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Wesfarmers

ASX:WES
Snowflake Description

Outstanding track record with excellent balance sheet and pays a dividend.

The Snowflake is generated from 30 checks in 5 different areas, read more below.
WES
ASX
A$43B
Market Cap
  1. Home
  2. AU
  3. Retail
Company description

Wesfarmers Limited engages in the retail, coal mining and production, gas processing and distribution, industrial and safety product distribution, chemicals and fertilizers manufacturing, and investment businesses in Australia, New Zealand, the United Kingdom, and internationally. The last earnings update was 149 days ago. More info.


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WES Share Price and Events
7 Day Returns
1.8%
ASX:WES
1.5%
Oceania Multiline Retail
-0.9%
AU Market
1 Year Returns
-23.1%
ASX:WES
-20.1%
Oceania Multiline Retail
4.2%
AU Market
WES Shareholder Return
  7 Day 30 Day 90 Day 1 Year 3 Year 5 Year
Wesfarmers (WES) 1.8% 6% 9.9% -23.1% -8% -12.7%
Oceania Multiline Retail 1.5% 4.5% 7.7% -20.1% -10.8% -13.7%
AU Market -0.9% 1.4% 6% 4.2% 19% 11%
1 Year Return vs Industry and Market
  • WES underperformed the Multiline Retail industry which returned -20.1% over the past year.
  • WES underperformed the Market in Australia which returned 4.2% over the past year.
Price Volatility
WES
Industry
5yr Volatility vs Market

Value

 Is Wesfarmers undervalued based on future cash flows and its price relative to the stock market?

Value is all about what a company is worth versus what price it is available for. If you went into a grocery store and all the bananas were on sale at half price, they could be considered undervalued.
INTRINSIC VALUE BASED ON FUTURE CASH FLOWS
Here we compare the current share price of Wesfarmers to its discounted cash flow analysis.value.

The discounted cash flow value is simply looking at what the company is worth today, based on estimates of how much money it is expected to make in the future.
Raw Data

Below are the data sources, inputs and calculation used to determine the intrinsic value for Wesfarmers.

ASX:WES Discounted Cash Flow Data Sources
Data Point Source Value
Valuation Model 2 Stage Free Cash Flow to Equity
Levered Free Cash Flow Average of 12 Analyst Estimates (S&P Global) See below
Discount Rate (Cost of Equity) See below 7.1%
Perpetual Growth Rate 10-Year AU Government Bond Rate 2.3%

An important part of a discounted cash flow is the discount rate, below we explain how it has been calculated.

Calculation of Discount Rate/ Cost of Equity for ASX:WES
Data Point Calculation/ Source Result
Risk-Free Rate 10-Year AU Govt Bond Rate 2.3%
Equity Risk Premium S&P Global 6%
Multiline Retail Unlevered Beta Simply Wall St/ S&P Global 0.48
Re-levered Beta = Unlevered beta (1 + (1- tax rate) (Debt/Equity))
= 0.482 (1 + (1- 30%) (8.05%))
0.671
Levered Beta Levered Beta limited to 0.8 to 2.0
(practical range for a stable firm)
0.8
Discount Rate/ Cost of Equity = Cost of Equity = Risk Free Rate + (Levered Beta * Equity Risk Premium)
= 2.31% + (0.8 * 5.96%)
7.08%

Discounted Cash Flow Calculation for ASX:WES using 2 Stage Free Cash Flow to Equity Model

The calculations below outline how an intrinsic value for Wesfarmers is arrived at by discounting future cash flows to their present value using the 2 stage method. We try to start with analysts estimates of free cash flow, however if these are not available we use the most recent financial results. In the 1st stage we continue to grow the free cash flow over a 10 year period, with the growth rate trending towards the perpetual growth rate used in the 2nd stage. The 2nd stage assumes the company grows at a stable rate into perpetuity.

ASX:WES DCF 1st Stage: Next 10 year cash flow forecast
Levered FCF (AUD, Millions) Source Present Value
Discounted (@ 7.08%)
2020 2,145.77 Analyst x3 2,003.89
2021 2,177.93 Analyst x3 1,899.45
2022 1,865.84 Analyst x1 1,519.67
2023 1,816.90 Est @ -2.62% 1,381.96
2024 1,796.14 Est @ -1.14% 1,275.85
2025 1,794.23 Est @ -0.11% 1,190.22
2026 1,805.35 Est @ 0.62% 1,118.41
2027 1,825.69 Est @ 1.13% 1,056.24
2028 1,852.76 Est @ 1.48% 1,001.02
2029 1,884.84 Est @ 1.73% 951.02
Present value of next 10 years cash flows A$13,397.74
ASX:WES DCF 2nd Stage: Terminal Value
Calculation Result
Terminal Value = FCF2029 × (1 + g) ÷ (Discount Rate – g)
= A$1,884.84 × (1 + 2.31%) ÷ (7.08% – 2.31%)
A$40,445.01
Present Value of Terminal Value = Terminal Value ÷ (1 + r)10
= A$40,445.01 ÷ (1 + 7.08%)10
A$20,407.10
ASX:WES Total Equity Value
Calculation Result
Total Equity Value = Present value of next 10 years cash flows + Terminal Value
= A$13,397.74 + A$20,407.10
A$33,804.84
Equity Value per Share
(AUD)
= Total value / Shares Outstanding
= A$33,804.84 / 1,133.84
A$29.81
ASX:WES Discount to Share Price
Calculation Result
Value per share (AUD) From above. A$29.81
Current discount Discount to share price of A$38.45
= -1 x (A$38.45 - A$29.81) / A$29.81
-29%

Learn more about our DCF calculations in Simply Wall St’s analysis model .

