May 1, 2025
Top 10 Stock Wendy's Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Wendy's – Top 10 Stock in S&P Mid-Cap Index
Wendy's is listed as a top 10 stock on May 01, 2025 in the market index S&P MIDCAP because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 62 (high 62% performer), Obermatt assesses an overall buy recommendation for Wendy's on May 01, 2025.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Restaurants |
| Index | Dividends USA, Diversity USA, NASDAQ, S&P MIDCAP |
| Size class | Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Wendy's Buy
| 360 METRICS | May 1, 2025 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 63 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 45 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 69 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 41 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 62 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 62 (better than 62% compared with alternatives), overall professional sentiment and financial characteristics for the stock Wendy's are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Wendy's. The consolidated Value Rank has an attractive rank of 63, which means that the share price of Wendy's is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 63% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 69. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 41. Professional investors are more confident in 59% other stocks. The consolidated Growth Rank also has a low rank of 45, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 55 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 62, Wendy's is better positioned than 62% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 63), and the financing structure is on the safer side (Safety Rank of 69). However, sentiment in the professional investor community is below-average (Sentiment Rank of 41), as is the growth momentum for the company (Growth Rank of 45). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for Wendy's only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 41 (better than 41% compared with alternatives), overall professional sentiment and engagement for the stock Wendy's is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Wendy's. Analyst Opinions are at a rank of 10 (worse than 90% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 19, which means that stock research experts are getting even more pessimistic. Other sentiment indicators are positive: The Professional Investors rank is 57, which means that professional investors hold more stock in this company than in 57% of alternative investment opportunities. So, pros tend to favor investing in this company. In addition, Market Pulse has a rank of 82, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 82% of competitors). While stock research analysts are getting ever more critical, many professional investors are committed to Wendy's and the professional news channels are on the positive side. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 41 (less encouraging than 59% compared with investment alternatives), Wendy's has a reputation among professional investors that is below that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical, while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: Wendy's Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 63 (better than 63% compared with alternatives), Wendy's shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Wendy's. Price-to-Profit (also referred to as price-earnings, P/E) is 67 which means that the stock price compared with what market professionals expect for future profits is lower than for 67% of comparable companies, indicating a good value concerning Wendy's's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 3, which means that the stock price is lower as regards to invested capital than for 3% of comparable investments. On the other hand, Price-to-Sales is less favorable than 58% of alternatives (only 42% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 3% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 63, is a buy recommendation based on Wendy's's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. ...read more
Growth Strategy: Wendy's Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 45 (better than 45% compared with alternatives), Wendy's shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for Wendy's. Only Capital Growth has a good rank of 84, which means that currently professionals expect the company to grow its invested capital more than 25% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 44 which means that currently professionals expect the company to grow less than 56% of its competitors. Profit Growth with a rank of 25 and Stock Returns with a rank of 33 are also low (below 67% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 45, is a hold recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Wendy's is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. ...read more
Safety Strategy: Wendy's Debt Financing Safety above-average
| SAFETY METRICS | May 1, 2025 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 33 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 94 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 52 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 69 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 69 (better than 69% compared with alternatives), the company Wendy's has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Wendy's is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for Wendy's. Refinancing is at 94, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 94% of its competitors. Liquidity is also good at 52, meaning the company generates more profit to service its debt than 52% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 33, which means the company has an above-average debt-to-equity ratio. It has more debt than 67% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 69 (better than 69% compared with alternatives), Wendy's has a financing structure that is safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Wendy's could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. ...read more
Combined financial peformance: Wendy's Top Financial Performance
| COMBINED PERFORMANCE | May 1, 2025 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 63 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 45 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 52 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 78 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 78 (better than 78% compared with investment alternatives), Wendy's (Restaurants, USA) shares have much better financial characteristics than comparable stocks. Shares of Wendy's are a good value (attractively priced) with a consolidated Value Rank of 63 (better than 63% of alternatives), are safely financed (Safety Rank of 69, which means low debt burdens), but show below-average growth (Growth Rank of 45). ...read more
RECOMMENDATION: A Combined Rank of 78, is a strong buy recommendation based on Wendy's's financial characteristics. As the company Wendy's's key financial metrics exhibit good value (Obermatt Value Rank of 63) but low growth (Obermatt Growth Rank of 45) while being safely financed (Obermatt Safety Rank of 69), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 63% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.