WESTROCK CO (WRK) Stock Fundamental Analysis
NYSE:WRK - New York Stock Exchange, Inc. - US96145D1054 - Common Stock - Currency: USD
Taking everything into account, WRK scores 2 out of 10 in our fundamental rating. WRK was compared to 22 industry peers in the Containers & Packaging industry. WRK has a bad profitability rating. Also its financial health evaluation is rather negative. WRK has a expensive valuation and it also scores bad on growth.
1. Profitability
1.1 Basic Checks
In the past year WRK was profitable.
In the past year WRK had a positive cash flow from operations.
In multiple years WRK reported negative net income over the last 5 years.
In the past 5 years WRK always reported a positive cash flow from operatings.
1.2 Ratios
With a Return On Assets value of 1.13%, WRK is not doing good in the industry: 65.22% of the companies in the same industry are doing better.
WRK's Return On Equity of 3.03% is on the low side compared to the rest of the industry. WRK is outperformed by 65.22% of its industry peers.
WRK's Return On Invested Capital of 3.67% is on the low side compared to the rest of the industry. WRK is outperformed by 73.91% of its industry peers.
The Average Return On Invested Capital over the past 3 years for WRK is below the industry average of 7.48%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.13% | ||
| ROE | 3.03% | ||
| ROIC | 3.67% |
ROA(3y)0.06%
ROA(5y)0.13%
ROE(3y)-0.3%
ROE(5y)0%
ROIC(3y)4.59%
ROIC(5y)4.4%
1.3 Margins
WRK has a Profit Margin of 1.57%. This is in the lower half of the industry: WRK underperforms 65.22% of its industry peers.
With a Operating Margin value of 5.37%, WRK is not doing good in the industry: 73.91% of the companies in the same industry are doing better.
In the last couple of years the Operating Margin of WRK has declined.
With a Gross Margin value of 17.67%, WRK is not doing good in the industry: 78.26% of the companies in the same industry are doing better.
In the last couple of years the Gross Margin of WRK has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.37% | ||
| PM (TTM) | 1.57% | ||
| GM | 17.67% |
OM growth 3Y-3.18%
OM growth 5Y-8.29%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.99%
GM growth 5Y-3.08%
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) below the Cost of Capital (WACC), WRK is destroying value.
The number of shares outstanding for WRK has been increased compared to 1 year ago.
Compared to 5 years ago, WRK has more shares outstanding
Compared to 1 year ago, WRK has a worse debt to assets ratio.
2.2 Solvency
Based on the Altman-Z score of 1.40, we must say that WRK is in the distress zone and has some risk of bankruptcy.
WRK's Altman-Z score of 1.40 is on the low side compared to the rest of the industry. WRK is outperformed by 78.26% of its industry peers.
The Debt to FCF ratio of WRK is 19.15, which is on the high side as it means it would take WRK, 19.15 years of fcf income to pay off all of its debts.
WRK has a worse Debt to FCF ratio (19.15) than 65.22% of its industry peers.
A Debt/Equity ratio of 0.77 indicates that WRK is somewhat dependend on debt financing.
Looking at the Debt to Equity ratio, with a value of 0.77, WRK is in the better half of the industry, outperforming 73.91% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.77 | ||
| Debt/FCF | 19.15 | ||
| Altman-Z | 1.4 |
ROIC/WACC0.51
WACC7.16%
2.3 Liquidity
A Current Ratio of 1.34 indicates that WRK should not have too much problems paying its short term obligations.
WRK's Current ratio of 1.34 is in line compared to the rest of the industry. WRK outperforms 56.52% of its industry peers.
WRK has a Quick Ratio of 1.34. This is a bad value and indicates that WRK is not financially healthy enough and could expect problems in meeting its short term obligations.
With a Quick ratio value of 0.85, WRK perfoms like the industry average, outperforming 47.83% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.34 | ||
| Quick Ratio | 0.85 |
3. Growth
3.1 Past
The earnings per share for WRK have decreased strongly by -46.62% in the last year.
