WINA  Winmark Corporation

Exchange

NASDAQ

Sector

Consumer Services

Industry

Other Specialty Stores

Market Cap.

494.34M

Vuru Grade

36.00/100

Current Price

$129.37
-1.7758 (-1.3540%)

Company Metrics

  • P/E 24.6992
  • P/S 7.2305
  • P/B 121.79
  • EPS 5.238
  • Cash ROIC -75.78%
  • Cash Ratio 2.51
  • Dividend 0.44 / 0.33%
  • Avg. Vol. 6,525.00
  • Shares 4.33M
  • Market Cap. 494.34M

Company Description

Winmark Corporation franchises retail store concepts that buy, sell, trade, and consign merchandise in the United States and Canada. As of December 26, 2009, the company had 914 franchises operating under the brands of Play It Again Sports, Plato's Closet, Once Upon a Child, Music Go Round, and Wirth Business Credit. The Play It Again Sports franchises buy, sell, trade, and consign used and new sp... more


Download 10 Years of Financial Statements:
Income Statement   Balance Sheet   Cash Flow

News

Winmark Corporation Announces Third Quarter Results
Business Wire (press release) - Oct 17, 2017
MINNEAPOLIS--(BUSINESS WIRE)--Winmark Corporation (Nasdaq: WINA) announced today net income for the quarter ended September 30, 2017 of $5,719,000 (or $1.33 per share diluted) compared to net income of $6,094,200 (or $1.41 per share diluted) ...
Winmark Corporation (NASDAQ:WINA) Sees Light Trading Volume with 899 Shares ... - First News 24
Winmark Corp: Franchisor Misclassified As A Retailer, Trading At A Substantial ...
Seeking Alpha - Aug 23, 2016
Winmark Corp (NASDAQ:WINA) is a franchisor of five retail store concepts, including (1) Plato's Closet (2) Once Upon A Child (3) Play It Again Sports (4) Music Go Round and (5) Style Encore, which hold a collective footprint of 1,150 stores across the ...
Steven Murphy Sells 2765 Shares of Winmark Corporation (WINA) Stock
Dispatch Tribunal - 4 hours ago
Winmark Corporation logo Winmark Corporation (NASDAQ:WINA) insider Steven Murphy sold 2,765 shares of the firm's stock in a transaction that occurred on Thursday, October 19th.
Winmark Corporation (WINA) Shares Bought by Renaissance Technologies LLC - The Ledger Gazette
Winmark Corporation (NASDAQ:WINA) Experiences Light Trading Volume - Highlight Press
Winmark Corporation: A High Margin, Owner-Operator Small Cap That Is Breaking Out
Seeking Alpha - Jul 19, 2013
On July 16th 2013, Winmark announced second quarter earnings of .85 cents per share, which represents a 28% increase over the same quarter last year.
130.95
MarketWatch - Jun 6, 2009
Winmark Corp. Winmark Corp. engages in creating, supporting, and financing business. It operates through the Franchising and Leasing segments.
Winmark Corporation (WINA) Moves Lower on Volume Spike for October 20
Equities.com - Oct 20, 2017
Winmark Corporation (WINA) traded on unusually high volume on Oct. 20, as the stock lost 2.02% to close at $131.15. On the day, Winmark Corporation saw 10,584 shares trade hands on 178 trades. Considering that the stock averages only a daily volume of ...
Winmark Corporation (NASDAQ:WINA) Short interest fell by -7.54% – Shares ... - Modern Readers
Winmark Corporation (NASDAQ:WINA) Short Interest Down by -7.54% – Currently ... - First News 24
A Massive Tender Offer Has Created A Solid Buying Opportunity In Winmark Corp ...
Seeking Alpha - Apr 16, 2015
This article will be tightly focused on the opportunity that I currently believe exists in Winmark Corp. (NASDAQ:WINA) shares.
Winmark Corporation Commences Self-Tender Offer to Purchase up to 400000 Shares
Business Wire (press release) - Jul 19, 2017
MINNEAPOLIS--(BUSINESS WIRE)--Winmark Corporation (Nasdaq: WINA) announced today the commencement of a self-tender offer to purchase up to 400,000 shares, or approximately 9.5% of its outstanding common stock, for a price of $124.48 per share.
Winmark Corporation Announces Management Addition
Business Wire (press release) - Jan 18, 2017
MINNEAPOLIS--(BUSINESS WIRE)--Winmark Corporation today announced that Alan Majerko has been named Vice President, Corporate Development.
Winmark Corporation Announces Management and Governance Changes
Business Wire (press release) - Feb 24, 2016
MINNEAPOLIS--(BUSINESS WIRE)--Winmark Corporation today announced that Brett D. Heffes, President of Winmark, will succeed John L. Morgan as Winmark's Chief Executive Officer.
Growth Rate Assumed by Market

