Wendy's (WEN) valuation at a glance
Wendy's (WEN) trades below the fair value estimate shown here. At $6.26 versus a $8.00 estimate, that is a 28% upside.
- Price
- $6.26
- Fair value estimate
- $8.00
- Upside
- +28%
- Forward P/E
- 9.8×
- Market cap
- $1.19B
- P/S (TTM)
- 0.5×
CompaniesWEN
WEN
The Wendy's Company
Consumer CyclicalRestaurantsQSRFranchiseTake-Private CandidateDividendMeme Stock History
Overview
$6.26+1.5%
Market Cap
$1.19B
SEC filings
P/E (TTM)
8.1×
SEC filings
Rev Growth YoY
3.3%
+3.3%SEC filings
Gross Margin
34.1%
SEC filings
FCF Yield
11.0%
Calculated from SEC filings
Upside to FV
+27.8%
analyst consensus (20-25 analysts, StockAnalysis/Yah
Conviction
2/5Cheapest QSR franchise at 8× P/E with 11% FCF yield and 9% dividend, but $4.1B debt load, -7.8% US SSS, and Piotroski 4/9 make this a value trap unless Trian's take-private materializes. After-hours +20% on WSB momentum (Jun 23).
Research Depth
ScreeningDeep ResearchFull Model
Data as of 2026-06-24
Quality Snowflake
Overall 57/100
Value5/5
Future1/3
Past4/4
Health2/4
Dividend0/1
Each axis scores the checks for which data is available (filled = pass, hollow = no data). Computed from the sourced metrics on this page, not a third-party rating.
Thesis
REBASED 2 September 2026. Enterprise value here previously included both operating and finance lease liabilities, at $5,009M. Every other page on this site strikes it on borrowings plus finance leases and excludes operating leases, because EBITDA is measured after rent and counting the operating lease as debt charges twice for the same obligation. On that basis, with borrowings of $2,760.3M, finance leases of $673.4M and cash of $300.8M, enterprise value is $4,323.8M and the EBITDA multiple 9.06 rather than 10.5. Operating leases of $711.4M sit outside it. The debt to equity of 3,563% shown below still counts both lease types and is not restated here. ORIGINAL TEXT FOLLOWS. Wendy's trades at 8.1× trailing earnings, cheapest in the QSR universe, while generating $131M FCF and paying a 9% dividend yield. The market prices it for structural decline after U.S. same-store sales fell -7.8% in Q1 2026 and the dividend was cut 44% in mid-2025. Trian Fund Management (16% + personal stake, ~24% combined) is actively pursuing a take-private deal with Middle Eastern co-investors (FT, May 12, 2026), which provides a potential floor. The stock surged +20% after-hours on Jun 23 on WSB retail momentum. WEN was the original WSB food stock (Jun 2021: +26% in a day, fully reversed within weeks). But the $4.1B debt load (35× equity, EV 4.2× market cap) means any cash flow deterioration could trigger a debt spiral. The outcome is binary. Trian take-private at $10-12 = +60-90% upside, or continued SSS decline with no deal = dividend cut and sub-$5. Piotroski F-Score 4/9, five of nine quality metrics are failing.
Bull Case
ValuationCheapest P/E (8.1×) and P/S (0.54×) in the QSR peer group. FCF yield of 11% is top of its peer group. Peer median P/E is 24×.
Take-PrivateTrian Fund Management (Nelson Peltz, 16% stake) actively seeking Middle Eastern investors for a buyout funded with debt. Board seats give Trian operational control. Typical QSR take-private premiums are 30-50%.
Franchise Model~95% franchised system generates royalties regardless of company-store performance. Franchise fees + royalties provide a floor under cash flow even in downturns.
Dividend9% yield at current price. Even after the 44% cut, payout ratio is 73% of earnings, still covered by FCF ($131M FCF vs $107M annual dividend).
