Wendy's Company (WEN)
NASDAQ:WEN
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Wendy's
(NASDAQ:WEN)
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Rating:60Neutral
Price Target:
$8.00
▲(15.11% Upside)
Action:Reiterated
Date:05/23/26
The score is held back mainly by high leverage and a sharp TTM revenue decline, plus earnings-call guidance that points to continued near-term pressure from U.S. weakness and store optimization. Offsetting these are an attractive valuation (low P/E and high dividend yield), steady free cash flow generation, and improving near-term technical momentum.
Positive Factors
Free Cash Flow & Operating Cash
Sustained positive operating cash flow (~$319M TTM) and meaningful free cash flow (~$222M TTM) provide durable internal funding for capex, digital investment, dividends and debt service. This cash generation underpins the turnaround while reducing reliance on external financing over the next several quarters.
Negative Factors
High Leverage
Exceptionally high leverage (debt ~$4.1B; debt/equity >35x) materially limits financial flexibility and raises refinancing and interest-rate vulnerability. Elevated leverage constrains investment capacity, heightens default risk if sales disappoint, and makes deleveraging contingent on sustained cash generation.
Read all positive and negative factors
Positive Factors
Negative Factors
Free Cash Flow & Operating Cash
Sustained positive operating cash flow (~$319M TTM) and meaningful free cash flow (~$222M TTM) provide durable internal funding for capex, digital investment, dividends and debt service. This cash generation underpins the turnaround while reducing reliance on external financing over the next several quarters.
Read all positive factors
Wendy's Key Performance Indicators (KPIs)
Any
Total Stores
Indicates the total number of Wendy's locations worldwide, reflecting the brand's scale, market reach, and potential for revenue generation.
Indicates the total number of Wendy's locations worldwide, reflecting the brand's scale, market reach, and potential for revenue generation.
Data provided by:
The Fly
The FlyWendy's (WEN) vs. SPDR S&P 500 ETF (SPY)
Market Cap
$1.49B
Dividend Yield8.15%
Average Volume (3M)11.80M
Price to Earnings (P/E)7.1
Beta (1Y)0.52
Revenue Growth-1.84%
EPS Growth-17.48%
CountryUS
Employees4,833
SectorConsumer Cyclical
Sector Strength84
IndustryRestaurants
Share Statistics
EPS (TTM)0.90
Shares Outstanding190,480,640
10 Day Avg. Volume16,985,822
30 Day Avg. Volume11,803,242
Financial Highlights & Ratios
PEG Ratio-0.93
Price to Book (P/B)13.77
Price to Sales (P/S)0.74
P/FCF Ratio6.66
Enterprise Value/Market Cap3.47
Enterprise Value/Revenue2.35
Enterprise Value/Gross Profit8.94
Enterprise Value/Ebitda10.24
Forecast
1Y Price Target
$7.10Price Target Upside2.16% Upside
Rating ConsensusHold
Number of Analyst Covering16
EPS Forecast (FY)0.58
Revenue Forecast (FY)$2.20B
Wendy's Business Overview & Revenue Model
Company Description
The Wendy's Company, together with its subsidiaries, operates as a quick-service restaurant company. It operates through three segments: Wendy's U.S., Wendy's International, and Global Real Estate & Development. The company is involved in operatin...
How the Company Makes Money
Wendy’s makes money primarily through a mixed model of franchising and company-operated restaurant sales. (1) Franchise-related revenue: A significant portion of Wendy’s earnings comes from its franchised system, where independent restaurant opera...
Wendy's Earnings Call Summary
Earnings Call Date:Feb 13, 2026
(Q4-2025)
| % Change Since: |
Next Earnings Date:Aug 12, 2026
Earnings Call Sentiment Neutral
The call presented a mixed picture: strong, repeatable international growth, solid cash generation and a clear, multi‑pronged turnaround plan (Project Fresh) are notable positives. However, material U.S. sales declines (Q4 U.S. comps down double digits), margin pressure from traffic and inflation, and near-term earnings/headwinds from system optimization and weather create meaningful short-term challenges. Management emphasized active remediation (menu, marketing, operations, store optimization) and provided conservative 2026 guidance reflecting a rebuilding year.Positive Updates
International Growth and Expansion
International system-wide sales grew 6.2% in Q4 and 8.1% for full-year 2025; 159 new international restaurant openings in 2025 (59 in Q4) and 121 net new restaurants (net unit growth >9%); expanded from 31 to 38 international markets and secured development agreements for 338 new restaurants, with similar net new unit guidance for 2026.
Negative Updates
Significant U.S. Sales Declines
Global system-wide sales declined 8.3% in Q4 (constant currency) driven by U.S. weakness; U.S. same-restaurant sales declined 11.3% in Q4 and full-year global system-wide sales declined 3.5% for 2025, highlighting meaningful deterioration in the U.S. business.
Read all updates
Q4-2025 Updates
Positive
Negative
International Growth and Expansion
International system-wide sales grew 6.2% in Q4 and 8.1% for full-year 2025; 159 new international restaurant openings in 2025 (59 in Q4) and 121 net new restaurants (net unit growth >9%); expanded from 31 to 38 international markets and secured development agreements for 338 new restaurants, with similar net new unit guidance for 2026.