Measured over the past years, WRK shows a decrease in Earnings Per Share. The EPS has been decreasing by -5.84% on average per year.
WRK shows a decrease in Revenue. In the last year, the revenue decreased by -7.89%.
Measured over the past years, WRK shows a small growth in Revenue. The Revenue has been growing by 4.52% on average per year.
EPS 1Y (TTM)-46.62%
EPS 3Y3.3%
EPS 5Y-5.84%
EPS Q2Q%-49.35%
Revenue 1Y (TTM)-7.89%
Revenue growth 3Y4.93%
Revenue growth 5Y4.52%
Sales Q2Q%-10.44%
3.2 Future
The Earnings Per Share is expected to grow by 11.14% on average over the next years. This is quite good.
WRK is expected to show a small growth in Revenue. In the coming years, the Revenue will grow by 1.08% yearly.
EPS Next Y-28.93%
EPS Next 2Y9.37%
EPS Next 3Y11.37%
EPS Next 5Y11.14%
Revenue Next Year-4.97%
Revenue Next 2Y-0.29%
Revenue Next 3Y0.27%
Revenue Next 5Y1.08%
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 22.49, which indicates a rather expensive current valuation of WRK.
WRK's Price/Earnings ratio is a bit more expensive when compared to the industry. WRK is more expensive than 65.22% of the companies in the same industry.
WRK is valuated at similar levels of the S&P average when we compare the Price/Earnings ratio to 25.91, which is the current average of the S&P500 Index.
A Price/Forward Earnings ratio of 14.26 indicates a correct valuation of WRK.
WRK's Price/Forward Earnings ratio is in line with the industry average.
When comparing the Price/Forward Earnings ratio of WRK to the average of the S&P500 Index (21.85), we can say WRK is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.49 | ||
| Fwd PE | 14.26 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, WRK is valued a bit cheaper than 60.87% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of WRK indicates a slightly more expensive valuation: WRK is more expensive than 65.22% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 28.18 | ||
| EV/EBITDA | 8.46 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y9.37%
EPS Next 3Y11.37%
5. Dividend
5.1 Amount
WRK has a Yearly Dividend Yield of 2.43%.
Compared to an average industry Dividend Yield of 3.20, WRK pays a bit more dividend than its industry peers.
Compared to an average S&P500 Dividend Yield of 2.36, WRK has a dividend comparable with the average S&P500 company.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.43% |
5.2 History
The dividend of WRK decreases each year by -8.63%.
WRK has been paying a dividend for at least 10 years, so it has a reliable track record.
The dividend of WRK decreased in the last 3 years.
Dividend Growth(5Y)-8.63%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
WRK pays out 97.28% of its income as dividend. This is not a sustainable payout ratio.
DP97.28%
EPS Next 2Y9.37%
EPS Next 3Y11.37%
51.51
+1.76 (+3.54%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryContainers & Packaging
Earnings (Last)
Earnings (Next)
Inst Owners6.59%
Inst Owner Change-65.65%
Ins Owners1.02%
Ins Owner Change0%
Market Cap13.30B
Analysts71.67