  • The current share price of Wesfarmers is above its future cash flow value.
Often investors are willing to pay a premium for a company that has a high dividend or the potential for future growth.
PRICE RELATIVE TO MARKET
We can also value a company based on what the stock market is willing to pay for it. This is similar to the price of fruit (e.g. Mangoes or Avocados) increasing when they are out of season, or how much your home is worth.

The amount the stock market is willing to pay for Wesfarmers's earnings, growth and assets is considered below, and whether this is a fair price.
Price based on past earnings
Are Wesfarmers's earnings available for a low price, and how does this compare to other companies in the same industry?
Raw Data
ASX:WES PE (Price to Earnings) Ratio Data Sources
Data Point Source Value
Earnings Per Share * Company Filings (2018-12-31) in AUD A$2.66
ASX:WES Share Price ** ASX (2019-07-19) in AUD A$38.45
Oceania Multiline Retail Industry PE Ratio Median Figure of 5 Publicly-Listed Multiline Retail Companies 14.34x
Australia Market PE Ratio Median Figure of 546 Publicly-Listed Companies 16.07x

* Trailing twelve months (TTM) annual GAAP earnings per share excluding extraordinary items.

** Primary Listing of Wesfarmers.

ASX:WES PE (Price to Earnings) Ratio Calculation
Calculation Outcome
PE Ratio

= ASX:WES Share Price ÷ EPS (both in AUD)

= 38.45 ÷ 2.66

14.46x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Wesfarmers is overvalued based on earnings compared to the Oceania Multiline Retail industry average.
  • Wesfarmers is good value based on earnings compared to the Australia market.
Price based on expected Growth
Does Wesfarmers's expected growth come at a high price?
Raw Data
ASX:WES PEG (Price to Earnings to Growth) Ratio Data Sources
Data Point Source Value
PE Ratio See PE Ratio Section 14.46x
Net Income Annual Growth Rate See Future Growth Section.
Line of Best Fit* through Consensus Estimate Earnings of 12 Analysts
-40.9%per year
Global Multiline Retail Industry PEG Ratio Median Figure of 25 Publicly-Listed Multiline Retail Companies 1.52x
Australia Market PEG Ratio Median Figure of 361 Publicly-Listed Companies 1.35x

*Line of best fit is calculated by linear regression .

ASX:WES PEG (Price to Earnings to Growth) Ratio Calculation
Calculation Outcome
PEG Ratio

= PE Ratio ÷ Net Income Annual Growth Rate

= 14.46x ÷ -40.9%

-0.35x

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Wesfarmers earnings are not expected to grow next year, we can't assess if its growth is good value.
Price based on value of assets
What value do investors place on Wesfarmers's assets?
Raw Data
ASX:WES PB (Price to Book) Ratio Data Sources
Data Point Source Value
Book Value per Share Company Filings (2018-12-31) in AUD A$9.96
ASX:WES Share Price * ASX (2019-07-19) in AUD A$38.45
Oceania Multiline Retail Industry PB Ratio Median Figure of 5 Publicly-Listed Multiline Retail Companies 1.5x
Australia Market PB Ratio Median Figure of 1,693 Publicly-Listed Companies 1.7x
ASX:WES PB (Price to Book) Ratio Calculation
Calculation Outcome
PB Ratio

= ASX:WES Share Price ÷ Book Value per Share (both in AUD)

= 38.45 ÷ 9.96

3.86x

* Primary Listing of Wesfarmers.

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Wesfarmers is overvalued based on assets compared to the Oceania Multiline Retail industry average.
X
Value checks
We assess Wesfarmers's value by looking at:
  1. Is the discounted cash flow value less than 20%, or 40% of the share price? (2 checks) ( Click here or on bar chart for details of DCF calculation. )
  2. Is the PE ratio less than the market average, and/ or less than the Multiline Retail industry average (and greater than 0)? (2 checks)
  3. Is the PEG ratio within a reasonable range (0 to 1)? (1 check)
  4. Is the PB ratio less than the Multiline Retail industry average (and greater than 0)? (1 check)
  5. Wesfarmers has a total score of 1/6, see the detailed checks below.

    Note: We use GAAP Earnings per Share in all our calculations including PE and PEG Ratio.

    Full details on the Value part of the Simply Wall St company analysis model.

Future Performance

 How is Wesfarmers expected to perform in the next 1 to 3 years based on estimates from 12 analysts?

The future performance of a company is measured in the same way as past performance, by looking at estimated growth and how much profit it is expected to make.