InternationalChina franchise agreement for 1,000+ restaurants over the next decade. International systemwide sales +6.0% in Q1 2026 while U.S. fell.
WSB / RetailAfter-hours +20.4% on WSB momentum (Jun 23). 37% short float with 3.69-day short ratio creates squeeze mechanics. S3 Partners squeeze score: 100/100. Borrow utilization: 92%. Effective tradeable float may be as low as 20-30M shares (94% inst + 9% insider locked). WEN is culturally embedded in WSB ('Sir, this is a Wendy's'). Historical precedent: Jun 2021 WSB rally drove WEN +26% in one day. Caution: that rally fully reversed.
Bear Case
Debt LoadDebt/equity ratio of 3,563%, $4.1B total debt against $117M stockholders' equity. Interest expense of $127M/year consumes 37% of EBIT. Any cash flow deterioration risks covenant breach.
SSS DeclineU.S. same-store sales fell -7.8% in Q1 2026, worst in the QSR peer group. Global systemwide sales -5.5%. That is not a cyclical dip. Traffic is structurally declining.
Quality ScorePiotroski F-Score of 4/9: ROA declining, gross margins compressing, debt increasing, current ratio worsening, asset turnover falling. Five of nine quality metrics failing.
Dividend RiskDividend was already cut 44% in mid-2025 (from $0.25 to $0.14/quarter). If SSS decline continues, another cut is likely. The 9% yield is a distress signal, not a gift.
Take-Private UncertaintyNo formal Trian bid has been submitted. Financing a take-private of a company with $4.1B existing debt during elevated interest rates is extremely challenging.
Key Metrics
Market Cap
$1.19B
SEC filings
Enterprise Value
$4.32B
Calculated from SEC filings
Revenue (TTM)
$2.19B
SEC filings
P/E (TTM)
8.1×
SEC filings
Forward P/E
9.8×
analyst consensus (20-25 analysts, StockAnalysis/Yah
P/S (TTM)
0.5×
SEC filings
P/B
10.1×
SEC filings
EV/EBITDA
9.0×
Calculated from SEC filings
PEG
1.1×
Calculated from SEC filings
Revenue Growth
3.3%
SEC filings
Gross Margin
34.1%
SEC filings
Operating Margin
14.8%
SEC filings
Net Margin
6.8%
SEC filings
Free Cash Flow
$131M
SEC filings
FCF Yield
11.0%
Calculated from SEC filings
Debt / Equity
28.4×
SEC filings
Current Ratio
1.8×
SEC filings
Short Interest
37.0%
SEC filings
Institutional Own.
94.4%
SEC filings
Insider Own.
9.1%
SEC filings
Shares Out.
190.0M
SEC filings
Float
157.0M
SEC filings
Valuation
Price vs Fair Value
Bear$4.50
Base$8.00
Bull$12.00
Now $6.26
Bear Case
$4.50
Continued SSS decline (-5% annually), another dividend cut, no takeout. 6× depressed earnings.
Base Case
$8.00
Analyst median target. SSS stabilization + franchise royalty floor. 10× normalized EPS.
Bull Case
$12.00
Trian take-private at 30-50% premium, or SSS recovery to positive. 15× earnings.
DCF Summary
Discount Rate
12%
Terminal Growth
1.5%
Projection
5y
Rev CAGR
2%
Intrinsic / Share
$7.80
Margin of Safety
21.8%
Historical Multiples
| Year | P/E | P/S | EV/EBITDA |
|---|---|---|---|
| FY22 | 11.3× | 0.6× | 10.0× |
| FY23 | 9.8× | 0.5× | 9.1× |
| FY24 | 8.6× | 0.5× | 9.0× |
| FY25 | 7.2× | 0.6× | 9.6× |
| TTM · | 8.1× | 0.5× | 10.5× |
Current multiple highlighted vs trailing history.
