WILLIS TOWERS WATSON PLC (WTW) Stock Fundamental Analysis
USA - NASDAQ:WTW - IE00BDB6Q211 - Common Stock
322.13 USD
-2.17 (-0.67%)
322.13 USD
0 (0%)
WTW gets a fundamental rating of 5 out of 10. The analysis compared the fundamentals against 146 industry peers in the Insurance industry. While WTW has a great profitability rating, there are some minor concerns on its financial health. While showing a medium growth rate, WTW is valued expensive at the moment.
1. Profitability
1.1 Basic Checks
WTW had positive earnings in the past year.
WTW had a positive operating cash flow in the past year.
Of the past 5 years WTW 4 years were profitable.
In the past 5 years WTW always reported a positive cash flow from operatings.
1.2 Ratios
WTW has a better Return On Assets (7.71%) than 93.84% of its industry peers.
The Return On Equity of WTW (27.36%) is better than 91.78% of its industry peers.
The Return On Invested Capital of WTW (12.62%) is better than 96.58% of its industry peers.
Measured over the past 3 years, the Average Return On Invested Capital for WTW is above the industry average of 4.51%.
The last Return On Invested Capital (12.62%) for WTW is above the 3 year average (8.90%), which is a sign of increasing profitability.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.71% | ||
| ROE | 27.36% | ||
| ROIC | 12.62% |
ROA(3y)2.15%
ROA(5y)4.22%
ROE(3y)6.64%
ROE(5y)12.19%
ROIC(3y)8.9%
ROIC(5y)7.27%
1.3 Margins
WTW has a Profit Margin of 21.58%. This is amongst the best in the industry. WTW outperforms 91.10% of its industry peers.
WTW has a Operating Margin of 23.13%. This is amongst the best in the industry. WTW outperforms 84.25% of its industry peers.
In the last couple of years the Operating Margin of WTW has grown nicely.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| OM | 23.13% | ||
| PM (TTM) | 21.58% | ||
| GM | N/A |
OM growth 3Y10.88%
OM growth 5Y11.06%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
2. Health
2.1 Basic Checks
With a Return on Invested Capital (ROIC) just above the Cost of Capital (WACC), WTW is creating some value.
Compared to 1 year ago, WTW has less shares outstanding
Compared to 5 years ago, WTW has less shares outstanding
The debt/assets ratio for WTW is higher compared to a year ago.
2.2 Solvency
Based on the Altman-Z score of 1.62, we must say that WTW is in the distress zone and has some risk of bankruptcy.
WTW's Altman-Z score of 1.62 is amongst the best of the industry. WTW outperforms 85.62% of its industry peers.
The Debt to FCF ratio of WTW is 3.85, which is a good value as it means it would take WTW, 3.85 years of fcf income to pay off all of its debts.
The Debt to FCF ratio of WTW (3.85) is comparable to the rest of the industry.
A Debt/Equity ratio of 0.62 indicates that WTW is somewhat dependend on debt financing.
WTW's Debt to Equity ratio of 0.62 is on the low side compared to the rest of the industry. WTW is outperformed by 78.77% of its industry peers.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 3.85 | ||
| Altman-Z | 1.62 |
ROIC/WACC1.48
WACC8.51%
2.3 Liquidity
WTW has a Current Ratio of 1.10. This is a normal value and indicates that WTW is financially healthy and should not expect problems in meeting its short term obligations.
WTW has a Current ratio of 1.10. This is amongst the best in the industry. WTW outperforms 80.14% of its industry peers.
A Quick Ratio of 1.10 indicates that WTW should not have too much problems paying its short term obligations.
Looking at the Quick ratio, with a value of 1.10, WTW belongs to the top of the industry, outperforming 80.14% of the companies in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Current Ratio | 1.1 | ||
| Quick Ratio | 1.1 |
3. Growth
3.1 Past
The Earnings Per Share has been growing slightly by 6.05% over the past year.
WTW shows quite a strong growth in Earnings Per Share. Measured over the last years, the EPS has been growing by 9.03% yearly.
WTW shows a decrease in Revenue. In the last year, the revenue decreased by -0.02%.
Measured over the past years, WTW shows a small growth in Revenue. The Revenue has been growing by 3.48% on average per year.
EPS 1Y (TTM)6.05%
EPS 3Y7.25%
EPS 5Y9.03%
EPS Q2Q%4.78%
Revenue 1Y (TTM)-0.02%
Revenue growth 3Y3.34%
Revenue growth 5Y3.48%
Sales Q2Q%-0.04%
3.2 Future
WTW is expected to show quite a strong growth in Earnings Per Share. In the coming years, the EPS will grow by 9.39% yearly.
The Revenue is expected to grow by 2.99% on average over the next years.
EPS Next Y1.43%
EPS Next 2Y7.39%
EPS Next 3Y9.86%
EPS Next 5Y9.39%
Revenue Next Year-2.75%
Revenue Next 2Y1.58%
Revenue Next 3Y3.01%
Revenue Next 5Y2.99%
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 stable.