Future estimates come from professional analysts. Just like forecasting the weather, they don’t always get it right!
Annual Growth Rate
-40.9%
Expected annual growth in earnings.
Earnings growth vs Low Risk Savings
Is Wesfarmers expected to grow at an attractive rate?
  • Wesfarmers's earnings are expected to decrease over the next 1-3 years, this is below the low risk savings rate of 2.3%.
Growth vs Market Checks
  • Wesfarmers's earnings are expected to decrease over the next 1-3 years, this is below the Australia market average.
  • Wesfarmers's revenues are expected to decrease over the next 1-3 years, this is below the Australia market average.
Annual Growth Rates Comparison
Raw Data
ASX:WES Future Growth Rates Data Sources
Data Point Source Value (per year)
ASX:WES Future Earnings Growth Rate Line of Best Fit* through Consensus Estimate Earnings of 12 Analysts -40.9%
ASX:WES Future Revenue Growth Rate Line of Best Fit* through Consensus Estimate Revenue of 12 Analysts -1.9%
Oceania Multiline Retail Industry Earnings Growth Rate Market Cap Weighted Average -35.6%
Oceania Multiline Retail Industry Revenue Growth Rate Market Cap Weighted Average -0.6%
Australia Market Earnings Growth Rate Market Cap Weighted Average 7.4%
Australia Market Revenue Growth Rate Market Cap Weighted Average 3.4%

*Line of best fit is calculated by linear regression .

Industry and Market average data is calculated daily.

Learn more about our growth rate calculations in Simply Wall St’s analysis model.

Analysts growth expectations
Raw Data
ASX:WES Analysts Growth Expectations Data Sources
Data Point Source Value
Past Financials Company Filings (6 months ago) See Below
Future Estimates Average of up to 12 Analyst Estimates (S&P Global) See Below
All numbers in AUD Millions and using Trailing twelve months (TTM) annual period rather than quarterly.
ASX:WES Future Estimates Data
Date (Data in AUD Millions) Revenue Cash Flow Net Income * Avg. No. Analysts
2023-06-30 32,896 1
2022-06-30 30,535 2,332 3
2021-06-30 29,621 2,908 2,090 10
2020-06-30 28,694 2,804 2,082 12
2019-06-30 27,672 3,081 5,423 9
ASX:WES Past Financials Data
Date (Data in AUD Millions) Revenue Cash Flow Net Income *
2018-12-31 67,457 3,170 3,006
2018-09-30 67,170 3,625 2,805
2018-06-30 66,883 4,080 2,604
2017-12-31 43,810 4,475 1,861
2017-09-30 54,362 4,351 2,311
2017-06-30 64,913 4,226 2,760
2017-03-31 67,940 3,918 1,732
2016-12-31 67,436 3,609 591
2016-09-30 66,709 3,487 499
2016-06-30 65,981 3,365 407
2016-03-31 64,960 3,640 1,432

*GAAP earnings excluding extraordinary items.

Super high growth metrics
High Growth Checks
  • Wesfarmers's earnings are expected to decrease over the next 1-3 years, this is not considered high growth.
  • Wesfarmers's revenue is expected to decrease over the next 1-3 years, this is not considered high growth.
Past and Future Earnings per Share
The accuracy of the analysts who estimate the future performance data can be gauged below. We look back 3 years and see if they were any good at predicting what actually occurred. We also show the highest and lowest estimates looking forward to see if there is a wide range.
Raw Data
ASX:WES Past and Future Earnings per Share
Data Point Source Value
Past Financials Company Filings (6 months ago) See Below
Future Estimates Average of up to 12 Analyst Estimates (S&P Global) See Below

All data from Wesfarmers Company Filings, last reported 6 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

ASX:WES Future Estimates Data
Date (Data in AUD Millions) EPS * EPS High Estimate EPS Low Estimate Avg. No. Analysts
2023-06-30
2022-06-30 2.06 2.06 2.06 1.00
2021-06-30 1.77 2.01 1.48 8.00
2020-06-30 1.70 1.83 1.41 9.00
2019-06-30 4.71 4.84 4.44 6.00
ASX:WES Past Financials Data
Date (Data in AUD Millions) EPS *
2018-12-31 2.66
2018-09-30 2.48
2018-06-30 2.30
2017-12-31 1.65
2017-09-30 2.05
2017-06-30 2.45
2017-03-31 1.54
2016-12-31 0.53
2016-09-30 0.44
2016-06-30 0.36
2016-03-31 1.28

*GAAP earnings excluding extraordinary items.

Performance in 3 years
In the same way as past performance we look at the future estimated return (profit) compared to the available funds. We do this looking forward 3 years.
  • Wesfarmers is expected to efficiently use shareholders’ funds in the future (Return on Equity greater than 20%).
X
Future performance checks
We assess Wesfarmers's future performance by looking at:
  1. Is the annual earnings growth rate expected to beat the low risk savings rate, plus a premium to keep pace with inflation?
  2. Is the annual earnings growth rate expected to beat the average growth rate in earnings of the Oceania market? (1 check)
  3. Is the annual revenue growth rate expected to beat the average growth rate in revenue of the Oceania market? (1 check)
  4. Is the annual earnings growth rate expected to be above 20%? (1 check)
  5. Is the annual revenue growth rate expected to be above 20%? (1 check)
  6. Is the Return on Equity in 3 years expected to be over 20%? (1 check)
Some of the above checks will fail if the company is expected to be loss making in the relevant year.
Wesfarmers has a total score of 1/6, see the detailed checks below.