Price Target54.37 (5.55%)
Short Float %N/A
Short RatioN/A
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.43% |
Yearly Dividend1.1
Dividend Growth(5Y)-8.63%
DP97.28%
Div Incr Years2
Div Non Decr Years2
Ex-DateN/A
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)12.23%
Min EPS beat(2)-42.7%
Max EPS beat(2)67.16%
EPS beat(4)3
Avg EPS beat(4)30%
Min EPS beat(4)-42.7%
Max EPS beat(4)86.52%
EPS beat(8)6
Avg EPS beat(8)21.28%
EPS beat(12)10
Avg EPS beat(12)16.22%
EPS beat(16)13
Avg EPS beat(16)16.85%
Revenue beat(2)0
Avg Revenue beat(2)-3.05%
Min Revenue beat(2)-4.6%
Max Revenue beat(2)-1.49%
Revenue beat(4)0
Avg Revenue beat(4)-2.82%
Min Revenue beat(4)-4.6%
Max Revenue beat(4)-1.49%
Revenue beat(8)0
Avg Revenue beat(8)-2.32%
Revenue beat(12)3
Avg Revenue beat(12)-1.06%
Revenue beat(16)4
Avg Revenue beat(16)-1%
PT rev (1m)0%
PT rev (3m)19.62%
EPS NQ rev (1m)1.19%
EPS NQ rev (3m)-0.7%
EPS NY rev (1m)0.37%
EPS NY rev (3m)1.56%
Revenue NQ rev (1m)0.1%
Revenue NQ rev (3m)-0.92%
Revenue NY rev (1m)0%
Revenue NY rev (3m)-1.37%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 22.49 | ||
| Fwd PE | 14.26 | ||
| P/S | 0.68 | ||
| P/FCF | 28.18 | ||
| P/OCF | 8.32 | ||
| P/B | 1.32 | ||
| P/tB | 3.94 | ||
| EV/EBITDA | 8.46 |
EPS(TTM)2.29
EY4.45%
EPS(NY)3.61
Fwd EY7.01%
FCF(TTM)1.83
FCFY3.55%
OCF(TTM)6.19
OCFY12.02%
SpS75.37
BVpS38.99
TBVpS13.08
PEG (NY)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 1.13% | ||
| ROE | 3.03% | ||
| ROCE | 4.72% | ||
| ROIC | 3.67% | ||
| ROICexc | 3.76% | ||
| ROICexgc | 5.44% | ||
| OM | 5.37% | ||
| PM (TTM) | 1.57% | ||
| GM | 17.67% | ||
| FCFM | 2.43% |
ROA(3y)0.06%
ROA(5y)0.13%
ROE(3y)-0.3%
ROE(5y)0%
ROIC(3y)4.59%
ROIC(5y)4.4%
ROICexc(3y)4.65%
ROICexc(5y)4.44%
ROICexgc(3y)7.13%
ROICexgc(5y)7.05%
ROCE(3y)5.89%
ROCE(5y)5.66%
ROICexcg growth 3Y3.04%
ROICexcg growth 5Y-7.16%
ROICexc growth 3Y6.65%
ROICexc growth 5Y-4.49%
OM growth 3Y-3.18%
OM growth 5Y-8.29%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3Y-0.99%
GM growth 5Y-3.08%
F-Score5
Asset Turnover0.72
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.77 | ||
| Debt/FCF | 19.15 | ||
| Debt/EBITDA | 2.99 | ||
| Cap/Depr | 73.32% | ||
| Cap/Sales | 5.79% | ||
| Interest Coverage | 2.19 | ||
| Cash Conversion | 61.92% | ||
| Profit Quality | 154.77% | ||
| Current Ratio | 1.34 | ||
| Quick Ratio | 0.85 | ||
| Altman-Z | 1.4 |
F-Score5
WACC7.16%
ROIC/WACC0.51
Cap/Depr(3y)62.72%
Cap/Depr(5y)68.91%
Cap/Sales(3y)4.68%
Cap/Sales(5y)5.42%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)-46.62%
EPS 3Y3.3%
EPS 5Y-5.84%
EPS Q2Q%-49.35%
EPS Next Y-28.93%
EPS Next 2Y9.37%
EPS Next 3Y11.37%
EPS Next 5Y11.14%
Revenue 1Y (TTM)-7.89%
Revenue growth 3Y4.93%
Revenue growth 5Y4.52%
Sales Q2Q%-10.44%
Revenue Next Year-4.97%
Revenue Next 2Y-0.29%
Revenue Next 3Y0.27%
Revenue Next 5Y1.08%
EBIT growth 1Y-34.44%
EBIT growth 3Y1.6%
EBIT growth 5Y-4.15%
EBIT Next Year97.6%
EBIT Next 3Y34.37%
EBIT Next 5Y20.78%
FCF growth 1Y-60.82%
FCF growth 3Y-14.38%
FCF growth 5Y-5.94%
OCF growth 1Y-22.8%
OCF growth 3Y-4.07%
OCF growth 5Y-1.09%