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Established in 1914, Wesfarmers Ltd. (ASX: WES) is a major Australian retail conglomerate selling chemicals, fertilisers, industrial wares and safety products. It is based in Perth, Western Australia and its main markets are Australia and New Zealand. It is one of Australia's largest earning companies and reported a revenue of $30.8 billion for 2020. It employs a staff of 107,000, making it one of the largest private employers in Australia.
How to buy shares in Wesfarmers
Compare share trading platforms. To buy shares listed in Australia, you'll need to sign up to a broker with access to the Australian Securities Exchange (ASX). Our table below can help you choose.
Open and fund your brokerage account. Complete an application with your personal and financial details, like your ID and tax file number. Fund your account with a bank transfer, PayPal or debit card.
Search for Wesfarmers. Find the share by name or ticker symbol: WES. Research its history to confirm it's a solid investment against your financial goals.
Purchase now or later. Buy today with a market order or use a limit order to delay your purchase until Wesfarmers reaches your desired price. To spread out your risk, look into dollar-cost averaging, which smooths out buying at consistent intervals and amounts.
Decide on how many to buy. At today's price, weigh your budget against a diversified portfolio that can minimise risk through the market's ups and downs.
Check in on your investment. Congratulations, you own a part of Wesfarmers. Optimise your portfolio by tracking how your stock — and even the business — performs with an eye on the long term. You may be eligible for dividends and shareholder voting rights on directors and management that can affect your stock.
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The technical analysis gauge below displays real-time ratings for the timeframes you select. This is not a recommendation, however. It represents a technical analysis based on the most popular technical indicators: Moving Averages, Oscillators and Pivots. Finder might not concur and takes no responsibility.
Historical closes compared with the last close of A$55.24
1 month (2021-06-28)
-5.56%
3 months (2021-04-28)
0.07%
Is Wesfarmers under- or over-valued?
Valuing Wesfarmers stock is incredibly difficult, and any metric has to be viewed as part of a bigger picture of Wesfarmers's overall performance. However, analysts commonly use some key metrics to help gauge the value of a stock.
Wesfarmers's P/E ratio
Wesfarmers's current share price divided by its per-share earnings (EPS) over a 12-month period gives a "trailing price/earnings ratio" of roughly 37x. In other words, Wesfarmers shares trade at around 37x recent earnings.
That's relatively high compared to, say, the P/E ratio for the ASX over the 12 months to December 2019 (32.14). The high P/E ratio could mean that investors are optimistic about the outlook for the shares or simply that they're over-valued.
Wesfarmers's EBITDA
Wesfarmers's EBITDA (earnings before interest, taxes, depreciation and amortisation) is $3.8 billion.
The EBITDA is a measure of a Wesfarmers's overall financial performance and is widely used to measure a its profitability.
Wesfarmers financials
Revenue TTM
$33.4 billion
Operating margin TTM
10.01%
Gross profit TTM
$11.3 billion
Return on assets TTM
8.09%
Return on equity TTM
19.5%
Profit margin
5.63%
Book value
8.477
Market capitalisation
$69.6 billion
TTM: trailing 12 months
Wesfarmers's environmental, social and governance track record
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 Wesfarmers.
When it comes to ESG scores, lower is better, and lower scores are generally associated with lower risk for would-be investors.
Wesfarmers's total ESG risk score
Total ESG risk: 15.98
Socially conscious investors use ESG scores to screen how an investment aligns with their worldview, and Wesfarmers's overall score of 15.98 (as at 12/31/2018) is excellent – landing it in it in the 11st percentile of companies rated in the same sector.
ESG scores are increasingly used to estimate the level of risk a company like Wesfarmers 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.).
Wesfarmers's environmental score
Environmental score: 7.35/100
Wesfarmers's environmental score of 7.35 puts it squarely in the 5th percentile of companies rated in the same sector. This could suggest that Wesfarmers is a leader in its sector terms of its environmental impact, and exposed to a lower level of risk.
