Wayfair Inc. (XNYS:W) In-Depth Stock/Fundamental/Options Analysis Today

Primary Facts

Name:

WAYFAIR INC. (XNYS:W)

Sector:

- 266000.00K

Industry:

Internet Retail

CEO:

Mr. Niraj Shah

Total Employees:

16,681

Our Technological Advancement Rating

Our Rating:

Technological advancement compared to industry is -98.77% lower

ANALYSIS OF ALL CRITICAL FACTORS & RISKS RELATED TO THE STOCK & FUNDAMENTAL/LONG-TERM ANALYSIS OF WAYFAIR INC.(W) AS PER DATA ANALYSIS OF LAST 3 YEARS AND COMPARISON WITH COMPETITORS/PEERS, AND INTERNET RETAIL INDUSTRY. DATE: 07/09/2022

Primary Targets/Price Insights

Previous Close ($) :

49.68

One Month Price Target:

$50.48

Six Month Price Target :

$54.48

Likely Price in One Year's Time:

Ticker:

$59.28

Likely Trading Range Today Under (Normal Volatility)

$49.23

Price Upper limit ($) :

$50.21

Price Lower limit ($) :

Crash Risk Prep/Key Price Levels (High Volatility/Risk)

Price, as per data analysis, isn't likely to fall below:

Today:

$43.78

This week:

$36.5

This month :

$23.31

Other Primary facts

Market Cap:

5.28B

Market Cap Classification:

Mid Cap

Number of Shares

IPO Date:

106.34M

Best/Worst Daily Performance (Last 3+ Years)

Highest Daily Appreciation:

42.84%

-26.68%

Worst Daily Decline:

Our Options Trading Entry Points

Iron Condor entry points for options expiring in 1 week's time

Low risk (<2%) entry points

Buy Call:

Sell Call:

Buy Put:

Sell Put:

$77.04

$64.51

$22.32

$34.85

Medium risk (<10%) entry points

Buy Call

Sell Call

$60.43

Buy Put:

Sell Put:

$57.76

$38.89

$41.60

These entry points can be used for other strategies, such as butterflies, straddles, etc.

Risk-Adjusted returns (Sharpe Ratio) of

W

Sharpe Ratio:

1.27%

Comparison:

W, is amongst the top 60% stocks with highest risk-adjusted returns

Sharpe ratio is -58.52% lower than the industry

& is -44.19% lower than the market/S&P 500 average

Average Returns/Yield of

W

Daily returns:

0.08%

Weekly returns:

0.41%

Monthly returns:

1.66%

Yearly returns:

37.29%

Comparison of returns:

Average annual returns/yield (last 3 years) is -46.66% below industry average

Classification:

W, is amongst the top 40% highest yielding stocks in terms of daily returns

Results of T-Test of Returns:

0.47

Statistical test of Returns:

W has yielded returns statistically similar to the market

Volatility (measured by Standard Deviation)

Daily Volatility:

5.82%

Weekly Volatility:

13.01%

Monthly Volatility:

26.02%

Yearly Volatility:

90.15%

Volitlilty of last five days (Measured by Standard Deviation)

Average Volatility of this Week:

0.89%

Volatility in last five trading days has been -84.65% below long-term volatility

Value at Risk Analysis (VaR)

Daily VaR:

-11.87%

Weekly VaR:

-26.54%

Monthly VaR:

-53.08%

How Much Can the price of

W

Decline in a Recession?

Likely price decline in a recession:

Base case (decline):

-46%

Worst case (decline):

>85%

This translates to price declining to:

$26.83

This translates to price declining to:

$7.45

Severe Crash Probability

Risk of crash in next 6/12 months: Medium (<50%)

What is Value at Risk (VaR)?

Risk Fundamentals

W is a 274.61% riskier investment compared to the market/S&P 500 & is 220.93% riskier than Nasdaq (IXIC)

Risk (measured by volatility) is 23.66% above industry average

Overall, it is amongst the top 50% most risky stocks

Beta Examination of

W

Beta in relation to market/S&P 500--2.88

Expected beta in 1 year's time:

1.276

Expected beta in 3 year's time:

1.805

Unlevered (debt free) Beta:

-2.652

Beta in relation to Nasdaq (XNAS):

1.848

Beta in relation to all global stocks::

1.426

Beta Comparison & Analysis

Beta of competitors/peers::

1.165

Beta is 146.91% higher than peers

Average Industry Beta:

2.105

Beta is 36.64% above industry average

Sustainable Growth Rate Analysis

Sustainable growth rate for this stock/firm:

Alpha provided | Alpha Analysis

Alpha provided:

-0.030

Alpha is -115.01% below industry average alpha yield

Alpha is -188% below the market average

Analysis of Cost of Capital of

W

Equity cost of capital:

0.228

Equity cost of capital is 30.07% above industry mean WACC

Unlevered (without debt) cost of capital:

