WENDY'S CO/THE (WEN)
US95058W1009 - Common Stock
Taking everything into account, WEN scores 5 out of 10 in our fundamental rating. WEN was compared to 135 industry peers in the Hotels, Restaurants & Leisure industry. Both the profitability and the financial health of WEN get a neutral evaluation. Nothing too spectacular is happening here. WEN has a correct valuation and a medium growth rate.
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.
WEN 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 3.94%, WEN is in line with its industry, outperforming 57.46% of the companies in the same industry.
WEN has a better Return On Equity (66.00%) than 97.01% of its industry peers.
WEN has a Return On Invested Capital of 5.87%. This is comparable to the rest of the industry: WEN outperforms 50.75% of its industry peers.
The Average Return On Invested Capital over the past 3 years for WEN is significantly below the industry average of 10.32%.
The last Return On Invested Capital (5.87%) for WEN is above the 3 year average (5.24%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.94% | ||
| ROE | 66% | ||
| ROIC | 5.87% |
ROA(3y)3.7%
ROA(5y)3.24%
ROE(3y)50%
ROE(5y)39.59%
ROIC(3y)5.24%
ROIC(5y)4.91%
1.3 Margins
WEN's Profit Margin of 9.37% is fine compared to the rest of the industry. WEN outperforms 71.64% of its industry peers.
WEN's Profit Margin has declined in the last couple of years.
WEN has a Operating Margin of 17.68%. This is in the better half of the industry: WEN outperforms 73.88% of its industry peers.
In the last couple of years the Operating Margin of WEN has grown nicely.
Looking at the Gross Margin, with a value of 62.36%, WEN is in the better half of the industry, outperforming 70.15% of the companies in the same industry.
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 | 17.68% | ||
| PM (TTM) | 9.37% | ||
| GM | 62.36% |
OM growth 3Y1.91%
OM growth 5Y1.57%
PM growth 3Y11.31%
PM growth 5Y-20.19%
GM growth 3Y-0.3%
GM growth 5Y-0.47%
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.
Compared to 1 year ago, WEN has less shares outstanding
The number of shares outstanding for WEN has been reduced compared to 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 1.36. 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 1.36 is in line compared to the rest of the industry. WEN outperforms 41.79% of its industry peers.
WEN has a debt to FCF ratio of 12.87. This is a negative value and a sign of low solvency as WEN would need 12.87 years to pay back of all of its debts.
WEN has a Debt to FCF ratio of 12.87. This is comparable to the rest of the industry: WEN outperforms 52.99% of its industry peers.
A Debt/Equity ratio of 10.66 is on the high side and indicates that WEN has dependencies on debt financing.
Looking at the Debt to Equity ratio, with a value of 10.66, WEN is doing worse than 68.66% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 10.66 | ||
| Debt/FCF | 12.87 | ||
| Altman-Z | 1.36 |
ROIC/WACC0.78
WACC7.55%
2.3 Liquidity
WEN has a Current Ratio of 2.19. This indicates that WEN is financially healthy and has no problem in meeting its short term obligations.
The Current ratio of WEN (2.19) is better than 88.06% of its industry peers.
A Quick Ratio of 2.18 indicates that WEN has no problem at all paying its short term obligations.
WEN has a better Quick ratio (2.18) than 89.55% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 2.19 | ||
| Quick Ratio | 2.18 |
3. Growth
3.1 Past
WEN shows a strong growth in Earnings Per Share. In the last year, the EPS has been growing by 11.49%, which is quite good.
The Earnings Per Share has been growing by 10.83% on average over the past years. This is quite good.
WEN shows a small growth in Revenue. In the last year, the Revenue has grown by 4.11%.
Measured over the past years, WEN shows a small growth in Revenue. The Revenue has been growing by 6.53% on average per year.
EPS 1Y (TTM)11.49%
EPS 3Y19.39%
EPS 5Y10.83%
EPS growth Q2Q-4.55%
Revenue 1Y (TTM)4.11%
Revenue growth 3Y7.96%
Revenue growth 5Y6.53%
Revenue growth Q2Q0.77%
3.2 Future
The Earnings Per Share is expected to grow by 12.10% on average over the next years. This is quite good.
WEN is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 4.02% yearly.
EPS Next Y3.88%
EPS Next 2Y8.13%
EPS Next 3Y9.71%
EPS Next 5Y12.1%
Revenue Next Year3.44%
Revenue Next 2Y4.1%
Revenue Next 3Y3.37%
Revenue Next 5Y4.02%
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 decreasing.
4. Valuation
4.1 Price/Earnings Ratio
A Price/Earnings ratio of 19.80 indicates a rather expensive valuation of WEN.
Based on the Price/Earnings ratio, WEN is valued a bit cheaper than the industry average as 67.91% of the companies are valued more expensively.
The average S&P500 Price/Earnings ratio is at 24.80. WEN is valued slightly cheaper when compared to this.
The Price/Forward Earnings ratio is 19.06, which indicates a rather expensive current valuation of WEN.
