Wesfarmers Limited (WES) AI Stock Analysis

• Market Cap: AU$95.44B
• Dividend Yield: 2.45%
• Average Volume (3M): 1.42M
• Price to Earnings (P/E): 36.7
• Beta (1Y): 1.13
• Revenue Growth: 3.04%
• EPS Growth: 3.65%
• Country: AU
• Employees: 120,000
• Sector: Consumer Cyclical
• Sector Strength: 73
• Industry: Home Improvement
• EPS (TTM): 1.29
• Shares Outstanding: 1,134,780,800
• 10 Day Avg. Volume: 1,388,064
• 30 Day Avg. Volume: 1,423,632
• PEG Ratio: 26.37
• Price to Book (P/B): 10.14
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 28.23
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: AU$73.19
• Price Target Upside: -13.49% Downside
• Rating Consensus: Moderate Sell
• Number of Analyst Covering: 11

• Rating: 75 Outperform
• Price Target: AU$95.00 ▲(12.29%Upside)

Wesfarmers Limited's overall stock score is driven by its strong financial performance and positive earnings call highlights. Despite a stretched valuation and some technical indicators suggesting an overbought condition, the company’s strategic initiatives and robust operational performance across key segments provide a solid growth outlook.

Positive Factors

Earnings Performance

WES reported strong 2H24/FY24 results with FY24 group revenue of A$44.2B +1.5% YoY and group EBIT of A$4.0B +3.3% YoY.

Market Position

Wesfarmers continues to gain market share and maintain resilient margins.

Negative Factors

Growth Outlook

The Bunnings segment has shown a softer outlook with a first 8-week run-rate below expected growth.

Wesfarmers Limited Business Overview & Revenue Model

Company Description

Wesfarmers Limited engages in the retail business in Australia, New Zealand, the United Kingdom, and internationally. The company is involved in the retail sale of building materials, home and garden improvement, and outdoor living products through its Bunnings stores; apparel and general merchandise, including toys, leisure, entertainment, home, and consumables; and office products and solutions, such as stationery, technology, furniture, art supplies, and learning and development resources, as well as print and create, and technical support services through its 168 Officeworks stores. It also provides hardware and software repairs, system security solutions, wireless and wired networking services, virus and spyware prevention and removal, and data backup and recovery solutions. In addition, the company manufactures and supplies ammonia, ammonium nitrate, and industrial chemicals; manufactures, imports, and distributes phosphate, nitrogen, and potassium-based fertilizers; supplies polyvinyl chloride resins; produces wood-plastic composite products; and manufactures and distributes sodium cyanide. Further, it produces and distributes liquefied petroleum gas and liquefied natural gas; supplies and distributes maintenance, repair, operating products, and industrial safety products and services; manufacturers and markets industrial, medical, and specialty gases; supplies tools, safety gear, personal protective equipment, electricals, work wear, and industrial supplies; and provides risk management and compliance services, as well as footwear; safety products, uniforms, engineering supplies, and packaging services; and engages in other businesses. Additionally, the company provides health, beauty, and wellbeing products; clinical cosmetic and skin care treatments; retail support services; distributes pharmaceutical goods; and operates online marketplace and data sharing platform. Wesfarmers Limited was founded in 1914 and is headquartered in Perth, Australia.

How the Company Makes Money

Wesfarmers Limited generates revenue primarily through its retail operations, which account for the majority of its income. The company's retail brands, including Bunnings Warehouse, Kmart, Target, and Officeworks, contribute significantly to its earnings by selling a wide range of products from home improvement and office supplies to clothing and general merchandise. In addition to retail, Wesfarmers has significant operations in the industrials sector, including chemicals and fertilizers through its subsidiary CSBP, and industrial and safety products through Blackwoods. The company also engages in energy production and distribution, which adds to its diversified revenue streams. Strategic acquisitions and partnerships further bolster its market presence and financial performance.

Wesfarmers Limited Financial Statement Overview

Summary

Wesfarmers Limited demonstrates solid financial health with consistent revenue growth, strong profitability, and effective cash flow management. The company maintains impressive returns on equity and robust cash flow metrics, though it carries moderate leverage.

