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WCC

WESCO International NYSE:WCC Stock Report

Last Price

US$142.33

Market Cap

US$7.1b

7D

6.9%

1Y

24.1%

Updated

15 Aug, 2022

Data

Company Financials +
WCC fundamental analysis
Snowflake Score
Valuation5/6
Future Growth1/6
Past Performance5/6
Financial Health3/6
Dividends0/6

WCC Stock Overview

WESCO International, Inc. provides business-to-business distribution, logistics services, and supply chain solutions in the United States, Canada, and internationally.

WESCO International, Inc. Competitors

Price History & Performance

Summary of all time highs, changes and price drops for WESCO International
Historical stock prices
Current Share PriceUS$142.33
52 Week HighUS$144.43
52 Week LowUS$99.00
Beta2.15
1 Month Change36.54%
3 Month Change12.68%
1 Year Change24.07%
3 Year Change221.36%
5 Year Change185.52%
Change since IPO611.65%

Recent News & Updates

Aug 16

WESCO International: Revising My Expectations Higher

WESCO International has done really well in recent months, with strong fundamental performance pushing sales and profits higher. The company is particularly cheap on an absolute basis if we assume that 2022 forecasts turn out to be accurate. Though not the best prospect around, the company does seem to offer some upside potential moving forward as well. In recent years, the supply chain has become incredibly important. Strong demand combined with supply constraints has led to a number of problems, the biggest of which is inflation. But not every company has suffered during this timeframe. Some, particularly those that are integrally connected with the supply chain, have benefited. A great example of this can be seen by looking at WESCO International (WCC). This enterprise has its hands in a few different areas. For instance, it does provide products and supply chain solutions to other businesses, with examples of products being fasteners, cutting tools, safety products, and more. It's also involved in network infrastructure, security, and other related activities as well. On the supply side of things, it's focused on offering inventory management and product packaging for its customers. Truly, the list goes on. Recently, fundamental performance achieved by the company has been rather strong. And when you consider the expectation for the near term, the company looks quite cheap as well. Although the company is not the cheapest player in the space, it does seem to offer some upside potential moving forward. And as such, I've decided to increase my rating on the business from a 'hold' to a soft 'buy'. Understanding recent strength Back in January of this year, I wrote an article that took something of a neutral stance on WESCO International. I acknowledged at that time that the company had exhibited rapid growth over the past few years, driven in part by acquisition activities that it had engaged in. I also said that the company's future was looking bright. Having said that, I felt like, at the time, its stock was more or less fairly valued. This led me to rate the company a 'hold', reflecting my belief that its shares would experience returns that are more or less similar to what the broader market would. Since then, however, I have proven to be quite wrong. While the S&P 500 has dropped by 6%, shares of WESCO International have generated a return for investors of 11.7%. Author - SEC EDGAR Data This increase in share price is no coincidence. To understand exactly why it happened, we need only look at recent financial performance. Consider, for starters, how the business finished off its 2021 fiscal year. Sales for the year came in at $18.22 billion. That represents an increase of 47.8% over the $12.33 billion generated just one year earlier. Much of this increase came as a result of the company's merger with Anixter back in late 2020. However, the company did site double-digit growth across all segments, while price increases helped to the tune of 3%. Unfortunately, management doesn't give a more specific breakdown of the details. So we can't know exactly how much of the increase was attributed to other causes like increased volume of goods shipped. This strength in sales brought with it a rise in profitability. Net income shot up from $70.5 million in 2020 to $408 million last year. Operating cash flow for the business declined from $543.9 million to $67.1 million. But if we adjust for changes in working capital, it would have risen from $513.8 million to $598.6 million. Meanwhile, EBITDA for the company also increased, climbing from $660.3 million to $1.18 billion. Author - SEC EDGAR Data Strength for the company has continued into the 2022 fiscal year. According to management, revenue in the first half of the year came in strong at $10.42 billion. That's 20.6% higher than the $8.64 billion generated in the first half of 2021. Unlike from 2020 to 2021 when we saw a significant portion of the increase in sales attributed to its aforementioned merger, the increase from 2021 to 2022 was driven by strong organic sales growth of 21%. Growth was strongest under the UBS segment of the company, which focuses on utility and broadband solutions. Year over year, growth here was 29.5%, driven by the passing on of rising costs to customers and as the number of workdays positively impacted the company to the tune of 0.8%. Naturally, this had a positive impact on profitability as well. Net income rose from $149.7 million in the first half of last year to $373.2 million the same time this year. Operating cash flow went from $102.8 million to negative $304.5 million. But if we adjust for changes in working capital, it actually would have nearly doubled from $280.2 million to $532.5 million. Meanwhile, EBITDA for the company grew nicely, shooting up from $525.8 million to $808.6 million. For the 2022 fiscal year as a whole, management has some pretty bullish expectations. Revenue, for instance, should grow by between 16% and 18% year over year. At the midpoint, that would translate to sales of $21.32 billion. Earnings per share, meanwhile, should come in at between $15.60 and $16.40. At the midpoint, this will translate to net income of $835.52 million. The company is also forecasting EBITDA of $1.68 billion. No guidance was given when it came to operating cash flow. But if we assume that it will increase at the same rate that EBITDA should, then we should anticipate a reading, net of preferred distributions, of $797.7 million. Normally, preferred distributions are not stripped out from operating cash flow. In fact, they never are. But because I see them as a mandatory cash outflow, I do like to strip them out to see the amount of cash flow going to common shareholders.

