Wayfair Inc. (NYSE: W)

Sector: Consumer Cyclical Industry: Internet Retail CIK: 0001616707
Market Cap 14.95 Bn
P/B -5.40
P/E -46.01
P/S 1.22
ROIC (Qtr) -20.07
Div Yield % 0.00
Rev 1y % (Qtr) 8.08
Total Debt (Qtr) 3.61 Bn
Debt/Equity (Qtr) -1.30

About

Wayfair Inc., often recognized by its stock symbol W, is a prominent player in the home goods industry. Through its e-commerce platform, the company offers a visually appealing browsing experience, attractive pricing, and a wide range of products that cater to various demographics and income levels. Wayfair's operations span across several reportable segments, including the United States, Canada, the United Kingdom, Germany, and Ireland. Wayfair's primary business activities revolve around providing furniture, décor, housewares, and home improvement...

Read more

Price action

Investment thesis

Bull case

  • Retained earnings of (4.71B) represent substantial 1.70x of equity (2.77B), indicating strong internal capital generation.
  • Operating cash flow of 494M fully covers other non-current liabilities 25M by 19.76x, showing strong long-term stability.
  • Cash reserves of 1.17B provide solid 46.84x coverage of other non-current liabilities 25M, indicating strong liquidity.
  • Operating cash flow of 494M provides strong 7.06x coverage of inventory 70M, indicating efficient inventory management.
  • Cash reserves of 1.17B exceed inventory value of 70M by 16.73x, indicating strong liquidity and inventory management.

Bear case

  • Operating cash flow of 494M barely covers its investment activities of (234M), with a coverage ratio of -2.11, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • The company's operating cash flow of 494M shows concerning coverage of stock compensation expenses of 338M, with a 1.46 ratio indicating potential earnings quality issues.
  • Operating earnings of (219M) show weak coverage of depreciation charges of 324M, with a -0.68 ratio indicating high capital intensity and potential reinvestment needs.
  • Free cash flow of 286M represents just -0.89x of debt issuance (321M), suggesting concerning reliance on leverage rather than internal cash generation for growth.
  • High depreciation of 324M relative to operating cash flow of 494M, which is 0.66x suggests significant maintenance capital requirements affecting free cash flow.

Segments Breakdown of Revenue (2024)

Peer comparison

Companies in the Internet Retail
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 AMZN Amazon Com Inc 2,526.56 Bn 33.03 3.65 135.42 Bn
2 BABA Alibaba Group Holding Ltd 395.87 Bn 22.47 2.79 39.55 Bn
3 PDD PDD Holdings Inc. 149.89 Bn 10.44 2.55 1.50 Bn
4 MELI Mercadolibre Inc 106.40 Bn 51.23 4.06 9.88 Bn
5 DASH DoorDash, Inc. 88.88 Bn 103.00 7.03 3.26 Bn
6 SE Sea Ltd 73.28 Bn 51.67 3.48 4.24 Bn
7 EBAY Ebay Inc 64.91 Bn 5.04 6.46 7.02 Bn
8 JD JD.com, Inc. 42.35 Bn 9.36 0.23 15.74 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 5.58 1.64
EV to Cash from Ops. EV/CFO 35.18 10.76
EV to Debt EV to Debt 4.82 18.39
EV to EBIT EV/EBIT -79.36 20.59
EV to EBITDA EV/EBITDA 124.15 20.75
EV to Free Cash Flow [EV/FCF] EV/FCF 60.77 16.58
EV to Market Cap EV to Market Cap 1.16 -3.15
EV to Revenue EV/Rev 1.42 -4.05
Price to Book Value [P/B] P/B -5.40 5.50
Price to Earnings [P/E] P/E -46.01 36.85
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 0.00 -93.84
Dividend Payout Ratio % Div Payout % (Qtr) 0.00 -203.90
Dividend per Basic Share Div per Share (Qtr) 0.00 0.08
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 0.00 -3.46
Interest Coverage Int. cover (Qtr) -2.26 -1,581.43
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) 22.96 -39.45
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -9.65 53.91
Dividend Growth (1y) % Dividend Growth (1y) % 0.00 1.00
EBIAT Growth (1y) % EBIAT 1y % (Qtr) 56.74 37.93
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 222.81 -62.59
EBIT Growth (1y) % EBIT 1y % (Qtr) 57.06 8.33
EBT Growth (1y) % EBT 1y % (Qtr) 40.04 -10.66
EPS Growth (1y) % EPS 1y % (Qtr) 42.63 13.44
FCF Growth (1y) % FCF 1y % (Qtr) 565.12 -46.02
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 3.33 23.19
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 3.93 1.17
Cash Payout Ratio Cash Payout (Qtr) 0.00 -0.04
Cash Ratio Cash Ratio (Qtr) 0.52 2.14
Current Ratio Curr Ratio (Qtr) 0.74 3.56
Debt to Equity Ratio Debt/Equity (Qtr) -1.30 0.52
Interest Cover Ratio Int Coverage (Qtr) -2.26 -1,581.43
Times Interest Earned Times Interest Earned (Qtr) -2.26 -1,581.43
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 0.90 4.40
EBIT Margin % EBIT Margin % (Qtr) -1.79 -36.99
EBT Margin % EBT Margin % (Qtr) -2.58 -40.80
Gross Margin % Gross Margin % (Qtr) 30.20 44.74
Net Profit Margin % Net Margin % (Qtr) -2.70 -40.62