We did a reverse valuation to calculate the growth rate the market is assuming for WINA to be considered fairly valued at its current market price. It's useful to compare this to the growth rate we're assuming for the Growth Price.

Future Free Cash Flow Growth Rate

This is the annual growth rate we've applied to calculate WINA's Free Cash Flow for the next 10 years. To calculate it, we looked at several time periods of the last 10 years. Feel free to adjust it, but we limit the initial growth rate to 20% and slow it down over the years. Otherwise, long-term sustainability issues come into play.

Discount Rate

The discount rate is the annual rate of return an investor requires to take the risk of investing in a single stock. To account for that risk, this should be above 8-10%, as this is the avg. annual rate of return for the S&P500 over the past 100 years.

$129.37 Current Price

$-2.73 Growth Price (DCF)

Why is this negative?


Show Free Cash Flow numbers

$-10.65 Book Price

Overvalued by 108.23%


Very Poor Cash Return on Invested Capital over the past 5 years

WINA has failed to generate positive returns on its investments in buildings, projects and equipment. This could be due to poor management, lack of an economic moat or the capital intensive nature of the business.

WINA has lost $75.78 of cash for every $100 invested.
Figures in USD. Fiscal year ends in December
20122013201420152016
Free Cash Flow -5.81M 525,400.00 -10.02M -27,200.00 -617,400.00
divided by
Invested Capital 7.25M 13.91M 3.34M 20.92M 22.77M
Cash ROIC -80.18% 3.78% -299.68% -0.13% -2.71%

Varying Return on Equity over the past 5 years

WINA has generated strong profits with money shareholders have invested. However, there is a substantial variation in their Return on Equity from year-to-year. This may reflect management's inability to generate consistent returns or may be caused by one-time events. Look at reasons for this inconsistency to determine the likelihood of future sustainability.

WINA has generated $42.56 of Earnings for every $100 of Shareholders' Equity.
Figures in USD. Fiscal year ends in December
20122013201420152016
Net Income 12.94M 18.23M 20.07M 21.80M 22.22M
divided by
Stockholders' Equity 17.93M 38.14M 21.61M -30.67M -7.85M
Return on Equity 72.17% 47.80% 92.86% - -

Poor Business Performance over the past 10 years

WINA's inability to produce positive free cash flow for the majority of the past 10 years is concerning. It should be a red flag, since this company does not have a track record of delivering results for shareholders. This could be due to poor management or the nature of its business.

WINA has been losing money for the majority of the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Free Cash Flow -27.71M -13.11M -2.57M -3.30M 41,400.00 -5.81M 525,400.00 -10.02M -27,200.00 -617,400.00

Very Weak Balance Sheet

WINA is in a poor financial position. This could be due to a slowdown in sales, indulging in debt-fuelled growth, or the nature of WINA's business. If it is highly capital intensive (see Economic Moat), they likely have to outlay significant capital just to stay competitive. This habit often destroys more value than it creates.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Cash 11.81M 20.46M 30.34M 16.27M 21.81M 15.78M 28.62M 22.39M 18.98M 18.46M
Current Assets 15.74M 24.69M 32.61M 18.88M 23.67M 18.93M 30.68M 28.44M 24.43M 22.79M
Total Assets 56.95M 58.11M 56.80M 42.12M 47.75M 43.54M 53.04M 54.73M 47.41M 48.58M
Current Liabilities 17.55M 18.53M 20.06M 15.28M 7.78M 20.51M 10.51M 29.00M 7.51M 7.36M
Total Liabilities 44.28M 44.22M 41.48M 19.11M 12.64M 25.61M 14.89M 33.12M 78.08M 56.43M
Stockholder' Equity 12.67M 13.89M 15.33M 23.01M 35.11M 17.93M 38.14M 21.61M -30.67M -7.85M
Current Ratio 0.90 1.33 1.63 1.24 3.04 0.92 2.92 0.98 3.25 3.10
TL-to-TA 0.78 0.76 0.73 0.45 0.26 0.59 0.28 0.61 1.65 1.16