Note 1: We use GAAP Net Income Excluding Exceptional Items for our Earnings in all our calculations.

Full details on the Future part of the Simply Wall St company analysis model.

Past Performance

  How has Wesfarmers performed over the past 5 years?

The past performance of a company can be measured by how much growth it has experienced and how much profit it makes relative to the funds and assets it has available.
Past earnings growth
Below we compare Wesfarmers's growth in the last year to its industry (Multiline Retail).
Past Earnings growth analysis
We also check if the company has grown in the past 5 years, and whether it has maintained that growth in the year.
  • Wesfarmers's year on year earnings growth rate has been positive over the past 5 years.
  • Wesfarmers's 1-year earnings growth exceeds its 5-year average (61.5% vs 8.4%)
  • Wesfarmers's earnings growth has exceeded the Global Multiline Retail industry average in the past year (61.5% vs -9.2%).
Earnings and Revenue History
Wesfarmers's revenue and profit over the past 5 years is shown below, any years where they have experienced a loss will show up in red.
Raw Data

All data from Wesfarmers Company Filings, last reported 6 months ago, and in Trailing twelve months (TTM) annual period rather than quarterly.

ASX:WES Past Revenue, Cash Flow and Net Income Data
Date (Data in AUD Millions) Revenue Net Income * G+A Expenses R&D Expenses
2018-12-31 67,457.00 3,006.00 13,253.00
2018-09-30 67,170.00 2,805.00 13,180.50
2018-06-30 66,883.00 2,604.00 13,108.00
2017-12-31 43,810.00 1,861.00 8,839.00
2017-09-30 54,361.50 2,310.50 10,662.00
2017-06-30 64,913.00 2,760.00 12,485.00
2017-03-31 67,940.00 1,732.00 13,424.00
2016-12-31 67,436.00 591.00 13,391.00
2016-09-30 66,708.50 499.00 13,137.50
2016-06-30 65,981.00 407.00 12,884.00
2016-03-31 64,960.00 1,432.00 12,490.00
2015-12-31 63,939.00 2,457.00 12,096.00
2015-09-30 63,193.00 2,448.50 11,975.00
2015-06-30 62,447.00 2,440.00 11,854.00
2015-03-31 61,927.50 2,027.50 11,735.00
2014-12-31 61,408.00 1,615.00 11,616.00
2014-09-30 60,794.50 1,562.50 11,448.00
2014-06-30 60,181.00 1,510.00 11,280.00
2013-12-31 57,878.00 2,114.00 10,824.00
2013-09-30 57,813.50 2,121.00 10,851.50
2013-06-30 57,749.00 2,128.00 10,879.00
2013-03-31 59,426.00 2,248.00 11,135.00
2012-12-31 59,020.00 2,235.00 10,969.00
2012-09-30 58,550.00 2,180.50 10,821.50

*GAAP earnings excluding extraordinary items.

Performance last year
We want to ensure a company is making the most of what it has available. This is done by comparing the return (profit) to a company's available funds, assets and capital.
  • Wesfarmers has efficiently used shareholders’ funds last year (Return on Equity greater than 20%).
  • Wesfarmers used its assets more efficiently than the Oceania Multiline Retail industry average last year based on Return on Assets.
  • Wesfarmers has significantly improved its use of capital last year versus 3 years ago (Return on Capital Employed).
X
Past performance checks
We assess Wesfarmers's performance over the past 5 years by checking for:
  1. Has earnings increased in past 5 years? (1 check)
  2. Has the earnings growth in the last year exceeded that of the Multiline Retail industry? (1 check)
  3. Is the recent earnings growth over the last year higher than the average annual growth over the past 5 years? (1 check)
  4. Is the Return on Equity (ROE) higher than 20%? (1 check)
  5. Is the Return on Assets (ROA) above industry average? (1 check)
  6. Has the Return on Capital Employed (ROCE) increased from 3 years ago? (1 check)
The above checks will fail if the company has reported a loss in the most recent earnings report. Some checks require at least 3 or 5 years worth of data.
Wesfarmers has a total score of 6/6, see the detailed checks below.

Note: We use GAAP Net Income excluding extraordinary items in all our calculations.

Full details on the Past part of the Simply Wall St company analysis model.

Health

 How is Wesfarmers's financial health and their level of debt?

A company's financial position is much like your own financial position, it includes everything you own (assets) and owe (liabilities).

The boxes below represent the relative size of what makes up Wesfarmers's finances.

The net worth of a company is the difference between its assets and liabilities.
Net Worth
  • Wesfarmers is able to meet its short term (1 year) commitments with its holdings of cash and other short term assets.
  • Wesfarmers's cash and other short term assets cover its long term commitments.
Balance sheet
This treemap shows a more detailed breakdown of Wesfarmers's finances. If any of them are yellow this indicates they may be out of proportion and red means they relate to one of the checks below.
Assets
Liabilities and shares
The 'shares' portion represents any funds contributed by the owners (shareholders) and any profits.
  • High level of physical assets or inventory.
  • Debt is covered by short term assets, assets are 2.5x debt.
Historical Debt
Nearly all companies have debt. Debt in itself isn’t bad, however if the debt is too high, or the company can’t afford to pay the interest on its debts this may have impacts in the future.

