ROIC | 5.89% |
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
The Profit Margin of WEN (8.65%) is better than 69.85% of its industry peers.
In the last couple of years the Profit Margin of WEN has grown nicely.
WEN's Operating Margin of 16.82% is fine compared to the rest of the industry. WEN outperforms 70.59% of its industry peers.
In the last couple of years the Operating Margin of WEN has remained more or less at the same level.
The Gross Margin of WEN (63.35%) is better than 77.21% of its industry peers.
In the last couple of years the Gross Margin of WEN has remained more or less at the same level.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 16.82% | ||
| PM (TTM) | 8.65% | ||
| GM | 63.35% |
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
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), WEN is destroying value.
The number of shares outstanding for WEN has been reduced compared to 1 year ago.
Compared to 5 years ago, WEN has less shares outstanding
The debt/assets ratio for WEN is higher compared to a year ago.
2.2 Solvency
WEN has an Altman-Z score of 1.18. 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 1.18 is on the low side compared to the rest of the industry. WEN is outperformed by 61.03% of its industry peers.
The Debt to FCF ratio of WEN is 12.79, which is on the high side as it means it would take WEN, 12.79 years of fcf income to pay off all of its debts.
WEN has a Debt to FCF ratio (12.79) which is comparable to the rest of the industry.
WEN has a Debt/Equity ratio of 12.48. This is a high value indicating a heavy dependency on external financing.
Looking at the Debt to Equity ratio, with a value of 12.48, WEN is doing worse than 65.44% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 12.48 | ||
| Debt/FCF | 12.79 | ||
| Altman-Z | 1.18 |
ROIC/WACC0.8
WACC7.34%
2.3 Liquidity
A Current Ratio of 1.85 indicates that WEN should not have too much problems paying its short term obligations.
WEN has a better Current ratio (1.85) than 83.09% of its industry peers.
A Quick Ratio of 1.83 indicates that WEN should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.83, WEN belongs to the top of the industry, outperforming 83.82% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.85 | ||
| Quick Ratio | 1.83 |
3. Growth
3.1 Past
The earnings per share for WEN have decreased by -2.02% in the last year.
The Earnings Per Share has been growing by 11.13% on average over the past years. This is quite good.
The Revenue has been growing slightly by 2.98% 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)-2.02%
EPS 3Y6.84%
EPS 5Y11.13%
EPS Q2Q%-13.04%
Revenue 1Y (TTM)2.98%
Revenue growth 3Y5.8%
Revenue growth 5Y5.62%
Sales Q2Q%-2.11%
3.2 Future
Based on estimates for the next years, WEN will show a quite strong growth in Earnings Per Share. The EPS will grow by 8.08% on average per year.
The Revenue is expected to grow by 3.35% on average over the next years.
EPS Next Y0.91%
EPS Next 2Y6.53%
EPS Next 3Y7.67%
EPS Next 5Y8.08%
Revenue Next Year0.67%
Revenue Next 2Y2.45%
Revenue Next 3Y2.93%
Revenue Next 5Y3.35%
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 decreasing.
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
Based on the Price/Earnings ratio of 12.25, the valuation of WEN can be described as correct.
Based on the Price/Earnings ratio, WEN is valued cheaper than 84.56% of the companies in the same industry.
WEN is valuated rather cheaply when we compare the Price/Earnings ratio to 24.29, which is the current average of the S&P500 Index.
WEN is valuated reasonably with a Price/Forward Earnings ratio of 10.47.
Compared to the rest of the industry, the Price/Forward Earnings ratio of WEN indicates a rather cheap valuation: WEN is cheaper than 86.76% of the companies listed in the same industry.
WEN is valuated rather cheaply when we compare the Price/Forward Earnings ratio to 20.42, which is the current average of the S&P500 Index.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.25 | ||
| Fwd PE | 10.47 |
4.2 Price Multiples
WEN's Enterprise Value to EBITDA ratio is a bit cheaper when compared to the industry. WEN is cheaper than 64.71% of the companies in the same industry.
91.91% 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 | 8.93 | ||
| EV/EBITDA | 9.74 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates an expensive valuation of the company.
WEN has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)13.41
PEG (5Y)1.1
EPS Next 2Y6.53%
EPS Next 3Y7.67%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 7.11%, WEN is a good candidate for dividend investing.
Compared to an average industry Dividend Yield of 3.60, WEN pays a better dividend. On top of this WEN pays more dividend than 95.59% of the companies listed in the same industry.
Compared to an average S&P500 Dividend Yield of 2.43, WEN pays a better dividend.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.11% |
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 Years3
Div Non Decr Years4
5.3 Sustainability
105.19% of the earnings are spent on dividend by WEN. This is not a sustainable payout ratio.
