Westpac Banking Corporation
Westpac Banking Corporation Fundamental Analysis
Westpac Banking Corporation (WBCPL.AX) shows weak financial fundamentals with a PE ratio of 21.04, profit margin of 17.81%, and ROE of 9.55%. The company generates $38.9B in annual revenue with weak year-over-year growth of 0.26%.
Key Strengths
Areas of Concern
The stock receives a Fundamental Health Score of 24.1/100 based on profitability, valuation, growth, and balance sheet metrics. The F grade reflects weak fundamentals and significant financial concerns.
Fundamental Health Score
We analyze WBCPL.AX's fundamental strength across five key dimensions:
Efficiency Score
WeakWBCPL.AX struggles to generate sufficient returns from assets.
Valuation Score
ExcellentWBCPL.AX trades at attractive valuation levels.
Growth Score
WeakWBCPL.AX faces weak or negative growth trends.
Financial Health Score
WeakWBCPL.AX carries high financial risk with limited liquidity.
Profitability Score
ModerateWBCPL.AX maintains healthy but balanced margins.
Key Financial Metrics
Is WBCPL.AX Expensive or Cheap?
P/E Ratio
WBCPL.AX trades at 21.04 times earnings. This indicates a fair valuation.
PEG Ratio
When adjusting for growth, WBCPL.AX's PEG of -42.71 indicates potential undervaluation.
Price to Book
The market values Westpac Banking Corporation at 2.00 times its book value. This may indicate undervaluation.
EV/EBITDA
Enterprise value stands at -8.44 times EBITDA. This is generally considered low.
How Well Does WBCPL.AX Make Money?
Net Profit Margin
For every $100 in sales, Westpac Banking Corporation keeps $17.81 as profit after all expenses.
Operating Margin
Core operations generate 26.56 in profit for every $100 in revenue, before interest and taxes.
ROE
Management delivers $9.55 in profit for every $100 of shareholder equity.
ROA
Westpac Banking Corporation generates $0.61 in profit for every $100 in assets, demonstrating efficient asset deployment.
Following the Money - Real Cash Generation
Operating Cash Flow
Westpac Banking Corporation generates limited operating cash flow of $2.56B, signaling weaker underlying cash strength.
Free Cash Flow
Westpac Banking Corporation produces free cash flow of $2.19B, offering steady but limited capital for shareholder returns and expansion.
FCF Per Share
Each share generates $0.64 in free cash annually.
FCF Yield
WBCPL.AX converts 1.50% of its market value into free cash.
Financial Ratios Analysis
Valuation Ratios
P/E Ratio
Price to earnings ratio
21.04
vs 25 benchmark
PEG Ratio
Price/earnings to growth ratio
-42.71
vs 25 benchmark
P/B Ratio
Price to book value ratio
2.00
vs 25 benchmark
P/S Ratio
Price to sales ratio
3.75
vs 25 benchmark
Financial Health
Debt/Equity
Total debt to shareholders' equity
3.19
vs 25 benchmark
Current Ratio
Current assets to current liabilities
0.00
vs 25 benchmark
Efficiency Ratios
ROE
Return on equity percentage
0.10
vs 25 benchmark
ROA
Return on assets percentage
0.006
vs 25 benchmark
ROCE
Return on capital employed
0.009
vs 25 benchmark
How WBCPL.AX Stacks Against Its Sector Peers
| Metric | WBCPL.AX Value | Sector Average | Performance |
|---|---|---|---|
| P/E Ratio | 21.04 | 18.94 | Worse (Expensive) |
| ROE | 9.55% | 846.00% | Weak |
| Net Margin | 17.81% | 4054.00% | Weak |
| Debt/Equity | 3.19 | 0.89 | Weak (High Leverage) |
| Current Ratio | 0.00 | 660.05 | Weak Liquidity |
| ROA | 0.61% | -24865.00% (disorted) | Weak |
WBCPL.AX outperforms its industry in 0 out of 6 key metrics, but lagging in P/E Ratio.
Historical Growth Performance
5-Year Growth Trajectory
This section reviews Westpac Banking Corporation's 5-year compound annual growth rate (CAGR) and compares its performance against the typical investment style of its industry.
Revenue CAGR
9.07%
Industry Style: Value, Dividend, Cyclical
GrowingEPS CAGR
5.99%
Industry Style: Value, Dividend, Cyclical
GrowingFCF CAGR
-439.44%
Industry Style: Value, Dividend, Cyclical
Declining