The graphic below shows equity (available funds) and debt, we ideally want to see the red area (debt) decreasing.

If there is any debt we look at the companies capability to repay it, and whether the level has increased over the past 5 years.
Raw Data

All data from Wesfarmers Company Filings, last reported 6 months ago.

ASX:WES Past Debt and Equity Data
Date (Data in AUD Millions) Total Equity Total Debt Cash & Short Term Investments
2018-12-31 11,292.00 3,478.00 2,942.00
2018-09-30 11,292.00 3,478.00 2,942.00
2018-06-30 22,754.00 4,124.00 683.00
2017-12-31 22,829.00 5,437.00 1,842.00
2017-09-30 22,829.00 5,437.00 1,842.00
2017-06-30 23,941.00 5,413.00 1,013.00
2017-03-31 23,941.00 5,413.00 1,013.00
2016-12-31 23,767.00 6,074.00 738.00
2016-09-30 23,767.00 6,074.00 738.00
2016-06-30 22,949.00 7,303.00 611.00
2016-03-31 22,949.00 7,303.00 611.00
2015-12-31 24,962.00 6,282.00 694.00
2015-09-30 24,962.00 6,282.00 694.00
2015-06-30 24,781.00 6,528.00 711.00
2015-03-31 24,781.00 6,528.00 711.00
2014-12-31 24,744.00 6,143.00 1,505.00
2014-09-30 24,744.00 6,143.00 1,505.00
2014-06-30 25,987.00 5,065.00 2,067.00
2013-12-31 25,729.00 6,433.00 2,660.00
2013-09-30 25,729.00 6,433.00 2,660.00
2013-06-30 26,022.00 5,816.00 2,649.00
2013-03-31 26,022.00 5,816.00 2,371.00
2012-12-31 25,874.00 5,808.00 2,972.00
2012-09-30 25,874.00 5,808.00 2,972.00
  • Wesfarmers's level of debt (30.8%) compared to net worth is satisfactory (less than 40%).
  • The level of debt compared to net worth has increased over the past 5 years (25% vs 30.8% today).
  • Debt is well covered by operating cash flow (91.1%, greater than 20% of total debt).
  • Interest payments on debt are well covered by earnings (EBIT is 23.2x coverage).
X
Financial health checks
We assess Wesfarmers's financial health by checking for:
  1. Are short term assets greater than short term liabilities? (1 check)
  2. Are short term assets greater than long term liabilities? (1 check)
  3. Has the debt to equity ratio increased in the past 5 years? (1 check)
  4. Is the debt to equity ratio over 40%? (1 check)
  5. Is the debt covered by operating cash flow? (1 check)
  6. Are earnings greater than 5x the interest on debt (if company pays interest at all)? (1 check)
  7. Wesfarmers has a total score of 5/6, see the detailed checks below.
For companies that are loss making and have been so on average in the past we replace the last 2 checks with:
  1. Does cash and short term investments cover stable operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)
  2. Does cash and short term investments cover growing operating expenses (recurring G&A and R&D) for more than 3 years? (1 check)


Full details on the Health part of the Simply Wall St company analysis model.

Dividends

 What is Wesfarmers's current dividend yield, its reliability and sustainability?

Dividends are regular cash payments to you from the company, similar to a bank paying you interest on a savings account.
Annual Dividend Income
Dividend payments
5.72%
Current annual income from Wesfarmers dividends. Estimated to be 4.11% next year.
If you bought A$2,000 of Wesfarmers shares you are expected to receive A$114 in your first year as a dividend.
Dividend Amount
Here we look how much dividend is being paid, if any. Is it above what you can get in a savings account? It is up there with the best dividend paying companies?
  • Wesfarmers's pays a higher dividend yield than the bottom 25% of dividend payers in Australia (2.55%).
  • Wesfarmers's dividend is below the markets top 25% of dividend payers in Australia (5.77%).
Annualized Historical and Future Dividends
It is important to see if the dividend for a company is stable, and not wildly increasing/decreasing each year. This graph shows you the historical rate to count toward your assessment of the stock.

We also check to see if the dividend has increased in the past 10 years.
Raw Data
ASX:WES Annualized Past and Future Dividends
Data Point Source Value
Past Annualized Dividend Yield S&P Global Market Data See Below
Past Dividends per Share Company Filings/ Annualized Dividend Payments See Below
Future Dividends per Share Estimates Average of up to 12 Analyst Estimates (S&P Global) See Below
Global Multiline Retail Industry Average Dividend Yield Market Cap Weighted Average of 32 Stocks 3.5%
Australia Market Average Dividend Yield Market Cap Weighted Average of 415 Stocks 4.1%
Australia Minimum Threshold Dividend Yield 10th Percentile 1.5%
Australia Bottom 25% Dividend Yield 25th Percentile 2.6%
Australia Top 25% Dividend Yield 75th Percentile 5.8%

Industry and Market average data is calculated daily.

Note all dividend per share amounts are annualized and not quarterly or other period.