Compared to the rest of the industry, the Price/Forward Earnings ratio of WEN indicates a somewhat cheap valuation: WEN is cheaper than 64.93% of the companies listed in the same industry.
WEN's Price/Forward Earnings ratio indicates a similar valuation than the S&P500 average which is at 21.27.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.8 | ||
| Fwd PE | 19.06 |
4.2 Price Multiples
The rest of the industry has a similar Enterprise Value to EBITDA ratio as WEN.
78.36% 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 | 15.16 | ||
| EV/EBITDA | 12.61 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates WEN does not grow enough to justify the current Price/Earnings ratio.
The decent profitability rating of WEN may justify a higher PE ratio.
PEG (NY)5.1
PEG (5Y)1.83
EPS Next 2Y8.13%
EPS Next 3Y9.71%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 5.35%, WEN is a good candidate for dividend investing.
WEN's Dividend Yield is rather good when compared to the industry average which is at 2.55. WEN pays more dividend than 96.27% of the companies in the same industry.
WEN's Dividend Yield is rather good when compared to the S&P500 average which is at 2.40.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.35% |
5.2 History
On average, the dividend of WEN grows each year by 20.25%, which is quite nice.
WEN has been paying a dividend for at least 10 years, so it has a reliable track record.
WEN has not decreased its dividend in the last 3 years.
Dividend Growth(5Y)20.25%
Div Incr Years3
Div Non Decr Years3
5.3 Sustainability
102.35% 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.
DP102.35%
EPS Next 2Y8.13%
EPS Next 3Y9.71%
WENDY'S CO/THE
NASDAQ:WEN (4/19/2024, 8:56:41 AM)
19.21
+0.21 (+1.11%)
Chartmill FA Rating
GICS SectorConsumer Discretionary
GICS IndustryGroupConsumer Services
GICS IndustryHotels, Restaurants & Leisure
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap3.95B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 5.35% |
Dividend Growth(5Y)
DP
Div Incr Years
Div Non Decr Years
Ex-Date
Surprises & Revisions
EPS beat(2)
Avg EPS beat(2)
Min EPS beat(2)
Max EPS beat(2)
EPS beat(4)
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Min EPS beat(4)
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EPS beat(8)
Avg EPS beat(8)
EPS beat(12)
Avg EPS beat(12)
EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
Min Revenue beat(2)
Max Revenue beat(2)
Revenue beat(4)
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Min Revenue beat(4)
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Revenue beat(8)
Avg Revenue beat(8)
Revenue beat(12)
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Revenue beat(16)
Avg Revenue beat(16)
PT rev (1m)
PT rev (3m)
EPS NQ rev (1m)
EPS NQ rev (3m)
EPS NY rev (1m)
EPS NY rev (3m)
Revenue NQ rev (1m)
Revenue NQ rev (3m)
Revenue NY rev (1m)
Revenue NY rev (3m)
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 19.8 | ||
| Fwd PE | 19.06 | ||
| P/S | |||
| P/FCF | |||
| P/OCF | |||
| P/B | |||
| P/tB | |||
| EV/EBITDA |
EPS(TTM)
EY
EPS(NY)
Fwd EY
FCF(TTM)
FCFY
OCF(TTM)
OCFY
SpS
BVpS
TBVpS
PEG (NY)5.1
PEG (5Y)1.83
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 3.94% | ||
| ROE | 66% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 17.68% | ||
| PM (TTM) | 9.37% | ||
| GM | 62.36% | ||
| FCFM |
ROA(3y)
ROA(5y)
ROE(3y)
ROE(5y)
ROIC(3y)
ROIC(5y)
ROICexc(3y)
ROICexc(5y)
ROICexgc(3y)
ROICexgc(5y)
ROCE(3y)
ROCE(5y)
ROICexcg growth 3Y
ROICexcg growth 5Y
ROICexc growth 3Y
ROICexc growth 5Y
OM growth 3Y
OM growth 5Y
PM growth 3Y
PM growth 5Y
GM growth 3Y
GM growth 5Y
F-Score
Asset Turnover0.42
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 10.66 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 2.19 | ||
| Quick Ratio | 2.18 | ||
| Altman-Z |
F-Score
WACC
ROIC/WACC
Cap/Depr(3y)
Cap/Depr(5y)
Cap/Sales(3y)
Cap/Sales(5y)
Profit Quality(3y)
Profit Quality(5y)
Growth
EPS 1Y (TTM)11.49%
EPS 3Y19.39%
EPS 5Y
EPS growth Q2Q
EPS Next Y3.88%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)4.11%
Revenue growth 3Y7.96%
Revenue growth 5Y
Revenue growth Q2Q
Revenue Next Year
Revenue Next 2Y
Revenue Next 3Y
Revenue Next 5Y
EBIT growth 1Y
EBIT growth 3Y
EBIT growth 5Y
EBIT Next Year
EBIT Next 3Y
EBIT Next 5Y
FCF growth 1Y
FCF growth 3Y
FCF growth 5Y
OCF growth 1Y
OCF growth 3Y
OCF growth 5Y