Low or No Reinvestment of Profits over the past 10 years

WINA has either been retaining a small amount of their earnings or has done so inconsistently. A lack of consistency could be due to WINA operating at a loss or them having such a strong economic moat they feel comfortable spending profits on growth. Be wary of future prospects and if applicable, inspect the moat's sustainability.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Retained Earnings 12.36M 13.50M 15.32M 22.50M 34.46M 17.93M 35.20M 21.22M -31.05M -10.82M
Retained Earnings Growth - 9.22% 13.46% 46.87% 53.17% -47.97% 96.29% -39.70% -246.28% 65.16%

Competitive Advantage over the past 10 years

WINA likely has a competitive advantage which prevents other companies from entering or competing in their industry. This could be strong branding, the ability to keep costs low, or some other characteristic that is hard to replicate. Look at future prospects to determine its sustainability.

$23.64 of every $100 of Revenue have been pure profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Net Income 3.04M 1.14M 5.85M 10.33M 14.10M 12.94M 18.23M 20.07M 21.80M 22.22M
divided by
Revenue 31.17M 35.42M 37.30M 41.20M 51.34M 51.94M 55.73M 61.18M 69.45M 66.58M
Net Profit Margin 9.77% 3.22% 15.68% 25.07% 27.46% 24.91% 32.71% 32.80% 31.39% 33.37%

Strong Pricing Power over the past 10 years

WINA has maintained substantial gross margins, suggesting that they have been able to set prices without consideration of the cost of goods sold. This potentially leaves flexibility in inflationary environments to raise prices on consumers and maintain profitability.

$93.37 of every $100 worth of sales have been Gross Profit, on average over the past 10 years.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Gross Profit 26.30M 32.30M 32.72M 37.35M 51.34M 49.32M 53.53M 58.56M 66.79M 64.48M
divided by
Revenue 31.17M 35.42M 37.30M 41.20M 51.34M 51.94M 55.73M 61.18M 69.45M 66.58M
Gross Margin 84.38% 91.19% 87.72% 90.64% 100.00% 94.95% 96.04% 95.72% 96.18% 96.84%

High Capital Intensity over the past 10 years

WINA spends large amounts of capital buying new equipment or investing in new facilities to stay competitive. Over the long term, those costs may have to be fuelled by debt. Look at the growth of Shareholders' Equity to see if this strategy is having a positive or negative impact.

429.13% of Profits are being spent on Capital Expenditures, like Property, Plant, & Equipment, required to run the business.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Capital Expenditure 33.96M 22.09M 16.25M 15.70M 20.55M 23.98M 21.12M 28.00M 22.33M 26.28M
divided by
Net Income 3.04M 1.14M 5.85M 10.33M 14.10M 12.94M 18.23M 20.07M 21.80M 22.22M
Capital Expenditure Ratio 1,115.43% 1,938.79% 277.78% 152.03% 145.77% 185.36% 115.86% 139.54% 102.42% 118.28%

No Dividend History over the past 10 years

WINA has never distributed dividends or has recently suspended their dividend distribution.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Dividend Paid - - - - - - - - - -
divided by
Shares Outstanding 5.59M 5.53M 5.34M 5.21M 5.24M 5.24M 5.24M 5.22M 4.65M 4.33M
Dividend Paid Per Share - - - - - - - - - -
Price at Year End 19.46 10.75 20.20 30.70 53.32 57.55 93.55 87.54 92.85 126.15
Dividend Yield - - - - - - - - - -

Strong History of Stock Buybacks over the past 10 years

WINA has a strong history of delivering increased value for shareholders in the form of stock buybacks. These have helped improve financial metrics and increase each shareholders' relative ownership stake in the company, due to fewer shares outstanding and holding the same number of shares.
Figures in USD. Fiscal year ends in December
2007200820092010201120122013201420152016
Shares Outstanding 5.59M 5.53M 5.34M 5.21M 5.24M 5.24M 5.24M 5.22M 4.65M 4.33M
Stock Bought Back - 1.08% 3.63% 2.44% -0.53% 0.01% -0.07% 0.46% 12.15% 7.41%
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