WESTROCK CO (WRK)
US96145D1054 - Common Stock
We assign a fundamental rating of 2 out of 10 to WRK. WRK was compared to 23 industry peers in the Containers & Packaging industry. WRK has a bad profitability rating. Also its financial health evaluation is rather negative. WRK is valued expensive and it does not seem to be growing.
1. Profitability
1.1 Basic Checks
WRK had positive earnings in the past year.
WRK had a positive operating cash flow in the past year.
The reported net income has been mixed in the past 5 years: WRK reported negative net income in multiple years.
WRK had a positive operating cash flow in each of the past 5 years.
1.2 Ratios
With a Return On Assets value of -6.42%, WRK is not doing good in the industry: 91.30% of the companies in the same industry are doing better.
WRK has a Return On Equity of -16.92%. This is amonst the worse of the industry: WRK underperforms 86.96% of its industry peers.
WRK's Return On Invested Capital of 4.03% is on the low side compared to the rest of the industry. WRK is outperformed by 69.57% of its industry peers.
WRK had an Average Return On Invested Capital over the past 3 years of 4.59%. This is below the industry average of 8.25%.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -6.42% | ||
| ROE | -16.92% | ||
| ROIC | 4.03% |
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 worse Operating Margin (5.89%) than 69.57% of its industry peers.
In the last couple of years the Operating Margin of WRK has declined.
The Gross Margin of WRK (17.88%) is worse than 78.26% of its industry peers.
In the last couple of years the Gross Margin of WRK has declined.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 5.89% | ||
| PM (TTM) | N/A | ||
| GM | 17.88% |
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.
WRK has more shares outstanding than it did 5 years ago.
WRK has a worse debt/assets ratio than last year.
2.2 Solvency
Based on the Altman-Z score of 1.44, we must say that WRK is in the distress zone and has some risk of bankruptcy.
Looking at the Altman-Z score, with a value of 1.44, WRK is doing worse than 78.26% of the companies in the same industry.
WRK has a debt to FCF ratio of 11.79. This is a negative value and a sign of low solvency as WRK would need 11.79 years to pay back of all of its debts.
The Debt to FCF ratio of WRK (11.79) is worse than 60.87% of its industry peers.
WRK has a Debt/Equity ratio of 0.81. This is a neutral value indicating WRK is somewhat dependend on debt financing.
The Debt to Equity ratio of WRK (0.81) is better than 69.57% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | 11.79 | ||
| Altman-Z | 1.44 |
ROIC/WACC0.54
WACC7.44%
2.3 Liquidity
A Current Ratio of 1.55 indicates that WRK should not have too much problems paying its short term obligations.
With a Current ratio value of 1.55, WRK perfoms like the industry average, outperforming 52.17% of the companies in the same industry.
A Quick Ratio of 0.95 indicates that WRK may have some problems paying its short term obligations.
With a Quick ratio value of 0.95, WRK perfoms like the industry average, outperforming 56.52% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.55 | ||
| Quick Ratio | 0.95 |
3. Growth
3.1 Past
The earnings per share for WRK have decreased strongly by -43.07% in the last year.
The Earnings Per Share has been decreasing by -5.84% on average over the past years.
Looking at the last year, WRK shows a decrease in Revenue. The Revenue has decreased by -5.75% in the last year.
WRK shows a small growth in Revenue. Measured over the last years, the Revenue has been growing by 4.52% yearly.
EPS 1Y (TTM)-43.07%
EPS 3Y3.3%
EPS 5Y-5.84%
EPS growth Q2Q-63.64%
Revenue 1Y (TTM)-5.75%
Revenue growth 3Y4.93%
Revenue growth 5Y4.52%
Revenue growth Q2Q-6.16%
3.2 Future
Based on estimates for the next years, WRK will show a quite strong growth in Earnings Per Share. The EPS will grow by 11.14% on average per year.
The Revenue is expected to grow by 2.04% on average over the next years.