ASX:WES Future Dividends Estimate Data
Date (Data in A$) Dividend per Share (annual) Avg. No. Analysts
2023-06-30 1.81 1.00
2022-06-30 1.73 3.00
2021-06-30 1.58 11.00
2020-06-30 1.53 13.00
2019-06-30 2.62 12.00
ASX:WES Past Annualized Dividends Data
Date (Data in A$) Dividend per share (annual) Avg. Yield (%)
2019-02-20 2.200 6.158
2018-09-17 2.230 5.965
2018-08-14 2.230 4.340
2018-02-20 2.230 4.950
2017-08-16 2.400 5.632
2017-02-14 1.980 4.672
2016-09-28 1.860 4.429
2015-08-20 2.000 4.888
2014-11-27 1.940 4.561
2014-10-02 1.933 4.458
2013-08-15 1.855 4.269
2012-08-16 1.700 4.357
2011-09-22 1.546 4.927
2011-08-18 1.546 4.955
2011-02-17 1.391 4.253
2010-09-24 1.288 3.802
2010-08-19 1.288 3.809
2010-02-18 1.185 3.819
2009-08-20 1.133 3.958
2009-02-16 1.906 8.772
2008-08-21 2.061 9.812

Learn more about our ratios and growth rates in Simply Wall St’s analysis model >

  • Dividends per share have been volatile in the past 10 years (annual drop of over 20%).
  • Dividends per share have increased over the past 10 years.
Current Payout to shareholders
What portion of Wesfarmers's earnings are paid to the shareholders as a dividend.
  • Dividends paid are covered by earnings (1.2x coverage).
Future Payout to shareholders
  • Dividends after 3 years are expected to be covered by earnings (1.1x coverage).
X
Income/ dividend checks
We assess Wesfarmers's dividend by checking for:
  1. Firstly is the company paying a notable dividend (greater than 1.5%) - if not then the rest of the checks are ignored.
  2. Is current dividend yield above the bottom 25% of dividend payers? (1 check)
  3. Is current dividend yield above the top 25% of dividend payers? (1 check)
  4. Have they paid a dividend for 10 years, and during this period has the dividend been volatile (drop of more than 25%)? (1 check)
  5. If they have paid a dividend for 10 years has it increased in this time? (1 check)
  6. How sustainable is the dividend, can Wesfarmers afford to pay it from its earnings today and in 3 years (Payout ratio less than 90%)? (2 checks)
  7. Wesfarmers has a total score of 4/6, see the detailed checks below.


Full details on the Dividends part of the Simply Wall St company analysis model.

Management

 What is the CEO of Wesfarmers's salary, the management and board of directors tenure and is there insider trading?

Management is one of the most important areas of a company. We look at unreasonable CEO compensation, how long the team and board of directors have been around for and insider trading.
CEO
Rob Scott
COMPENSATION A$6,550,230
AGE 49
TENURE AS CEO 1.7 years
CEO Bio

Mr. Robert G. Scott, also known as Rob, has been Managing Director, Chief Executive Officer and Executive Director of Wesfarmers Limited since November 16, 2017. Mr. Scott served as Deputy Chief Executive Officer at Wesfarmers Limited since February 14, 2017 until November 14, 2017. Mr. Scott served as Managing Director of Wesfarmers Industrials Division at Wesfarmers Limited since August 2015 until July 1, 2017. Mr. Scott served as Managing Director of Wesfarmers Chemicals, Energy & Fertilisers at Wesfarmers Limited since August 2015. Mr. Scott served as Finance Director of Coles at Wesfarmers Limited since February 1, 2013. He served as Finance Director at Coles Group Limited since February 1, 2013. Mr. Scott served as Managing Director of Financial Services at Wesfarmers Limited. He joined Wesfarmers in 1993. He has experience in investment banking and financial services with Deutsche Bank in Australia and Asia. Mr. Scott served as Managing Director of Insurance Division at Wesfarmers Ltd. from 2007 to February 2013. He served as Deputy Managing Director of Insurance Division of Wesfarmers Ltd. since June 2007 and Executive General Manager of Strategic Development for its Insurance Division since May 2006. Mr. Buckley worked for Wesfarmers from 1993 to 1994. Mr. Scott started with Wesfarmers in 1993 before moving into investment banking, where he held various roles in corporate finance and mergers and acquisitions in Australia and Asia. He rejoined Wesfarmers in business development in 2004. He served as the President of the Insurance Council of Australia. He served as Chairman of the Board at Lumley General Insurance (N.Z.) Limited. He served as a Director of the Insurance Council of Australia. He is dual Olympian in the sport of rowing and was a silver medallist at the Atlanta Olympics.

