George Weston (WN.TO)
Consumer · TSX · Canada
Fundamentals
Valuation and ratings
George Weston trades at C$103.12, close to the C$103.95 our discounted cash flow model puts on the business. On this measure the market and the model broadly agree, so the interesting question is which of them is wrong.
Our moat model scores it 43 out of 100, which is little in the way of a moat. A moat is a structural reason competitors cannot take the profits away, and it matters more to a long holding period than any single quarter's numbers do.
It changes hands at 37.4 times earnings. Be careful reading that in isolation: for a cyclical business a low P/E arrives at the top of the cycle, when profits are peaking and about to fall, which is exactly when the shares look cheapest and are not.
About George Weston
George Weston Limited provides food and drug retailing, and financial services in Canada. The company operates in two segments, Loblaw Companies Limited (Loblaw) and Choice Properties Real Estate Investment Trust (Choice Properties). The Loblaw segment provides grocery, corporate and franchise-owned retail food, and associate-owned drug stores, including in-store pharmacies, health care services, health and beauty products, apparel, and other general merchandise. This segment offers credit card and banking services, guaranteed investment certificates, loyalty program, insurance brokerage services, and telecommunication services. The Choice Properties segment owns, develops, and manages commercial and residential properties, which are leased to necessity-based tenants and logistics providers. The company markets its products under the Shoppers Drug Mart, Joe Fresh, President's Choice Bank, PC Financial, no name, Farmer's Market, T&T, Life Brand, and PC Optimum brands. The company was founded in 1882 and is based in Toronto, Canada. George Weston Limited is a subsidiary of Wittington Investments, Limited.
Common questions
Is George Weston (WN.TO) undervalued?
Against our discounted cash flow estimate of C$103.95, WN.TO at C$103.12 is 1% below fair value. That is one model's answer, not a recommendation, and most of a DCF's output sits in a terminal value nobody can forecast.
What is WN.TO's P/E ratio?
WN.TO trades at 37.4 times earnings. A low P/E is not automatically cheap: on a cyclical company it is usually a warning that earnings are at a peak.
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Data from company filings, exchange quotes and SEC EDGAR 13F disclosures. Quotes are delayed. Metrics we do not have are left out rather than estimated. Educational information, not financial advice.