Income Statement

Wesfarmers Limited has shown a steady growth in revenue, with a revenue growth rate of approximately 1.45% from 2023 to 2024. The gross profit margin is strong at 34.56%, and the net profit margin is healthy at 5.80%. The EBIT and EBITDA margins are 8.42% and 12.61%, respectively, indicating solid core profitability and operational efficiency.

Balance Sheet

The company maintains a moderate debt-to-equity ratio of 1.31, highlighting a balanced approach to leveraging equity with debt. The return on equity stands at 29.79%, reflecting strong profitability relative to shareholder equity. However, the equity ratio is 31.44%, indicating a moderate reliance on external financing.

Cash Flow

Wesfarmers has demonstrated positive cash flow generation with a free cash flow growth rate of 21.68% from 2023 to 2024. The operating cash flow to net income ratio is 1.80, signifying robust cash generation relative to net income. The free cash flow to net income ratio is 1.38, underscoring the company's strong cash conversion capabilities.

Breakdown
TTM	Jun 2024	Jun 2023	Jun 2022	Jun 2021	Jun 2020
Income Statement		Total Revenue
44.92B	44.05B	43.42B	36.68B	33.80B	30.75B
	Gross Profit
11.18B	15.22B	6.48B	5.83B	5.91B	4.93B
	EBIT
5.63B	3.71B	3.83B	3.36B	3.61B	2.69B
	EBITDA
5.26B	5.55B	5.55B	5.04B	5.12B	4.06B
	Net Income Common Stockholders
2.60B	2.56B	2.46B	2.35B	2.38B	1.70B
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
487.00M	835.00M	673.00M	705.00M	3.02B	2.91B
	Total Assets
27.71B	27.31B	27.14B	28.05B	26.88B	26.02B
	Total Debt
10.82B	11.28B	11.17B	12.08B	10.13B	9.90B
	Net Debt
10.34B	10.44B	10.50B	11.38B	7.10B	6.99B
	Total Liabilities
18.74B	18.72B	18.86B	20.07B	17.17B	16.67B
	Stockholders Equity
8.97B	8.59B	8.28B	7.98B	9.71B	9.34B
Cash Flow		Free Cash Flow
3.23B	3.52B	2.89B	1.16B	2.51B	3.68B
	Operating Cash Flow
4.27B	4.59B	4.18B	2.30B	3.38B	4.55B
	Investing Cash Flow
-1.03B	-1.37B	-552.00M	-1.19B	-642.00M	642.00M
	Financing Cash Flow
-3.56B	-3.06B	-3.66B	-3.43B	-2.63B	-3.07B

Wesfarmers Limited Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 84.60
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Positive
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For AU:WES, the sentiment is Positive. The current price of 84.6 is above the 20-day moving average (MA) of 82.45, above the 50-day MA of 77.62, and above the 200-day MA of 72.82, indicating a bullish trend. The MACD of 1.72 indicates Positive momentum. The RSI at 73.59 is Negative, neither overbought nor oversold. The STOCH value of 84.41 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for AU:WES.

Wesfarmers Limited Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
WES	75 Outperform	AU$95.44B	36.71	30.35%	2.45%	3.04%	3.65%
Sector *	62 Neutral	$6.93B	11.25	2.95%	3.88%	2.69%	-24.71%
WOLWF		$25.28B	23.07	32.27%	3.12%	―	―
CLEGF		$19.25B	25.65	30.87%	3.18%	―	―
HNORF		$4.35B	15.13	9.58%	4.58%	―	―
MCSHF		$2.45B	13.58	19.53%	5.16%	―	―
SUL	73 Outperform	AU$3.22B	14.23	17.52%	4.83%	2.56%	-13.62%

Wesfarmers Limited Corporate Events

Wesfarmers Raises EUR600 Million in Oversubscribed Eurobond Issuance

Wesfarmers Limited has successfully priced EUR600 million in seven-year senior unsecured notes, which will mature in June 2032. The issuance, under the company’s EUR 3 billion Euro Medium Term Note Programme, was heavily oversubscribed, reflecting strong investor demand in European and Asian markets. The proceeds, to be swapped into Australian dollars, will be used for general corporate purposes, taking advantage of favorable market conditions and diversifying the company’s debt maturity profile. The notes will be listed on the Singapore Exchange but not offered to retail investors in Australia.

