Whitbread PLC (WTB) is a leading restaurants business based in the UK. Whitbread is listed on the London Stock Exchange (LSE) and employs 35,455 staff. All prices are listed in pence sterling.
Since the stock market crash in March caused by coronavirus, Whitbread's share price has had significant negative movement.
Its last market close was 2073p, which is 56.53% down on its pre-crash value of 4769p and 14.82% up on the lowest point reached during the March crash when the shares fell as low as 1805.5p.
If you had bought £1,000 worth of Whitbread shares at the start of February 2020, those shares would have been worth £531.49 at the bottom of the March crash, and if you held on to them, then as of the last market close they'd be worth £460.41.
|52-week range||1805.5p - 5193.9999p|
|50-day moving average||2138.644p|
|200-day moving average||2320.8767p|
|Wall St. target price||4741.39p|
|Dividend yield||1p (4.03%)|
|Earnings per share (TTM)||145p|
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Valuing Whitbread stock is incredibly difficult, and any metric has to be viewed as part of a bigger picture of Whitbread's overall performance. However, analysts commonly use some key metrics to help gauge the value of a stock.
Whitbread's current share price divided by its per-share earnings (EPS) over a 12-month period gives a "trailing price/earnings ratio" of roughly 18x. In other words, Whitbread shares trade at around 18x recent earnings.
That's relatively low compared to, say, the trailing 12-month P/E ratio for the FTSE 250 at the end of September 2019 (19.71). The low P/E ratio could mean that investors are pessimistic about the outlook for the shares or simply that they're under-valued.
However, Whitbread's P/E ratio is best considered in relation to those of others within the restaurants industry or those of similar companies.
Whitbread's "price/earnings-to-growth ratio" can be calculated by dividing its P/E ratio by its growth – to give 2.27. A low ratio can be interpreted as meaning the shares offer better value, while a higher ratio can be interpreted as meaning the shares offer worse value.
The PEG ratio provides a broader view than just the P/E ratio, as it gives more insight into Whitbread's future profitability. By accounting for growth, it could also help you if you're comparing the share prices of multiple high-growth companies.
However, it's sensible to consider Whitbread's PEG ratio in relation to those of similar companies.
Whitbread's EBITDA (earnings before interest, taxes, depreciation and amortisation) is £631 million.
The EBITDA is a measure of a Whitbread's overall financial performance and is widely used to measure a its profitability.
To put Whitbread's EBITDA into context you can compare it against that of similar companies.
|Revenue TTM||£2.1 billion|
|Operating margin TTM||23.46%|
|Gross profit TTM||£741 million|
|Return on assets TTM||3.4%|
|Return on equity TTM||4.64%|
|Market capitalisation||£4.2 billion|
TTM: trailing 12 months
Environmental, social and governance (known as ESG) criteria are a set of three factors used to measure the sustainability and social impact of companies like Whitbread.
When it comes to ESG scores, lower is better, and lower scores are generally associated with lower risk for would-be investors.
Total ESG risk: 22.15
Socially conscious investors use ESG scores to screen how an investment aligns with their worldview, and Whitbread's overall score of 22.15 (as at 08/01/2020) is pretty good – landing it in it in the 21st percentile of companies rated in the same sector.
ESG scores are increasingly used to estimate the level of risk a company like Whitbread is exposed to within the areas of "environmental" (carbon footprint, resource use etc.), "social" (health and safety, human rights etc.), and "governance" (anti-corruption, tax transparency etc.).
To gain some more context, you can compare Whitbread's total ESG risk score against those of similar companies.
Environmental score: 9.59/100
Whitbread's environmental score of 9.59 puts it squarely in the 6th percentile of companies rated in the same sector. This could suggest that Whitbread is a leader in its sector terms of its environmental impact, and exposed to a lower level of risk.
Social score: 8.89/100
Whitbread's social score of 8.89 puts it squarely in the 6th percentile of companies rated in the same sector. This could suggest that Whitbread is a leader in its sector when it comes to taking good care of its workforce and the communities it impacts.
Governance score: 5.67/100
Whitbread's governance score puts it squarely in the 6th percentile of companies rated in the same sector. That could suggest that Whitbread is a leader in its sector when it comes to responsible management and strategy, and exposed to a lower level of risk.
Controversy score: 2/5
ESG scores also evaluate any incidences of controversy that a company has been involved in. A high-profile company, Whitbread scored a 2 out of 5 for controversy – the second-highest score possible, reflecting that Whitbread has, for the most part, managed to keep its nose clean.
Wondering how that compares? Below are the controversy scores of similar companies.
|Total ESG score||22.15|
|Total ESG percentile||20.66|
|Environmental score percentile||6|
|Social score percentile||6|
|Governance score percentile||6|
|Level of controversy||2|
Dividend payout ratio: 68.76% of net profits
Recently Whitbread has paid out, on average, around 68.76% of net profits as dividends. That has enabled analysts to estimate a "forward annual dividend yield" of 4.03% of the current stock value. This means that over a year, based on recent payouts (which are sadly no guarantee of future payouts), Whitbread shareholders could enjoy a 4.03% return on their shares, in the form of dividend payments. In Whitbread's case, that would currently equate to about 1p per share.
Whitbread's payout ratio would broadly be considered high, and as such this stock could appeal to those looking to generate an income. Bear in mind however that companies should normally also look to re-invest a decent amount of net profits to ensure future growth.
The latest dividend was paid out to all shareholders who bought their shares by 7 November 2019 (the "ex-dividend date").
Whitbread's dividend payout ratio is perhaps best considered in relation to those of similar companies.
Whitbread's shares were split on a 42:47 basis on 8 January 2007. So if you had owned 47 shares the day before before the split, the next day you'd have owned 42 shares. This wouldn't directly have changed the overall worth of your Whitbread shares – just the quantity. However, indirectly, the new 11.9% higher share price could have impacted the market appetite for Whitbread shares which in turn could have impacted Whitbread's share price.
Over the last 12 months, Whitbread's shares have ranged in value from as little as 1805.5p up to 5193.9999p. A popular way to gauge a stock's volatility is its "beta".
Beta is a measure of a share's volatility in relation to the market. The market (LSE average) beta is 1, while Whitbread's is 0.8331. This would suggest that Whitbread's shares are less volatile than average (for this exchange).
To put Whitbread's beta into context you can compare it against those of similar companies.
Whitbread PLC operates hotels and restaurants in the United Kingdom and internationally. It operates approximately 820 hotels with 78,500 rooms under the Premier Inn and the hub by Premier Inn brand names; and restaurants under the Brewers Fayre, Beefeater, Cookhouse & Pub, Bar+Block, Thyme, and Table Table brands. Whitbread PLC was founded in 1742 and is based in Dunstable, the United Kingdom.
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