CEO Compensation
  • Rob's compensation has been consistent with company performance over the past year, both up more than 20%.
  • Rob's remuneration is about average for companies of similar size in Australia.
Management Team Tenure

Average tenure and age of the Wesfarmers management team in years:

1.7
Average Tenure
49.5
Average Age
  • The average tenure for the Wesfarmers management team is less than 2 years, this suggests a new team.
Management Team

Rob Scott

TITLE
MD & Director
COMPENSATION
A$7M
AGE
49
TENURE
1.7 yrs

Anthony Gianotti

TITLE
Chief Financial Officer
COMPENSATION
A$3M
AGE
50
TENURE
1.7 yrs

Mike Schneider

TITLE
MD of Bunnings Group and MD of Bunnings Australia & New Zealand
COMPENSATION
A$4M
AGE
48
TENURE
2.2 yrs

David Baxby

TITLE
Managing Director of Industrials Division
COMPENSATION
A$3M
AGE
46
TENURE
1.9 yrs

Guy Russo

TITLE
COMPENSATION
A$5M
AGE
59
TENURE
0.7 yrs

John Durkan

TITLE
Senior Advisor
COMPENSATION
A$5M
AGE
55
TENURE
0.8 yrs

Maya vanden Driesen

TITLE
Group General Counsel
TENURE
4.5 yrs

Cathy Bolt

TITLE
Media & External Affairs Manager

Jenny Bryant

TITLE
Chief Human Resources Officer
TENURE
2.8 yrs

Ian Bailey

TITLE
Head of the Australian Conglomerate's Department Stores Division & Managing Director of Kmart
TENURE
0.7 yrs
Board of Directors Tenure

Average tenure and age of the Wesfarmers board of directors in years:

7.6
Average Tenure
60
Average Age
  • The tenure for the Wesfarmers board of directors is about average.
Board of Directors

Michael Chaney

TITLE
Non Executive Chairman
COMPENSATION
A$780K
AGE
69
TENURE
3.7 yrs

Rob Scott

TITLE
MD & Director
COMPENSATION
A$7M
AGE
49

Tony Howarth

TITLE
Independent Non-Executive Director
COMPENSATION
A$424K
AGE
67
TENURE
12 yrs

Wayne Osborn

TITLE
Independent Non-Executive Director
COMPENSATION
A$291K
AGE
68
TENURE
9.3 yrs

Diane Smith-Gander

TITLE
Independent Non-Executive Director
COMPENSATION
A$279K
AGE
61
TENURE
9.9 yrs

Vanessa Wallace

TITLE
Independent Non-Executive Director
COMPENSATION
A$265K
AGE
56
TENURE
9 yrs

Jennifer Westacott

TITLE
Independent Non-Executive Director
COMPENSATION
A$279K
AGE
59
TENURE
6.3 yrs

Bill English

TITLE
Non-Executive Director
COMPENSATION
A$47K
AGE
57
TENURE
1.3 yrs

Mike Roche

TITLE
Non-Executive Director
TENURE
0.4 yrs
Who owns this company?
Recent Insider Trading
  • No 3 month individual insider trading information.
Recent Insider Transactions
Announced Type Name Entity Role Start End Shares Max Price (A$) Value (A$)
13. Dec 18 Sell BlackRock, Inc. Company 25. Jan 17 12. Dec 18 -19,834,194 A$52.67 A$0
13. Dec 18 Buy BlackRock, Inc. Company 25. Jan 17 12. Dec 18 26,327,034 A$52.53 A$101,891
X
Management checks
We assess Wesfarmers's management by checking for:
  1. Is the CEO's compensation unreasonable compared to market cap? (1 check)
  2. Has the CEO's compensation increased more than 20% whilst the EPS is down more then 20%? (1 check)
  3. Is the average tenure of the management team less than 2 years? (1 check)
  4. Is the average tenure of the board of directors team less than 3 years? (1 check)
  5. Wesfarmers has a total score of 0/6, this is not included on the snowflake, see the detailed checks below.


Note: We use the top 6 management executives and board members in our calculations.

Note 2: Insider trading include any internal stakeholders and these transactions .

Full details on the Management part of the Simply Wall St company analysis model.

News

Simply Wall St News

Wesfarmers (ASX:WES) Shares Have Generated A Total Return Of 15% In The Last Year

So while the Wesfarmers Limited (ASX:WES) share price is down 24% in the last year, the total return to shareholders (which includes dividends) was 15%. … As well as measuring the share price return, investors should also consider the total shareholder return (TSR). … A Different Perspective It's nice to see that Wesfarmers shareholders have received a total shareholder return of 15% over the last year.

Simply Wall St -

Wesfarmers Limited (ASX:WES) Has A ROE Of 11%

While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. … One way to conceptualize this, is that for each A$1 of shareholders' equity it has, the company made A$0.11 in profit. … Return on Equity = Net Profit ÷ Shareholders' Equity

Simply Wall St -

Wesfarmers Limited (ASX:WES): A Look At Return On Capital

This share represents a portion of capital used by the company to operate the business, and it is important the company is able to use the capital base efficiently to create adequate cash flows for you as an investor. … Thus, to understand how your money can grow by investing in Wesfarmers, you need to look at what the company returns to owners for the use of their capital, which can be done in many ways but today we will use return on capital employed (ROCE) … What is Return on Capital Employed (ROCE)?

Simply Wall St -

Was Wesfarmers Limited's (ASX:WES) Earnings Decline Part Of A Broader Industry Downturn?

Commentary On WES's Past Performance. … WES's trailing twelve-month earnings (from 30 June 2018) of AU$2.6b has? … Furthermore, this one-year growth rate has been lower than its average earnings growth rate over the past 5 years of -2.0%, indicating the rate at which WES is growing has slowed down

Simply Wall St -

Is Wesfarmers Limited's (ASX:WES) ROE Of 11% Impressive?