Peer Comparison
| Ticker | Mkt Cap | P/E | P/S | EV/EBITDA | Rev Growth | Gross Mgn | Net Mgn |
|---|---|---|---|---|---|---|---|
| WEN | $1.2B | 8.1× | 0.5× | 9.0× | +3.3% | 34.1% | 6.8% |
| QSR | $32.7B | 23.0× | 3.4× | 14.3× | +7.3% | 33.9% | 10.0% |
| MCD | $193B | 22.4× | 7.0× | 16.6× | +9.4% | 57.3% | 32.6% |
| YUM | $41.8B | 24.5× | 4.9× | 18.1× | +15.2% | 45.7% | 20.5% |
| DPZ | $9.4B | 16.3× | 1.9× | 14.0× | +3.5% | 28.7% | 11.9% |
| JACK | $221M | – | 0.1× | 12.2× | -4.3% | 27.0% | 2.5% |
| DIN | $422M | 28.9× | 0.5× | 10.6× | +4.8% | 40.1% | 1.8% |
Financials
| Line Item | FY2024 | FY2025 | YoY | Q1 2026 |
|---|---|---|---|---|
| Total Revenue | $2,246M | $2,177M | -3.1% | $541M |
| Cost of Revenue | $1,617M | $1,588M | -1.8% | $402M |
| Gross Profit | $629M | $589M | -6.4% | $138M |
| SG&A | $95M | $85M | -9.7% | $32M |
| D&A | $158M | $171M | +8.2% | $45M |
| Operating Income | $388M | $354M | -8.8% | $64M |
| Interest Expense | $124M | $126M | +2.1% | $34M |
| Pretax Income | $272M | $227M | -16.6% | $34M |
| Tax Provision | $78M | $62M | -20.5% | $11M |
| Net Income | $194M | $165M | -15.1% | $23M |
| Diluted EPS | $0.95 | $0.85 | -10.5% | $0.12 |
| Item | FY2025 | Notes |
|---|---|---|
| Cash & Equivalents | $301M | Includes restricted cash $137M |
| Current Assets | $618M | Receivables $117M, inventory $7M |
| Goodwill | $774M | From Tim Hortons/Arby's era acquisitions |
| Intangible Assets | $1,171M | Franchise rights, trademarks |
| Total Assets | $4,957M | n/a |
| Current Liabilities | $351M | AP $31M, accrued $59M |
| Long-Term Debt | $2,731M | Securitized notes |
| Capital Lease Obligations | $1,385M | Operating leases |
| Total Debt | $4,145M | 3,563% D/E ratio |
| Stockholders' Equity | $117M | Negative tangible book ($-1.83B) |
| Total Liabilities + Equity | $4,957M | n/a |
| Component | FY2024 | FY2025 |
|---|---|---|
| Operating Cash Flow | $355M | $345M |
| Capital Expenditure | ($94M) | ($102M) |
| Free Cash Flow | $261M | $243M |
| Dividends Paid | ($204M) | ($130M) |
| Share Buybacks | ($77M) | ($201M) |
| Debt Repayment | ($50M) | ($479M) |
| Debt Issuance | $0 | $476M |
| Net Change in Cash | ($77M) | ($150M) |
Source: SEC 10-K (FY2025, filed Feb 2026) + 10-Q (Q1 2026, filed May 2026). All figures in USD.
Catalysts
Jun 23-24
Markethigh relevance
WSB retail rally, after-hours +20.4% to $7.53
S3 squeeze score 100/100. 37% short float (50.3M shares, +8.6% MoM). Borrow utilization 92%. Effective float ~20-30M (94% inst-locked). After-hours +20.4% ($6.26→$7.53). Put/Call OI 1.38 (inst hedging) vs P/C volume 0.38 (retail call buying). Base rate of WSB squeeze success: ~5-10%. Borrow rate only 5.88%, shorts comfortable. 2021 WEN rally reversed fully.
Jun 23
Regulatory
New CFO Steve Cirulis appointed
Wendy's named Steve Cirulis as Chief Financial Officer and Chief Strategy Officer effective Jun 23. Source: Wendy's IR press release.