-21.07%

Before-tax cost of debt:

0.84%

After-tax cost of debt:

0.67%

Overall debt rating:

Highest AAA investment grade

Weighted average cost of capital (WACC):

0.67%

WACC is -77.72% below industry mean WACC

Key Per-Share Metrics & Analysis

Revenue per share:

$124.35

Revenue growth rate per share of (3Y):

-2.77

Annual revenue growth rate is 67.79% above the industry average

EPS:

-$4.64

Expected Annual growth rate of EPS (3Y):

-50.95%

Expected future EPS growth rate is 1239.96% higher than the Internet Retail industry

Free cash flow (FCF) per share:

Debt per share

$37.00

EBITDA per share

-$0.98

Valuation Analysis Today of

W

P/E Ratio:

P/E Ratio of Competitors/Peers:

13.79

P/E ratio is -100.00% lower than main peers & is higher than the industry

W is -164.21% undervalued if valued using industry average P/E ratio

P/S (Price to Sales ratio):

0.4

Price to sales ratio is -80.49% below the industry mean

P/B (Price to book value ratio):

-2.77

Net income growth rate (3Y):

-75.74%

Net income growth rate is -211.40% lower than the industry average net income growth rate

Dividend Analysis

Dividend History:

--$0.00

In-depth Debt & Leverage Analysis

Debt to equity ratio:

-206.67%

Net debt to equity ratio:

-143.64%

Debt to assets ratio:

92.46%

Net debt to assets ratio:

64.26%

Debt-to-asset ratio is 40.97% above industry average

Ability to repay debt:

Interest coverage ratio:

-3.14

Interest coverage ratio is -130.13% less than industry average

Looking forward:

Debt growth rate:

47.07%

Annual debt growth is 60% higher than industry average debt growth rate

Debt repayment rate in last quarter: 0.00%

Analysis of Key Statistics

Correlation of price movement with the market:

0.511

Statistical significance of correlation:

W has a statistically significant correlation with the market

Average Correlation of the industry with the market:

0.441

Stock price is 15.88% more correlated with the market, compared to the industry average correlation

R Squared (percentage of price movement explained by movement of the market):

0.441

Correlation of price movement with Nasdaq (^IXIC):

-0.103

Covariance of price movement with the market:

-0.347

Kurtosis

9.709

Returns have a significant fat-tails (leptokurtic), i.e., returns considerably higher or lower than the mean returns are more probable, compared to assets with normally distributed returns

Skewness of returns:

0.876

Returns are right (positive) skewed; mean returns are greater than median and mode returns

Fundamental Analysis & Dupont Analysis of

W

Gross Profit Margin Ratio:

111%

Operating Profit Margin Ratio:

-3.25%

Operating profit margin is -140.84% lower than the industry

Net Profit Margin Ratio:

111%

Effective Tax Rate:

-0.86%

Effective tax rate is -109.52% lower than the industry

Dupont Method

Net Profit Margin

Return on Equity Ratio (ROE):

ROA

24.59%

Return on equity (ROE) is 24.86% higher than the industry

Financial Leverage

Asset Turnover Ratio (ROA):

-11.00%

Return on assets (ROA) is -473.30% lower than the industry

Financial Leverage:

13.3x

Current Ratio:

1.22

Current ratio is -38.81% below industry average

Cash Conversion Cycle (days):

-36.7

Cash conversion cycle is -156.25% below industry average

The remaining useful life of property plant & equipment is: 10.5 years

Stock based compensation to net income ratio:

-22.21%

In-depth Efficiency Analysis

Revenue generated per employee:

792.7K

Each employee generates 4% more revenue than industry average revenue per employee

EBITDA generated per employee:

- 6.3K

Each employee generates -103% less EBITDA than industry average revenue per employee

Profit generated per employee:

- 28.1K

Each employee generates -116% less net income/profit than industry average revenue per employee

Free cash flow (FCF) generated per employee:

- 15.9K

Each employee generates -1115% less free cash flow than industry average revenue per employee

Assets/Capital per employee

94.5K

Each employee generates -1115% less free cash flow than industry average revenue per employee

Research & Development (R&D) Analysis

Competitors/Peer firms of

W

INTERNATIONAL PAPER COMPANY (XNYS:IP)

NVR, Inc. (XNYS:NVR)

DARDEN RESTAURANTS, INC. (XNYS:DRI)

DOMINO'S PIZZA, INC. (XNYS:DPZ)

Restaurant Brands International Inc. (XNYS:QSR)

CARMAX, INC. (XNYS:KMX)

GENUINE PARTS COMPANY (XNYS:GPC)

CHEWY, INC. (XNYS:CHWY)

ROYAL CARIBBEAN CRUISES LTD. (XNYS:RCL)

Current Analyst Ratings

Strong buy�38%

Buy�21%

RISK CONCERN

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