EPS Next Y-30.02%
EPS Next 2Y6.63%
EPS Next 3Y10.09%
EPS Next 5Y11.14%
Revenue Next Year-3.65%
Revenue Next 2Y0.27%
Revenue Next 3Y0.95%
Revenue Next 5Y2.04%
3.3 Evolution
The EPS growth rate is accelerating: in the next years the growth will be better than in the last years.
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
With a Price/Earnings ratio of 17.83, WRK is valued on the expensive side.
WRK's Price/Earnings ratio is in line with the industry average.
WRK's Price/Earnings ratio indicates a valuation a bit cheaper than the S&P500 average which is at 24.83.
Based on the Price/Forward Earnings ratio of 13.87, the valuation of WRK can be described as correct.
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 (21.32), we can say WRK is valued slightly cheaper.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 17.83 | ||
| Fwd PE | 13.87 |
4.2 Price Multiples
Based on the Enterprise Value to EBITDA ratio, WRK is valued a bit cheaper than 69.57% of the companies in the same industry.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of WRK is on the same level as its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 16.59 | ||
| EV/EBITDA | 7.47 |
4.3 Compensation for Growth
PEG (NY)N/A
PEG (5Y)N/A
EPS Next 2Y6.63%
EPS Next 3Y10.09%
5. Dividend
5.1 Amount
With a Yearly Dividend Yield of 2.46%, WRK has a reasonable but not impressive dividend return.
WRK's Dividend Yield is a higher than the industry average which is at 2.91.
WRK's Dividend Yield is comparable with the S&P500 average which is at 2.39.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.46% |
5.2 History
The dividend of WRK decreases each year by -8.63%.
WRK has paid a dividend for at least 10 years, which is a reliable track record.
WRK has decreased its dividend in the last 3 years.
Dividend Growth(5Y)-8.63%
Div Incr Years2
Div Non Decr Years2
5.3 Sustainability
The earnings of WRK are negative and hence is the payout ratio. WRK will probably not be able to sustain this dividend level.
DP-16.83%
EPS Next 2Y6.63%
EPS Next 3Y10.09%
WESTROCK CO
NYSE:WRK (4/18/2024, 12:20:20 PM)
47.615
+0.39 (+0.82%)
Chartmill FA Rating
GICS SectorMaterials
GICS IndustryGroupMaterials
GICS IndustryContainers & Packaging
Earnings (Last)
Earnings (Next)
Inst Owners
Inst Owner Change
Ins Owners
Ins Owner Change
Market Cap12.24B
Analysts
Price Target
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 2.46% |
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)
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EPS beat(4)
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EPS beat(8)
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EPS beat(12)
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EPS beat(16)
Avg EPS beat(16)
Revenue beat(2)
Avg Revenue beat(2)
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Revenue beat(4)
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Revenue beat(8)
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Revenue beat(12)
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Revenue beat(16)
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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 | 17.83 | ||
| Fwd PE | 13.87 | ||
| 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)N/A
PEG (5Y)N/A
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | -6.42% | ||
| ROE | -16.92% | ||
| ROCE | |||
| ROIC | |||
| ROICexc | |||
| ROICexgc | |||
| OM | 5.89% | ||
| PM (TTM) | N/A | ||
| GM | 17.88% | ||
| 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 Turnover0.75
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.81 | ||
| Debt/FCF | |||
| Debt/EBITDA | |||
| Cap/Depr | |||
| Cap/Sales | |||
| Interest Coverage | |||
| Cash Conversion | |||
| Profit Quality | |||
| Current Ratio | 1.55 | ||
| Quick Ratio | 0.95 | ||
| 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)-43.07%
EPS 3Y3.3%
EPS 5Y
EPS growth Q2Q
EPS Next Y-30.02%
EPS Next 2Y
EPS Next 3Y
EPS Next 5Y
Revenue 1Y (TTM)-5.75%
Revenue growth 3Y4.93%
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