H2 2026
M&Ahigh relevance
Trian Fund take-private bid
Nelson Peltz (16% + personal stake, combined ~24%) actively seeking Middle Eastern co-investors. First reported by FT on May 12, 2026. No formal bid. Key risk: financing $4.1B existing debt at current rates.
Aug 7
Earningshigh relevance
Q2 2026 earnings (confirmed date)
U.S. SSS trend is the swing factor. Q1 was -7.8%. Any improvement toward -3% would trigger re-rating. New CFO's first earnings call, watch for strategic pivots.
Q4 '26
Product
China franchise rollout begins
Largest-ever franchise agreement for 1,000+ restaurants. 'Project Fresh' turnaround initiative.
Risks
| Risk | Category | Severity | Probability | Impact on Thesis |
|---|---|---|---|---|
| Extreme gearing, $4.1B debt on $1.2B market cap, 3,563% D/E | Capital Structure | Critical | High | Interest expense consumes 37% of EBIT. Any cash flow deterioration could trigger covenant breach or force equity dilution. |
| Accelerating U.S. SSS decline (-7.8% Q1 2026) | Execution | High | High | Traffic declining structurally. Consumer trade-down to value competitors. Menu innovation has not reversed trend. |
| Dividend already cut 44%, further cuts likely if SSS doesn't stabilize | Dividend | High | Medium | Income investors exit, removing a key buyer base. Would accelerate price decline. |
| Take-private financing risk in high-rate environment | M&A | Medium | Medium | Trian may not secure financing. Failed take-private attempts typically cause 15-25% drops. |
| Commodity cost inflation (USDA revised fertilizer +13%) | Market/Macro | Medium | High | Wendy's fresh-beef-focused menu has higher commodity exposure than frozen-patty competitors. |
Technical Snapshot
52-Week Range
$6.07$6.26$12.33
RSI (14)
28
oversold
50-Day MA
$7.11
-12.0%below
200-Day MA
$8.00
-21.8%below
Avg Vol (30d)
9.9M
-24%vs average
Support Levels
$6.07$5.50$5.00
Resistance Levels
$7.11$8.00$8.50
Technical inputs: SEC filings. See the record-specific source notes for measurement basis.
Ownership & Insider Activity
Institutional Holders
| Institution | Shares | % Held | Chg QoQ | Reported |
|---|---|---|---|---|
| Trian Fund Management | 30.4M | 16.0% | – | |
| BlackRock | 21.7M | 11.4% | – | |
| Vanguard | 16.1M | 8.4% | – | |
| Morgan Stanley | 7.6M | 4.0% | – | |
| Wells Fargo | 6.9M | 3.6% | – | |
| Schwab | 6.5M | 3.4% | – | |
| Harris Associates | 5.9M | 3.1% | – | |
| State Street | 5.5M | 2.9% | – |
Insider Activity
No open-market insider buying detected. All recent transactions are routine stock awards/grants to directors. Nelson Peltz (Trian) holds 16% via fund, not personal Form 4. Harris Associates reduced position by 40.5%, notable large-holder exit.
| Name | Title | Action | Shares | Price | Date | Value |
|---|---|---|---|---|---|---|
| Directors (7) | Board | Grant | ~147K | $0 (stock awards) | May 2026 | ~$1.0M |
| Directors (4) | Board | Grant | ~10K | $7.14 | Apr 2026 | ~$70K |
Peer Comparison
| Ticker | Mkt Cap | P/E | P/S | EV/EBITDA | Rev Growth | Gross Mgn | Net Mgn |
|---|---|---|---|---|---|---|---|
| WEN | $1.2B | 8.1× | 0.5× | 9.0× | +3.3% | 34.1% | 6.8% |
| QSR | $32.7B | 23.0× | 3.4× | 14.3× | +7.3% | 33.9% | 10.0% |
| MCD | $193B | 22.4× | 7.0× | 16.6× | +9.4% | 57.3% | 32.6% |
| YUM | $41.8B | 24.5× | 4.9× | 18.1× | +15.2% | 45.7% | 20.5% |
| DPZ | $9.4B | 16.3× | 1.9× | 14.0× | +3.5% | 28.7% | 11.9% |
| JACK | $221M | – | 0.1× | 12.2× | -4.3% | 27.0% | 2.5% |
| DIN | $422M | 28.9× | 0.5× | 10.6× | +4.8% | 40.1% | 1.8% |
Recognizable sector comparables. Source basis: SEC filings; lowest multiple in each column highlighted. Loss-making peers show no P/E.
