TSX:NWC

Stock Analysis Report

Executive Summary

The North West Company Inc., through its subsidiaries, engages in the retail of food and everyday products and services to rural communities and urban neighborhood markets in Canada, Alaska, the South Pacific, and the Caribbean.

Snowflake

Fundamentals

Solid track record and fair value.


Similar Companies

Share Price & News

How has North West's share price performed over time and what events caused price changes?


Latest Share Price and Events


Market Performance


7 Day Return

-0.3%

NWC

-2.0%

CA Consumer Retailing

0.1%

CA Market


1 Year Return

-0.7%

NWC

24.8%

CA Consumer Retailing

1.6%

CA Market

Return vs Industry: NWC underperformed the Canadian Consumer Retailing industry which returned 24.8% over the past year.

Return vs Market: NWC underperformed the Canadian Market which returned 1.6% over the past year.


Shareholder returns

NWCIndustryMarket
7 Day-0.3%-2.0%0.1%
30 Day-3.1%-2.1%-2.9%
90 Day-4.4%4.1%-1.4%
1 Year3.8%-0.7%33.3%24.8%5.2%1.6%
3 Year23.2%8.1%27.0%16.1%13.8%3.7%
5 Year50.3%20.7%83.7%62.0%25.3%7.2%

Price Volatility Vs. Market

How volatile is North West's share price compared to the market and industry in the last 5 years?


Simply Wall St News

Valuation

Is North West undervalued compared to its fair value and its price relative to the market?

45.4%

Undervalued compared to fair value


Share Price vs. Fair Value

Undervalued: NWC (CA$28.07) is trading below our estimate of fair value (CA$51.43)

Significantly Undervalued: NWC is trading below fair value by more than 20%.


Price To Earnings Ratio

PE vs Industry: NWC is good value based on its PE Ratio (14.6x) compared to the Consumer Retailing industry average (20.8x).

PE vs Market: NWC is poor value based on its PE Ratio (14.6x) compared to the Canadian market (13.7x).


Price to Earnings Growth Ratio

Low PEG Ratio: Insufficient data to calculate NWC's PEG Ratio to determine if it is good value.


Price to Book Ratio

PB vs Industry: NWC is overvalued based on its PB Ratio (3.4x) compared to the CA Consumer Retailing industry average (2.1x).


Next Steps

Future Growth

How is North West forecast to perform in the next 1 to 3 years based on estimates from 5 analysts?

-9.9%

Forecasted annual earnings growth


Earnings and Revenue Growth Forecasts


Analyst Future Growth Forecasts

Earnings vs Savings Rate: NWC's earnings are forecast to decline over the next 3 years (-9.9% per year).

Earnings vs Market: NWC's earnings are forecast to decline over the next 3 years (-9.9% per year).

High Growth Earnings: NWC's earnings are forecast to decline over the next 3 years.

Revenue vs Market: NWC's revenue (3.6% per year) is forecast to grow slower than the Canadian market (5.8% per year).

High Growth Revenue: NWC's revenue (3.6% per year) is forecast to grow slower than 20% per year.


Earnings per Share Growth Forecasts


Future Return on Equity

High Future ROE: Insufficient data to determine if NWC's Return on Equity is forecast to be high in 3 years time


Next Steps

Past Performance

How has North West performed over the past 5 years?

6.8%

Historical annual earnings growth


Earnings and Revenue History


Past Earnings Growth Analysis

Earnings Trend: NWC's earnings have grown by 6.8% per year over the past 5 years.

Accelerating Growth: NWC's earnings growth over the past year (31.2%) exceeds its 5-year average (6.8% per year).

Earnings vs Industry: NWC earnings growth over the past year (31.2%) exceeded the Consumer Retailing industry 8.9%.


Return on Equity

High ROE: NWC's Return on Equity (23.4%) is considered high.


Return on Assets

ROA vs Industry: NWC has a higher Return on Assets than the Consumer Retailing industry average last year.


Return on Capital Employed

ROCE Improving: NWC's Return on Capital Employed has declined over the past 3 years.


Next Steps

Financial Health

How is North West's financial position?


Financial Position Analysis

Short Term Liabilities: NWC's short term assets (CA$411.9M) exceeds its short term liabilities (CA$188.6M)

Long Term Liabilities: NWC's short term assets (411.9M) do not cover its long term liabilities (587.9M)


Debt to Equity History and Analysis

Debt Level: NWC's debt to equity ratio (96.7%) is considered high

Reducing Debt: NWC's debt to equity ratio has increased from 64.7% to 96.7% over the past 5 years.

Debt Coverage: NWC's debt is well covered by operating cash flow (34.1%).

Interest Coverage: NWC's interest payments on its debt are well covered by EBIT (7.7x coverage).


Balance Sheet

Inventory Level: NWC has a high level of physical assets or inventory.

Debt Coverage by Assets: NWC's debt is covered by short term assets (assets are 1.022260x debt).


Next Steps

Dividend

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

4.70%

Current Dividend Yield


Dividend Yield vs Market

company4.7%marketbottom25%2.0%markettop25%6.0%industryaverage1.3%forecastin3Years4.7%

Current dividend yield vs market & industry


Stability and Growth of Payments

Notable Dividend: NWC's dividend (4.7%) is higher than the bottom 25% of dividend payers in the Canadian market (2.01%).

High Dividend: NWC's dividend (4.7%) is low compared to the top 25% of dividend payers in the Canadian market (6.01%).

Stable Dividend: NWC's dividend payments have been volatile in the past 10 years.