Aug 15
An Intrinsic Calculation For WESCO International, Inc. (NYSE:WCC) Suggests It's 46% Undervalued

An Intrinsic Calculation For WESCO International, Inc. (NYSE:WCC) Suggests It's 46% Undervalued

Today we will run through one way of estimating the intrinsic value of WESCO International, Inc. ( NYSE:WCC ) by taking...

Jul 13
Here's Why WESCO International (NYSE:WCC) Has A Meaningful Debt Burden

Here's Why WESCO International (NYSE:WCC) Has A Meaningful Debt Burden

Some say volatility, rather than debt, is the best way to think about risk as an investor, but Warren Buffett famously...

Shareholder Returns

WCCUS Trade DistributorsUS Market
7D6.9%4.7%3.6%
1Y24.1%5.7%-9.6%

Return vs Industry: WCC exceeded the US Trade Distributors industry which returned 4.8% over the past year.

Return vs Market: WCC exceeded the US Market which returned -10.2% over the past year.

Price Volatility

Is WCC's price volatile compared to industry and market?
WCC volatility
WCC Average Weekly Movement7.3%
Trade Distributors Industry Average Movement6.6%
Market Average Movement7.7%
10% most volatile stocks in US Market16.9%
10% least volatile stocks in US Market3.2%

Stable Share Price: WCC is not significantly more volatile than the rest of US stocks over the past 3 months, typically moving +/- 7% a week.

Volatility Over Time: WCC's weekly volatility (7%) has been stable over the past year.

About the Company

FoundedEmployeesCEOWebsite
192218,000John Engelhttps://www.wesco.com

WESCO International, Inc. provides business-to-business distribution, logistics services, and supply chain solutions in the United States, Canada, and internationally. It operates through three segments: Electrical & Electronic Solutions (EES), Communications & Security Solutions (CSS), and Utility and Broadband Solutions (UBS). The EES segment supplies products and supply chain solutions, including electrical equipment and supplies, automation and connected devices, security, lighting, wire and cable, and safety, as well as maintenance, repair, and operating (MRO) products.

WESCO International, Inc. Fundamentals Summary

How do WESCO International's earnings and revenue compare to its market cap?
WCC fundamental statistics
Market CapUS$7.12b
Earnings (TTM)US$631.55m
Revenue (TTM)US$20.00b

11.4x

P/E Ratio

0.4x

P/S Ratio

Earnings & Revenue

Key profitability statistics from the latest earnings report
WCC income statement (TTM)
RevenueUS$20.00b
Cost of RevenueUS$15.74b
Gross ProfitUS$4.25b
Other ExpensesUS$3.62b
EarningsUS$631.55m

Last Reported Earnings

Jun 30, 2022

Next Earnings Date

n/a

Earnings per share (EPS)12.43
Gross Margin21.28%
Net Profit Margin3.16%
Debt/Equity Ratio123.8%

How did WCC perform over the long term?

See historical performance and comparison