The Revenue growth rate is stable: in the next years the growth will be about the same than in the last years.
4. Valuation
4.1 Price/Earnings Ratio
Based on the Price/Earnings ratio of 18.74, the valuation of WTW can be described as rather expensive.
Compared to the rest of the industry, the Price/Earnings ratio of WTW indicates a slightly more expensive valuation: WTW is more expensive than 67.81% of the companies listed in the same industry.
The average S&P500 Price/Earnings ratio is at 25.89. WTW is valued slightly cheaper when compared to this.
WTW is valuated correctly with a Price/Forward Earnings ratio of 16.53.
64.38% of the companies in the same industry are cheaper than WTW, based on the Price/Forward Earnings ratio.
When comparing the Price/Forward Earnings ratio of WTW to the average of the S&P500 Index (34.59), we can say WTW is valued rather cheaply.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.74 | ||
| Fwd PE | 16.53 |
4.2 Price Multiples
WTW's Enterprise Value to EBITDA ratio is in line with the industry average.
Compared to the rest of the industry, the Price/Free Cash Flow ratio of WTW indicates a slightly more expensive valuation: WTW is more expensive than 63.01% of the companies listed in the same industry.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| P/FCF | 22.75 | ||
| EV/EBITDA | 13.04 |
4.3 Compensation for Growth
The high PEG Ratio(NY), which compensates the Price/Earnings for growth, indicates WTW does not grow enough to justify the current Price/Earnings ratio.
WTW has a very decent profitability rating, which may justify a higher PE ratio.
PEG (NY)13.11
PEG (5Y)2.08
EPS Next 2Y7.39%
EPS Next 3Y9.86%
5. Dividend
5.1 Amount
WTW has a Yearly Dividend Yield of 1.15%. Purely for dividend investing, there may be better candidates out there.
Compared to an average industry Dividend Yield of 3.47, WTW has a dividend in line with its industry peers.
Compared to an average S&P500 Dividend Yield of 2.36, WTW's dividend is way lower than the S&P500 average.
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.15% |
5.2 History
The dividend of WTW is nicely growing with an annual growth rate of 6.49%!
WTW has paid a dividend for at least 10 years, which is a reliable track record.
WTW has not decreased its dividend in the past 5 years, so it has a somewhat stable track record.
Dividend Growth(5Y)6.49%
Div Incr Years8
Div Non Decr Years8
5.3 Sustainability
WTW pays out 16.92% of its income as dividend. This is a sustainable payout ratio.
The dividend of WTW is growing, but earnings are growing more, so the dividend growth is sustainable.
DP16.92%
EPS Next 2Y7.39%
EPS Next 3Y9.86%
322.13
-2.17 (-0.67%)
Chartmill FA Rating
GICS SectorFinancials
GICS IndustryGroupInsurance
GICS IndustryInsurance
Earnings (Last)
Earnings (Next)
Inst Owners97.59%
Inst Owner Change0%
Ins Owners0.28%
Ins Owner Change0.08%
Market Cap31.42B
Revenue(TTM)9.81B
Net Income(TTM)2.12B
Analysts75.38
Price Target379.49 (17.81%)
Short Float %2.6%
Short Ratio5.09
Dividend
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Dividend Yield | 1.15% |
Yearly Dividend3.5
Dividend Growth(5Y)6.49%
DP16.92%
Div Incr Years8
Div Non Decr Years8
Ex-Date
Surprises & Revisions
EPS beat(2)1
Avg EPS beat(2)4.31%
Min EPS beat(2)-0.42%
Max EPS beat(2)9.03%
EPS beat(4)2
Avg EPS beat(4)1.48%
Min EPS beat(4)-2.96%
Max EPS beat(4)9.03%
EPS beat(8)5
Avg EPS beat(8)3.13%
EPS beat(12)8
Avg EPS beat(12)1.8%
EPS beat(16)12
Avg EPS beat(16)2.06%
Revenue beat(2)1