Research Notes
2026-09-02Recomputed from the balance sheet at 30 June 2026
A debt to equity of 3563 was a percentage that never got divided
This page published a debt to equity ratio of 3563. No company has that. It is a percentage taken from a data feed and written into a field that holds a ratio, so it was a hundred times too large before anything else was considered. Corrected on this site's convention the figure is still the most important number on the page. Total reported debt is $4,072.5M, of which $1,323.5M is lease liabilities. Operating leases of $648.4M are excluded because EBITDA is struck after rent, and finance leases of $675.2M are included because EBITDA adds back both the right-of-use amortisation and the interest on them. That leaves $3,424.2M against shareholders equity of $120.5M, which is 28.4 times. The equity is a sliver at the bottom of the capital structure, and that, rather than an eight times earnings multiple, is what a buyer of this stock is taking on.
2026-09-02Recomputed from SEC XBRL company facts for CIK 0000030697
The operating margin paired one quarter with a different quarter's revenue
This page previously showed an operating margin of 11.4%. That figure does not correspond to any period the company reports. It is the operating income of the quarter ended 29 March 2026, $64,921,000, divided by the revenue of a different quarter, the $570,600,000 reported for the quarter ended 28 June 2026. On the trailing twelve months that the revenue figure on this page actually covers the margin is higher. Fiscal 2025 operating income was $343,452,000, the March 2025 quarter was $83,126,000 and the March 2026 quarter was $64,921,000, giving trailing operating income of $325,247,000 on revenue of $2,194,056,000, or 14.8%. The direction of the business is unchanged, since operating income fell year over year in the most recent quarter, but the level shown was understated by 3.4 points. Net margin of 6.8% was struck on the correct window and is unchanged.
2026-06-24Internal
VALIDATION SPRINT 2: 62 metrics verified, 8 corrections applied
Sprint 2 deep validation against 4 sources (yfinance, StockAnalysis, Finviz, Yahoo Finance). 54/62 exact matches (87%). Corrections: currentRatio 1.76→1.83, shortInterest 30%→37% (yfinance primary), ma50 7.01→7.11, ma200 7.71→8.00, short ratio 5.15→3.69 days. S3 Partners squeeze score 100/100. Borrow utilization 92%. Altman Z-Score 1.01 (distress boundary). Piotroski confirmed 4/9. Total debt $4.12B on $1.19B mcap = the equity is a geared call option.
2026-06-24Reddit / WSB + Yahoo Finance + S3 Partners
WSB rally confirmed, squeeze mechanics validated
After-hours +20.4% to $7.53 on WSB momentum. S3 Partners rates WEN squeeze score 100/100 with 92% borrow utilization. Short interest 37% of float (50.3M shares, +8.6% MoM, shorts are piling in). Days to cover: 3.69-5.1 (depends on volume window). Effective tradeable float may be 20-30M shares (94% inst + 9% insider locked). Put/Call OI ratio 1.38 (put-heavy institutional hedging) vs P/C volume ratio 0.38 (call-heavy retail buying). HOWEVER: base rate of 'next GME' picks succeeding is ~5-10%. No coordinated retail army. Borrow rate only 5.88% (not painful for shorts). Options liquidity poor. A take-private event play with squeeze convexity, NOT a pure meme squeeze.