Growing Dividend: NWC's dividend payments have fallen over the past 10 years.


Current Payout to Shareholders

Dividend Coverage: With its reasonable payout ratio (67.6%), NWC's dividend payments are covered by earnings.


Future Payout to Shareholders

Future Dividend Coverage: Insufficient data to determine if a dividend will be paid in 3 years and that it will be covered by earnings.


Next Steps

Management

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

2.1yrs

Average management tenure


CEO

Edward Kennedy (59yo)

22.8yrs

Tenure

CA$3,315,367

Compensation

Mr. Edward S. Kennedy has been the Chief Executive Officer and President of The North West Company Inc., since 1997 and its Executive since 1989 and serves as its Director since 1996. Mr. Kennedy has been  ...


CEO Compensation Analysis

Compensation vs. Market: Edward's total compensation ($USD2.52M) is about average for companies of similar size in the Canadian market ($USD1.55M).

Compensation vs Earnings: Edward's compensation has been consistent with company performance over the past year.


Management Age and Tenure

2.1yrs

Average Tenure

Experienced Management: NWC's management team is considered experienced (2.1 years average tenure).


Board Age and Tenure

9.5yrs

Average Tenure

65yo

Average Age

Experienced Board: NWC's board of directors are considered experienced (9.5 years average tenure).


Insider Trading

Insider Buying: Insufficient data to determine if insiders have bought more shares than they have sold in the past 3 months.


Recent Insider Transactions

BuyCA$10,00820 Dec 18
Eric Stefanson
EntityIndividual
Role
Member of the Board of Directors
Independent Director
Shares324
Max PriceCA$30.89

Ownership Breakdown


Management Team

  • Edward Kennedy (59yo)

    President

    • Tenure: 22.8yrs
    • Compensation: CA$3.32m
  • Craig Gilpin

    Executive VP & Chief Corporate Officer

    • Tenure: 9.6yrs
    • Compensation: CA$1.29m
  • John King

    Executive VP & CFO

    • Tenure: 9.3yrs
    • Compensation: CA$1.18m
  • Dan McConnell

    President of International Retail

    • Tenure: 0yrs
    • Compensation: CA$1.53m
  • Gary Merasty (54yo)

    Executive VP & Chief Development Officer

    • Tenure: 1.8yrs
    • Compensation: CA$936.02k
  • Amanda Sutton

    VP of Legal & Corporate Secretary

    • Tenure: 2.1yrs
  • Beth Millard-Hales

    Vice President of Human Resources

    • Tenure: 1.5yrs
  • Frank Kelner

    President of North Star Air Ltd.

    • Tenure: 2.8yrs
  • Toby Noiles

    Executive Vice President of Canadian Food Procurement & Marketing

    • Tenure: 1.8yrs
  • Alex Yeo

    President of Canadian Retail

    • Tenure: 1.8yrs

Board Members

  • Sandy Riley (68yo)

    Independent Chairman

    • Tenure: 11.3yrs
    • Compensation: CA$240.00k
  • Eric Stefanson (68yo)

    Independent Director

    • Tenure: 7.8yrs
    • Compensation: CA$135.50k
  • Edward Kennedy (59yo)

    President

    • Tenure: 22.8yrs
    • Compensation: CA$3.32m
  • Frank Coleman (65yo)

    Independent Director

    • Tenure: 20.8yrs
    • Compensation: CA$125.00k
  • Bob Kennedy (69yo)

    Independent Director

    • Tenure: 16.8yrs
    • Compensation: CA$137.00k
  • Vi Konkle (65yo)

    Independent Director

    • Tenure: 5.6yrs
    • Compensation: CA$122.00k
  • Annalisa King (52yo)

    Independent Director

    • Tenure: 4.8yrs
    • Compensation: CA$119.00k
  • Stewart Glendinning (54yo)

    Independent Director

    • Tenure: 4.9yrs
    • Compensation: CA$123.50k
  • Wendy Evans (68yo)

    Independent Director

    • Tenure: 14.8yrs
    • Compensation: CA$131.50k
  • Victor Tootoo (54yo)

    Independent Director

    • Tenure: 4.3yrs
    • Compensation: CA$119.00k

Company Information

The North West Company Inc.'s company bio, employee growth, exchange listings and data sources


Key Information

  • Name: The North West Company Inc.
  • Ticker: NWC
  • Exchange: TSX
  • Founded: 1668
  • Industry: Food Retail
  • Sector: Consumer Retailing
  • Market Cap: CA$1.368b
  • Shares outstanding: 48.75m
  • Website: https://www.northwest.ca

Number of Employees


Location

  • The North West Company Inc.
  • Gibraltar House
  • 77 Main Street
  • Winnipeg
  • Manitoba
  • R3C 2R1
  • Canada

Listings

TickerExchangePrimary SecuritySecurity TypeCountryCurrencyListed on
NNWW.FOTCPK (Pink Sheets LLC)YesCommon Voting SharesUSUSDSep 1990
NWCTSX (The Toronto Stock Exchange)YesCommon Voting SharesCACADSep 1990

Biography

The North West Company Inc., through its subsidiaries, engages in the retail of food and everyday products and services to rural communities and urban neighborhood markets in Canada, Alaska, the South Paci ...


Company Analysis and Financial Data Status

All financial data provided by Standard & Poor's Capital IQ.
DataLast Updated (UTC time)
Company Analysis2019/10/18 00:21
End of Day Share Price2019/10/17 00:00
Earnings2019/07/31
Annual Earnings2019/01/31


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.