Avg Revenue beat(2)-0.3%
Min Revenue beat(2)-0.82%
Max Revenue beat(2)0.22%
Revenue beat(4)1
Avg Revenue beat(4)-1.37%
Min Revenue beat(4)-3.05%
Max Revenue beat(4)0.22%
Revenue beat(8)1
Avg Revenue beat(8)-1.45%
Revenue beat(12)4
Avg Revenue beat(12)-0.68%
Revenue beat(16)4
Avg Revenue beat(16)-1.44%
PT rev (1m)2.43%
PT rev (3m)3.14%
EPS NQ rev (1m)0.43%
EPS NQ rev (3m)1.04%
EPS NY rev (1m)0.33%
EPS NY rev (3m)2.13%
Revenue NQ rev (1m)-0.14%
Revenue NQ rev (3m)-0.21%
Revenue NY rev (1m)0.08%
Revenue NY rev (3m)0.43%
Valuation
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| PE | 18.74 | ||
| Fwd PE | 16.53 | ||
| P/S | 3.2 | ||
| P/FCF | 22.75 | ||
| P/OCF | 19.6 | ||
| P/B | 4.06 | ||
| P/tB | N/A | ||
| EV/EBITDA | 13.04 |
EPS(TTM)17.19
EY5.34%
EPS(NY)19.49
Fwd EY6.05%
FCF(TTM)14.16
FCFY4.39%
OCF(TTM)16.43
OCFY5.1%
SpS100.53
BVpS79.29
TBVpS-24.46
PEG (NY)13.11
PEG (5Y)2.08
Graham Number175.12
Profitability
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| ROA | 7.71% | ||
| ROE | 27.36% | ||
| ROCE | 15.98% | ||
| ROIC | 12.62% | ||
| ROICexc | 14.6% | ||
| ROICexgc | 83.34% | ||
| OM | 23.13% | ||
| PM (TTM) | 21.58% | ||
| GM | N/A | ||
| FCFM | 14.08% |
ROA(3y)2.15%
ROA(5y)4.22%
ROE(3y)6.64%
ROE(5y)12.19%
ROIC(3y)8.9%
ROIC(5y)7.27%
ROICexc(3y)9.9%
ROICexc(5y)8.3%
ROICexgc(3y)46.83%
ROICexgc(5y)41.54%
ROCE(3y)11.27%
ROCE(5y)9.2%
ROICexgc growth 3Y11.06%
ROICexgc growth 5Y19.69%
ROICexc growth 3Y21.06%
ROICexc growth 5Y22.92%
OM growth 3Y10.88%
OM growth 5Y11.06%
PM growth 3YN/A
PM growth 5YN/A
GM growth 3YN/A
GM growth 5YN/A
F-Score6
Asset Turnover0.36
Health
| Industry Rank | Sector Rank | ||
|---|---|---|---|
| Debt/Equity | 0.62 | ||
| Debt/FCF | 3.85 | ||
| Debt/EBITDA | 1.78 | ||
| Cap/Depr | 53.49% | ||
| Cap/Sales | 2.26% | ||
| Interest Coverage | 250 | ||
| Cash Conversion | 59.75% | ||
| Profit Quality | 65.26% | ||
| Current Ratio | 1.1 | ||
| Quick Ratio | 1.1 | ||
| Altman-Z | 1.62 |
F-Score6
WACC8.51%
ROIC/WACC1.48
Cap/Depr(3y)45.88%
Cap/Depr(5y)41.14%
Cap/Sales(3y)2.44%
Cap/Sales(5y)2.57%
Profit Quality(3y)N/A
Profit Quality(5y)N/A
High Growth Momentum
Growth
EPS 1Y (TTM)6.05%
EPS 3Y7.25%
EPS 5Y9.03%
EPS Q2Q%4.78%
EPS Next Y1.43%
EPS Next 2Y7.39%
EPS Next 3Y9.86%
EPS Next 5Y9.39%
Revenue 1Y (TTM)-0.02%
Revenue growth 3Y3.34%
Revenue growth 5Y3.48%
Sales Q2Q%-0.04%
Revenue Next Year-2.75%
Revenue Next 2Y1.58%
Revenue Next 3Y3.01%
Revenue Next 5Y2.99%
EBIT growth 1Y11.67%
EBIT growth 3Y14.58%
EBIT growth 5Y14.92%
EBIT Next Year26.84%
EBIT Next 3Y14.35%
EBIT Next 5YN/A
FCF growth 1Y43.56%
FCF growth 3Y-12.01%
FCF growth 5Y10.3%
OCF growth 1Y33.81%
OCF growth 3Y-9.81%
OCF growth 5Y6.94%
WILLIS TOWERS WATSON PLC / WTW FAQ
Can you provide the ChartMill fundamental rating for WILLIS TOWERS WATSON PLC?
ChartMill assigns a fundamental rating of 5 / 10 to WTW.
What is the valuation status of WILLIS TOWERS WATSON PLC (WTW) stock?
ChartMill assigns a valuation rating of 2 / 10 to WILLIS TOWERS WATSON PLC (WTW). This can be considered as Overvalued.
Can you provide the profitability details for WILLIS TOWERS WATSON PLC?
WILLIS TOWERS WATSON PLC (WTW) has a profitability rating of 7 / 10.
What are the PE and PB ratios of WILLIS TOWERS WATSON PLC (WTW) stock?
The Price/Earnings (PE) ratio for WILLIS TOWERS WATSON PLC (WTW) is 18.74 and the Price/Book (PB) ratio is 4.06.
What is the financial health of WILLIS TOWERS WATSON PLC (WTW) stock?
The financial health rating of WILLIS TOWERS WATSON PLC (WTW) is 5 / 10.