While some investors are already well versed in financial metrics (hat tip), this article is for those who would like to learn about Return On Equity (ROE) and why it is important. … Our data shows Wesfarmers has a return on equity of 11% for the last year. … Return on Equity = Net Profit ÷ Shareholders' Equity

Simply Wall St -

Will Wesfarmers Limited's (ASX:WES) Earnings Grow In The Next Couple Of Years?

Wesfarmers Limited's (ASX:WES) most recent earnings announcement in June 2018a … signalled … business

Simply Wall St -

Wesfarmers Limited (ASX:WES): The Yield That Matters The Most

What is free cash flow. … Free cash flow (FCF) is the amount of cash Wesfarmers has left after it pays off its expenses, including its net capital expenditures, which is what the company needs to spend each year to maintain or grow its business operations. … I will be analysing Wesfarmers’s FCF by looking at its FCF yield and its operating cash flow growth.

Simply Wall St -

Does Wesfarmers Limited (ASX:WES) Have A Place In Your Portfolio?

Dividends can be underrated but they form a large part of investment returns, playing an important role in compounding returns in the long run. … In the past 10 years Wesfarmers Limited (ASX:WES) has returned an average of 5.00% per year to investors in the form of dividend payouts. … Let's dig deeper into whether Wesfarmers should have a place in your portfolio.

Simply Wall St -

What Are Analysts Saying About Wesfarmers Limited's (ASX:WES) Growth?

Based on Wesfarmers Limited's (ASX:WES) earnings update in June 2018,. … with earnings expected to grow by 29.91% in the upcoming year … the past 5-year average growth rate of -3.08%

Simply Wall St -

Who Are The Major Shareholders In Wesfarmers Limited (ASX:WES)?

In this analysis, my focus will be on developing a perspective on Wesfarmers Limited’s (ASX:WES) latest ownership structure, a less discussed, but important factor. … Ownership structure of a company has been found to affect share performance over time. … ASX:WES Ownership Summary July 23rd 18

Simply Wall St -

Company Info

Description

Wesfarmers Limited engages in the retail, coal mining and production, gas processing and distribution, industrial and safety product distribution, chemicals and fertilizers manufacturing, and investment businesses in Australia, New Zealand, the United Kingdom, and internationally. The company operates 809 Coles supermarkets; 899 liquor stores under the Liquorland, Vintage Cellars, and First Choice Liquor brands; 88 hotels; 711 convenience outlets; and an online supermarket. It also offers home, car, and landlord insurance products, as well as credit cards; home improvement and outdoor living products through warehouse stores, smaller format stores, trade centers, and frame and truss sites, as well as online under the Bunnings name; apparel, homewares, and general merchandise through 303 Target stores, 228 Kmart stores, and online; automotive services, repairs, and tires through 256 Kmart Tyre & Auto Service centers; and office products and solutions through Officeworks stores and online. In addition, the company supplies building materials; retails office and technology products; manufactures and supplies ammonia, ammonium nitrate, industrial chemicals, polyvinyl chloride resins, wood-plastic composite decking and screening products, and sodium cyanide; extracts and distributes LPG and LNG; and manufactures, imports, and distributes phosphate, nitrogen, and potassium-based fertilizers. Further, the company supplies industrial supplies and safety products; provides risk management and compliance services; offers industrial and corporate workwear; manufactures and markets industrial gases and equipment; and holds interests in the Bengalla coal mines. Wesfarmers Limited was founded in 1914 and is headquartered in Perth, Australia.

Details
Name: Wesfarmers Limited
WES
Exchange: ASX
Founded: 1914
A$43,221,980,800
1,133,840,000
Website: http://www.wesfarmers.com.au
Address: Wesfarmers Limited
Brookfield Place Tower 2,
Level 14,
Perth,
Western Australia, 6000,
Australia
Listings
Exchange Symbol Ticker Symbol Security Exchange Country Currency Listed on
ASX WES Ordinary Shares Australian Securities Exchange AU AUD 02. Jan 1992
OTCPK WFAF.F Ordinary Shares Pink Sheets LLC US USD 02. Jan 1992
DB WF3 Ordinary Shares Deutsche Boerse AG DE EUR 02. Jan 1992
CHIA WES Ordinary Shares Chi-X Australia AU AUD 02. Jan 1992
OTCPK WFAF.Y ADR NEW 2014 Pink Sheets LLC US USD 16. Oct 2008
Number of employees
Current staff
Staff numbers
105,000
Wesfarmers employees.
Industry
General Merchandise Stores
Retail
Company Analysis and Financial Data Status
Area Date (UTC time)
Company Analysis updated: 2019/07/19 10:33
End of day share price update: 2019/07/19 00:00
Last estimates confirmation: 2019/07/14
Last earnings filing: 2019/02/20
Last earnings reported: 2018/12/31
Last annual earnings reported: 2018/06/30


All dates and times in UTC. All financial data provided by Standard & Poor’s Capital IQ.

Unless specified all financial data is based on a yearly period but updated quarterly. This is known as Trailing Twelve Month (TTM) or Last Twelve Month (LTM) Data. Learn more here.