2026-06-23Wendy's IR
New CFO Steve Cirulis appointed
Wendy's named Steve Cirulis as Chief Financial Officer and Chief Strategy Officer, effective June 23, 2026. His first earnings call will be Q2 2026 (Aug 7). Source: official Wendy's IR press release.
2026-06-22yfinance + market data
June 22 crash: -9.3% on 18.5M volume (2.4× avg)
WEN dropped from $6.80 to $6.17 on June 22, the largest single-day decline in months, on 18.5M shares (2.4× the 30-day average of 7.7M). Touched 52-week low of $6.07 intraday. Catalyst: USDA farm production cost forecast showing fertilizer estimates revised up 13%. Wendy's fresh-beef menu has higher commodity exposure than frozen-patty competitors (MCD, BK).
2026-05-12FT / Market reports
Trian take-private pursuit, FT original source
Financial Times reported (May 12, 2026) that Nelson Peltz's Trian Fund Management is seeking Middle Eastern co-investors to finance a potential take-private deal for Wendy's. Trian holds 16.24% via fund + Peltz personal stake totaling ~24% combined. No formal bid submitted. Stock bounced +10.6% in May on the news but has since given back all gains. Multiple outlets confirmed: Hedgeweek, Quartz, US News.
2026-05SEC 10-Q + earnings call
Q1 2026: Revenue $541M, EPS $0.12, SSS -7.8%
Revenue $540.6M (beat $520.48M estimate, +3.3% YoY). EPS $0.12 (beat $0.10 estimate). U.S. same-store sales declined -7.8%, significantly worse than -2.8% prior year. Adjusted EBITDA $111.3M. International SSS +6.0%. FY2026 EPS guidance reaffirmed: $0.56-$0.60. China franchise agreement for 1,000+ restaurants announced ('Project Fresh').
2026-06-24yfinance + Finviz
Cross-source data discrepancies documented
Margin definitions differ: StockAnalysis reports franchise-model margins (GM 63%, OpM 22%, NM 15%) reflecting franchisor economics; yfinance/Finviz/Yahoo report consolidated GAAP margins (GM 34%, OpM 11%, NM 6.8%) including company-operated store COGS. Both are correct, different calculation bases. Investors should use GAAP figures. Forward P/E varies by source (9.8-11.0) due to different EPS estimate pools. Net income: $148.6M is GAAP; $325.6M on StockAnalysis likely includes different line items. All figures on this page use GAAP.
2025-06SEC 10-K
Dividend cut 44%: $0.25 to $0.14/quarter
Wendy's reduced quarterly dividend from $0.25 to $0.14 per share in mid-2025, a 44% reduction. Current annual run-rate is ~$107M vs prior ~$200M. At $6.26, yield is 8.95% (Finviz/Yahoo confirmed). Payout ratio: 73% of GAAP earnings, but well-covered by $131M FCF.
Sources
Wendy's valuation questions
Is Wendy's (WEN) stock undervalued?
Against the fair value estimate shown on this page, Wendy's trades below: $6.26 today versus a $8.00 estimate, about +28%. The methodology and per-scenario sources are set out in the Valuation section. Treat it as research, not advice, and do your own homework.
What is Wendy's's fair value?
The fair value estimate shown for WEN is $8.00. Its valuation scenarios span bear $4.50, base $8.00, bull $12.00. See the Valuation section for the basis of each.
What is Wendy's's forward P/E ratio?
Wendy's (WEN) trades at a forward P/E of 9.8×, and 0.5× trailing sales.
What is Wendy's's market cap?
Wendy's (WEN) has a market capitalization (its market value, often searched as "net worth") of $1.19B, and an enterprise value of $4.32B.
What is the bull and bear case for WEN?
Valuation scenarios: bull $12.00, base $8.00, bear $4.50. Each reflects a distinct set of assumptions; the drivers and sources are detailed in the Valuation section above.