WEC Energy Group Inc

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WEC : NYSE : Utilities
$64.17 up 0.18 | 0.28%
Today's Range: 63.79 - 64.34
Avg. Daily Volume: 2,034,400
07/28/16 - 4:01 PM ET

Financial Analysis


WEC ENERGY GROUP INC's gross profit margin for the second quarter of its fiscal year 2016 is essentially unchanged when compared to the same period a year ago. The company has grown sales and net income significantly, outpacing the average growth rates of competitors within its industry. WEC ENERGY GROUP INC has very weak liquidity. Currently, the Quick Ratio is 0.44 which clearly shows a lack of ability to cover short-term cash needs. The company's liquidity has increased from the same period last year, indicating improving cash flow.

At the same time, stockholders' equity ("net worth") has remained virtually unchanged only increasing by 3.81% from the same quarter last year. The key liquidity measurements indicate that the company is in a position in which financial difficulties could develop in the near future.

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Income Statement Q2 FY16 Q2 FY15
Net Sales ($mil)1602.0991.2
EBITDA ($mil)522.1334.2
EBIT ($mil)332.1233.2
Net Income ($mil)181.780.9


Balance Sheet Q2 FY16 Q2 FY15
Cash & Equiv. ($mil)32.1214.4
Total Assets ($mil)29175.328614.5
Total Debt ($mil)9925.79982.3
Equity ($mil)8863.98538.2


Profitability Q2 FY16 Q2 FY15
Gross Profit Margin32.5933.72
EBITDA Margin32.5933.71
Operating Margin20.7323.53
Sales Turnover0.250.16
Return on Assets3.051.83
Return on Equity10.036.14
Debt Q2 FY16 Q2 FY15
Current Ratio0.830.77
Debt/Capital0.530.54
Interest Expense100.162.1
Interest Coverage3.323.76


Share Data Q2 FY16 Q2 FY15
Shares outstanding (mil)315.62315.68
Div / share0.50.63
EPS0.570.35
Book value / share28.0827.05
Institutional Own % n/a n/a
Avg Daily Volume2022918.01927020.0

Valuation


BUY. This stock's P/E ratio indicates a premium compared to an average of 21.35 for the Multi-Utilities industry and a discount compared to the S&P 500 average of 25.07. For additional comparison, its price-to-book ratio of 2.28 indicates a discount versus the S&P 500 average of 2.81 and a discount versus the industry average of 2.49. The current price-to-sales ratio is well above the S&P 500 average and above the industry average, indicating a premium. The valuation analysis reveals that, WEC ENERGY GROUP INC seems to be trading at a premium to investment alternatives within the industry.


Price/Earnings
1 2 3 4 5
premium   discount
  Price/Cash Flow
1 2 3 4 5
premium   discount
WEC 22.77 Peers 21.35   WEC 11.21 Peers 8.44

Average. An average P/E ratio can signify an industry neutral price for a stock and an average growth expectation.

WEC is trading at a valuation on par with its peers.

 

Premium. The P/CF ratio, a stock’s price divided by the company's cash flow from operations, is useful for comparing companies with different capital requirements or financing structures.

WEC is trading at a significant premium to its peers.

 
Price/Projected
Earnings
1 2 3 4 5
premium   discount
  Price to
Earnings/Growth
1 2 3 4 5
premium   discount
WEC 20.64 Peers 19.84   WEC 0.90 Peers 2.00

Premium. A higher price-to-projected earnings ratio than its peers can signify a more expensive stock or higher future growth expectations.

WEC is trading at a premium to its peers.

 

Discount. The PEG ratio is the stock’s P/E divided by the consensus estimate of long-term earnings growth. Faster growth can justify higher price multiples.

WEC trades at a significant discount to its peers.

 
Price/Book
1 2 3 4 5
premium   discount
  Earnings Growth
1 2 3 4 5
lower   higher
WEC 2.28 Peers 2.49   WEC 22.17 Peers -3.28

Average. A lower price-to-book ratio makes a stock more attractive to investors seeking stocks with lower market values per dollar of equity on the balance sheet.

WEC is trading at a valuation on par with its peers.

 

Higher. Elevated earnings growth rates can lead to capital appreciation and justify higher price-to-earnings ratios.

WEC is expected to have an earnings growth rate that significantly exceeds its peers.

 
Price/Sales
1 2 3 4 5
premium   discount
  Sales Growth
1 2 3 4 5
premium   discount
WEC 2.75 Peers 2.55   WEC 58.35 Peers -2.30

Average. In the absence of P/E and P/B multiples, the price-to-sales ratio can display the value investors are placing on each dollar of sales.

WEC is trading at a valuation on par with its industry on this measurement.

 

Higher. A sales growth rate that exceeds the industry implies that a company is gaining market share.

WEC has a sales growth rate that significantly exceeds its peers.

 

 

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