The dividend of WEN is growing, but the earnings are growing slower. This means the dividend growth is not sustainable.
DP105.19%
EPS Next 2Y6.53%
EPS Next 3Y7.67%
NASDAQ:WEN (5/7/2025, 1:18:08 PM)
11.88
+0.01 (+0.08%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners92.71%
Inst Owner Change-0.33%
Ins Owners8.32%
Ins Owner Change0.28%
Market Cap2.33B
Analysts64.85
Price Target15.17 (27.69%)
Short Float %9.43%
Short Ratio2.99
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 7.11% |
Yearly Dividend1
Dividend Growth(5Y)32.37%
DP105.19%
Div Incr Years3
Div Non Decr Years4
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)0.16%
Min EPS beat(2)-1.97%
Max EPS beat(2)2.3%
EPS beat(4)2
Avg EPS beat(4)1.17%
Min EPS beat(4)-3.06%
Max EPS beat(4)7.4%
EPS beat(8)5
Avg EPS beat(8)0.5%
EPS beat(12)8
Avg EPS beat(12)1.1%
EPS beat(16)12
Avg EPS beat(16)6.73%
Revenue beat(2)2
Avg Revenue beat(2)0.5%
Min Revenue beat(2)0.13%
Max Revenue beat(2)0.88%
Revenue beat(4)2
Avg Revenue beat(4)-0.8%
Min Revenue beat(4)-2.13%
Max Revenue beat(4)0.88%
Revenue beat(8)3
Avg Revenue beat(8)-1.11%
Revenue beat(12)3
Avg Revenue beat(12)-1.31%
Revenue beat(16)6
Avg Revenue beat(16)-0.41%
PT rev (1m)-4.72%
PT rev (3m)-14%
EPS NQ rev (1m)-2.18%
EPS NQ rev (3m)-13.03%
EPS NY rev (1m)-0.62%
EPS NY rev (3m)-3.87%
Revenue NQ rev (1m)-0.82%
Revenue NQ rev (3m)-3.57%
Revenue NY rev (1m)-0.39%
Revenue NY rev (3m)-1.39%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 12.25 | ||
| Fwd PE | 10.47 | ||
| P/S | 1.04 | ||
| P/FCF | 8.93 | ||
| P/OCF | 6.56 | ||
| P/B | 8.99 | ||
| P/tB | N/A | ||
| EV/EBITDA | 9.74 |
EPS(TTM)0.97
EY8.16%
EPS(NY)1.13
Fwd EY9.55%
FCF(TTM)1.33
FCFY11.19%
OCF(TTM)1.81
OCFY15.24%
SpS11.45
BVpS1.32
TBVpS-8.69
PEG (NY)13.41
PEG (5Y)1.1
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.86% | ||
| ROE | 74.94% | ||
| ROCE | 8.15% | ||
| ROIC | 5.89% | ||
| ROICexc | 6.52% | ||
| ROICexgc | 12.28% | ||
| OM | 16.82% | ||
| PM (TTM) | 8.65% | ||
| GM | 63.35% | ||
| FCFM | 11.61% |
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 | 12.48 | ||
| Debt/FCF | 12.79 | ||
| Debt/EBITDA | 6.04 | ||
| Cap/Depr | 59.76% | ||
| Cap/Sales | 4.2% | ||
| Interest Coverage | 2.6 | ||
| Cash Conversion | 66.32% | ||
| Profit Quality | 134.25% | ||
| Current Ratio | 1.85 | ||
| Quick Ratio | 1.83 | ||
| Altman-Z | 1.18 |
F-Score6
WACC7.34%
ROIC/WACC0.8
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)-2.02%
EPS 3Y6.84%
EPS 5Y11.13%
EPS Q2Q%-13.04%
EPS Next Y0.91%
EPS Next 2Y6.53%
EPS Next 3Y7.67%
EPS Next 5Y8.08%
Revenue 1Y (TTM)2.98%
Revenue growth 3Y5.8%
Revenue growth 5Y5.62%
Sales Q2Q%-2.11%
Revenue Next Year0.67%
Revenue Next 2Y2.45%
Revenue Next 3Y2.93%
Revenue Next 5Y3.35%
EBIT growth 1Y-2.08%
EBIT growth 3Y4.25%
EBIT growth 5Y6.41%
EBIT Next Year47.09%
EBIT Next 3Y17.46%
EBIT Next 5Y12.37%
FCF growth 1Y0.2%
FCF growth 3Y-0.86%
FCF growth 5Y4.01%
OCF growth 1Y2.86%
OCF growth 3Y0.91%
OCF growth 5Y4.22%