Read all positive updates
Company Guidance
Wendy’s 2026 guidance calls for global system‑wide sales to be approximately flat year‑over‑year (with a ~2% benefit from the 53rd week and ~2% from base improvements and international growth, offset by ~4% from system optimization), U.S. same‑restaurant sales expected to improve sequentially through the year, and roughly the same number of international net new units as 2025 (which delivered 121 net new restaurants). Financial targets include adjusted EBITDA of $460–480 million, adjusted EPS of $0.56–0.60, free cash flow of $190–205 million, U.S. company‑operated restaurant margin ~13% ±50 bps (assuming ~4% labor inflation and ~4% commodity inflation), G&A ~ $295 million, interest expense ~ $140 million, an effective tax rate of ~30%, and capital expenditures/build‑to‑suit of $120–130 million (after reducing build‑to‑suit spend by ~$20 million). Project Fresh actions include closing ~5–6% of U.S. restaurants (28 closed in Q4 with the remainder in H1), an expected ~$15–20 million drag on adjusted EBITDA from system optimization, a target net leverage range of 3.5–5.0x (expecting to remain near the top end), year‑end cash of $340 million, a $0.14 quarterly dividend, and roughly $35 million remaining on the current share repurchase authorization.Wendy's Financial Statement Overview
Summary
Income Statement
62
Positive
Balance Sheet
22
Negative
Cash Flow
58
Neutral
| Breakdown | TTM | Dec 2025 | Dec 2024 | Dec 2023 | Dec 2022 | Dec 2021 |
|---|---|---|---|---|---|---|
Income Statement | ||||||
| Total Revenue | 2.19B | 2.18B | 2.25B | 2.18B | 2.10B | 1.90B |
| Gross Profit | 576.85M | 585.00M | 790.01M | 776.47M | 720.76M | 536.66M |
| EBITDA | 503.43M | 524.58M | 554.23M | 552.05M | 501.63M | 475.30M |
| Net Income | 171.46M | 165.07M | 194.36M | 204.44M | 177.37M | 200.39M |
Balance Sheet | ||||||
| Total Assets | 4.92B | 4.96B | 5.03B | 5.18B | 5.50B | 5.10B |
| Cash, Cash Equivalents and Short-Term Investments | 447.18M | 300.83M | 450.51M | 516.04M | 745.89M | 249.44M |
| Total Debt | 4.12B | 4.15B | 4.09B | 4.14B | 4.28B | 3.86B |
| Total Liabilities | 4.81B | 4.84B | 4.78B | 4.87B | 5.03B | 4.66B |
| Stockholders Equity | 115.55M | 117.38M | 259.35M | 309.78M | 465.72M | 436.40M |
Cash Flow | ||||||
| Free Cash Flow | 222.39M | 242.62M | 260.92M | 260.39M | 174.36M | 267.79M |
| Operating Cash Flow | 318.52M | 344.54M | 355.31M | 345.42M | 259.90M | 345.77M |
| Investing Cash Flow | -143.01M | -150.83M | -129.31M | -86.55M | -77.78M | -154.67M |
| Financing Cash Flow | -205.15M | -343.99M | -303.10M | -504.30M | 288.67M | -242.74M |
Wendy's Technical Analysis
Negative
6.95
Price Trends
7.12
Positive
7.44
Negative
8.13
Negative
Market Momentum
0.20
Negative
49.43
Neutral
34.58
Neutral
Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For WEN, the sentiment is Negative. The current price of 6.95 is below the 20-day moving average (MA) of 7.34, below the 50-day MA of 7.12, and below the 200-day MA of 8.13, indicating a neutral trend. The MACD of 0.20 indicates Negative momentum. The RSI at 49.43 is Neutral, neither overbought nor oversold. The STOCH value of 34.58 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Negative sentiment for WEN.
Wendy's Risk Analysis
Wendy's disclosed 33 risk factors in its most recent earnings report. Wendy's reported the most risks in the "Finance & Corporate" category.
Finance & Corporate - Financial and accounting risks. Risks related to the execution of corporate activity and strategy
Latest Risks Added 0 New Risks
Wendy's Peers Comparison
UnderperformOutperform
Sector (61)
Name | Overall Rating | Market Cap | P/E Ratio | ROE | Dividend Yield | Revenue Growth | EPS Growth |
|---|---|---|---|---|---|---|---|
67 Neutral | $3.04B | 12.87 | 38.34% | 2.11% | 5.14% | 8.17% | |
62 Neutral | $3.82B | 35.51 | -15.30% | 0.45% | 8.96% | -32.63% | |
61 Neutral | $18.38B | 12.79 | -2.54% | 3.03% | 1.52% | -15.83% | |
60 Neutral | $1.49B | 7.07 | 150.73% | 8.15% | -1.84% | -17.48% | |
59 Neutral | $10.53B | 22.18 | -15.04% | 1.63% | 5.17% | -0.62% | |
50 Neutral | $1.10B | 36.76 | -6.47% | 4.72% | -2.41% | -64.77% | |
46 Neutral | $220.30M | 5.33 | -3.80% | 9.34% | -17.16% | ― |
* Consumer Cyclical Sector Average
WEN
Wendy's
7.36
-3.19
-30.22%
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Wendy's Corporate Events
Business Operations and StrategyShareholder Meetings
Wendy’s Shareholders Approve Equity Plan and Governance Changes
Positive
May 22, 2026
On May 20, 2026, Wendy’s stockholders approved an amendment to the company’s 2020 Omnibus Award Plan, adding 21 million shares of common stock available for equity-based compensation, a move that could expand its ability to attract and...
Business Operations and StrategyExecutive/Board Changes
Wendy’s Names Bob Wright New CEO and President
Positive
May 20, 2026
On May 17, 2026, The Wendy’s Company’s board appointed Robert D. “Bob” Wright as president and chief executive officer, effective May 21, 2026, with Wright also joining the board and serving on its Capital and Investment an...
Glossary
BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.
Disclaimer
This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.