The most recent analyst rating on (AU:WES) stock is a Hold with a A$69.00 price target. To see the full list of analyst forecasts on Wesfarmers Limited stock, see the AU:WES Stock Forecast page.

Leadership Transition at Officeworks: John Gualtieri to Succeed Sarah Hunter

Wesfarmers Limited announced a leadership transition at Officeworks, with Sarah Hunter stepping down as Managing Director in August 2025, to be succeeded by John Gualtieri, the current CEO of Kmart and Target. This transition is seen as a strategic move to leverage Gualtieri’s extensive retail experience to drive Officeworks’ next phase of growth, focusing on strengthening omnichannel customer experiences and expanding technology and business-to-business operations.

The most recent analyst rating on (AU:WES) stock is a Hold with a A$69.00 price target. To see the full list of analyst forecasts on Wesfarmers Limited stock, see the AU:WES Stock Forecast page.

Wesfarmers Unveils Strategic Vision at 2025 Briefing Day

Wesfarmers Limited announced its 2025 Strategy Briefing Day presentation, scheduled for 22 May 2025, which will be webcasted for broader accessibility. This event is expected to provide insights into the company’s strategic direction and operational plans, potentially impacting its market positioning and stakeholder engagement.

The most recent analyst rating on (AU:WES) stock is a Hold with a A$69.00 price target. To see the full list of analyst forecasts on Wesfarmers Limited stock, see the AU:WES Stock Forecast page.

Wesfarmers Appoints New Director Julie Ann Coates

Wesfarmers Limited has announced the appointment of Julie Ann Coates as a director. The initial director’s interest notice indicates that Coates holds 3,000 fully paid ordinary shares through Good Coates Pty Limited on behalf of the Good Coates Family. This appointment and shareholding disclosure are part of the company’s compliance with ASX listing rules, ensuring transparency and accountability in its governance practices.

Wesfarmers Director Increases Shareholding

Wesfarmers Limited announced a change in the director’s interest, with Friedrich (Tom) von Oertzen acquiring an additional 1,000 fully paid ordinary shares, bringing his total to 2,000 shares. This acquisition was conducted through an on-market trade, reflecting the director’s increased investment in the company, which may indicate confidence in Wesfarmers’ future performance and stability.

Wesfarmers Director Increases Shareholding

Wesfarmers Limited announced a change in the director’s interest, with Simon William (Bill) English acquiring 73 additional fully paid ordinary shares through the company’s Dividend Investment Plan. This change reflects a minor adjustment in the director’s shareholding, potentially indicating confidence in the company’s performance and future prospects.

Wesfarmers Hosts Bunnings Investor Briefing and Site Tour

Wesfarmers Limited announced an investor briefing and site tour for its subsidiary Bunnings, scheduled for March 27, 2025. This event, which will be webcast, reflects the company’s ongoing commitment to transparency and engagement with stakeholders, potentially impacting its market perception and investor relations positively.

Wesfarmers Sets Dividend Investment Plan Allocation Price for 2025

Wesfarmers Limited has announced the allocation price for its Dividend Investment Plan shares at $71.4337 for the interim dividend related to the six-month period ending December 31, 2024. This price was determined based on the average daily volume weighted average price of the company’s shares over a 15-day trading period. With 11.50% of shareholders opting to participate in the plan, shares are set to be issued on April 1, 2025, reflecting the company’s ongoing commitment to shareholder value.

Wesfarmers Updates Dividend Distribution Details

Wesfarmers Limited announced an update to its previous dividend distribution announcement, specifically regarding the Dividend Reinvestment Plan (DRP) price and participation details. The payment date for the dividend is set for April 1, 2025, with specific conditions for shares issued under the Key Executive Equity Performance Plan. This update reflects the company’s ongoing commitment to shareholder returns and provides clarity on the financial arrangements for stakeholders.