Wesfarmers's social score
Social score: 8.36/100
Wesfarmers's social score of 8.36 puts it squarely in the 5th percentile of companies rated in the same sector. This could suggest that Wesfarmers is a leader in its sector when it comes to taking good care of its workforce and the communities it impacts.
Wesfarmers's governance score
Governance score: 5.27/100
Wesfarmers's governance score puts it squarely in the 5th percentile of companies rated in the same sector. That could suggest that Wesfarmers is a leader in its sector when it comes to responsible management and strategy, and exposed to a lower level of risk.
Wesfarmers's controversy score
Controversy score: 2/5
ESG scores also evaluate any incidences of controversy that a company has been involved in. Wesfarmers scored a 2 out of 5 for controversy – the second-highest score possible, reflecting that Wesfarmers has, for the most part, managed to keep its nose clean.
Environmental, social, and governance (ESG) summary
Wesfarmers Limited was last rated for ESG on: 2019-01-01.
Total ESG score
15.98
Total ESG percentile
10.76
Environmental score
7.35
Environmental score percentile
5
Social score
8.36
Social score percentile
5
Governance score
5.27
Governance score percentile
5
Level of controversy
2
Wesfarmers share dividends
Dividend payout ratio: 63.47% of net profits
Recently Wesfarmers has paid out, on average, around 63.47% of net profits as dividends. That has enabled analysts to estimate a "forward annual dividend yield" of 2.87% of the current stock value. This means that over a year, based on recent payouts (which are sadly no guarantee of future payouts), Wesfarmers shareholders could enjoy a 2.87% return on their shares, in the form of dividend payments. In Wesfarmers's case, that would currently equate to about A$1.65 per share.
Wesfarmers'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 22 February 2021 (the "ex-dividend date").
Have Wesfarmers's shares ever split?
Wesfarmers's shares were split on a 9:10 basis on 25 November 2014. So if you had owned 10 shares the day before before the split, the next day you'd have owned 9 shares. This wouldn't directly have changed the overall worth of your Wesfarmers shares – just the quantity. However, indirectly, the new 11.1% higher share price could have impacted the market appetite for Wesfarmers shares which in turn could have impacted Wesfarmers's share price.
Wesfarmers share price volatility
Over the last 12 months, Wesfarmers's shares have ranged in value from as little as $42.7726 up to $61.93. 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 (AU average) beta is 1, while Wesfarmers's is 0.5591. This would suggest that Wesfarmers's shares are less volatile than average (for this exchange).
Wesfarmers overview
Wesfarmers Limited primarily engages in the retail business in Australia, New Zealand, the United Kingdom, and internationally. It is involved in the retail sale of building materials, and home and garden improvement products through its Bunnings stores; apparel, homewares, and general merchandise, including toys, leisure, entertainment, home, consumables, electrical products, and accessories; and office products and solutions, such as office supplies, technology, furniture, art supplies, education resources, and helpful services, including print and copy and on-site tech support through its 167 Officeworks stores. The company also manufactures and supplies ammonia, ammonium nitrate, and industrial chemicals; manufactures, imports, and distributes phosphate, nitrogen, and potassium-based fertilizers in blended, compound, and liquid form; supplies polyvinyl chloride resins used in a range of products comprising piping, cable insulation, floor coverings, building profiles, packaging, and compounds; produces wood-plastic composite products from recycled wood and plastic; and manufactures and distributes sodium cyanide, which is used in the mining industry for gold extraction. In addition, it extracts, markets, and distributes liquefied petroleum gas and liquefied natural gas; distributes tools, safety gear, work wear, and industrial supplies; supplies industrial, specialty, and medical gases; supplies and distributes maintenance, repair, and operating products; and provides risk management and compliance services, as well as offers property management services. Further, the company provides its products online. Wesfarmers Limited was founded in 1914 and is headquartered in Perth, Australia.
Currently 1.056% of Wesfarmers shares are held by insiders and 23.6% by institutions.
Wesfarmers's fiscal year ends in June.
Wesfarmers's address is: Brookfield Place Tower 2, Perth, WA, Australia, 6000
Wesfarmers's international securities identification number is: AU000000WES1
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