WILLIAMS COMPANIES, INC. (WMB) Stock Analysis
WILLIAMS COMPANIES, INC. (WMB) Stock Analysis
Analysis from 10-Q filed 2025-11-03. Data as of Q4 2025.
Overall Grade: F (Concerning)
WILLIAMS COMPANIES, INC. faces challenges in financial performance that warrant careful analysis.
| Metric | Value | Context |
|---|---|---|
| ROIC | 8.4% | Near cost of capital |
| FCF Margin | 8.4% | Healthy cash flow |
| Debt/Equity | 2.2x | Elevated debt |
Investment Thesis: Financial metrics indicate concerning business quality with areas requiring attention.
Explore WILLIAMS COMPANIES, INC.: Earnings History | Filing Intelligence | ROIC Analysis
Profitability: WILLIAMS COMPANIES, INC. earns 8.4% ROIC, Top 50% in Utilities
WILLIAMS COMPANIES, INC.'s trailing-twelve-month ROIC of 8.4% ranks Top 50% in Utilities companies (sector median: 5.8%), driven by NOPAT margin of 26.8% combined with asset turnover of 0.2x. Source: 10-Q filed 2025-11-03.
| Metric | WMB | Rating | Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 8.4% | Adequate | Above sector median of 5.8% |
| Return on Equity (ROE) | 20.9% | Excellent | Efficient use of shareholder equity |
| Operating Margin | 35.1% | Excellent | Efficient operations |
Cash Flow: WILLIAMS COMPANIES, INC. generates $1.0B FCF at 8.4% margin, positive NaN/8 quarters
WILLIAMS COMPANIES, INC. generated $1.0B in free cash flow (TTM), a 8.4% FCF margin, a margin that ranks Top 50% in Utilities. Operating cash flow exceeds net income by 2.3x, indicating high earnings quality. FCF was positive in N/A of the last 8 quarters. Source: 10-Q filed 2025-11-03.
| Metric | WMB | Rating | Context |
|---|---|---|---|
| Free Cash Flow Margin | 8.4% | Adequate | Healthy cash generation |
| Free Cash Flow (TTM) | $1.0B | Good | Positive cash generation |
| OCF/Net Income | 2.3x | Excellent | High earnings quality |
| FCF Consistency (8Q) | N/A | Warning | Variable cash flow |
Balance Sheet: WILLIAMS COMPANIES, INC. at 2.2x leverage
WILLIAMS COMPANIES, INC.'s debt-to-equity ratio of 2.2x reflects high leverage. Total debt of $28.0B offset by $63.0M in cash. Source: 10-Q filed 2025-11-03.
| Metric | WMB | Rating | Context |
|---|---|---|---|
| Debt to Equity | 2.2x | Warning | Elevated leverage |
| Net Cash Position | $-28.0B | Warning | Net debt position |
Valuation: WILLIAMS COMPANIES, INC. trades at 28.0x earnings
WILLIAMS COMPANIES, INC. trades at a P/E of 28.0x. Free cash flow yield of 1.4% reflects market expectations for growth.
| Metric | WMB | Rating | Context |
|---|---|---|---|
| P/E Ratio | 28.0x | Adequate | Premium valuation |
| EV/Sales | 8.3x | Adequate | Growth premium priced in |
| FCF Yield | 1.4% | Warning | Lower cash yield |
| Dividend Yield | 3.3% | Adequate | Meaningful income |
Capital Allocation: WILLIAMS COMPANIES, INC. returns 3.3% shareholder yield
WILLIAMS COMPANIES, INC.'s total shareholder yield is 3.3% (dividends 3.3% + buybacks). Source: 10-Q filed 2025-11-03.
| Metric | WMB | Rating | Context |
|---|---|---|---|
| Total Shareholder Yield | 3.3% | Good | Dividend + buyback yield combined |
| Total Capital Returned (TTM) | $2.4B | Good | Dividends + buybacks returned to shareholders |
Sector Rankings
| Metric | Value | Percentile | vs Median |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 8.4% | Top 50% | 1.5x above |
| Free Cash Flow Margin | 8.4% | Top 50% | - |
| Operating Margin | 35.1% | Top 25% | 1.7x above |
| Return on Equity (ROE) | 20.9% | Top 5% | 2.2x above |
| P/E Ratio | 28.0x | N/A | - |
Financial Scorecard
| Metric | WMB | Rating | Sector Context |
|---|---|---|---|
| Return on Invested Capital (ROIC) | 8.4% | Adequate | Top 50% of sector (median: 5.8%) |
| Free Cash Flow Margin | 8.4% | Adequate | Top 50% of sector (median: 0.0%) |
| Debt to Equity Ratio | 218.8% | Warning | High financial leverage |
| P/E Ratio (Price-to-Earnings) | 28.0x | Adequate | Growth premium |
| Free Cash Flow Yield | 1.4% | Warning | Growth-focused valuation |
Frequently Asked Questions
Q: What is WILLIAMS COMPANIES, INC.'s Return on Invested Capital (ROIC)?
WILLIAMS COMPANIES, INC. (WMB) has a trailing twelve-month Return on Invested Capital (ROIC) of 8.4%. This compares above the sector median of 5.8%. An ROIC near 8-12% is approximately the cost of capital for most companies.
Q: What is WILLIAMS COMPANIES, INC.'s Free Cash Flow Margin?
WILLIAMS COMPANIES, INC. (WMB) has a free cash flow margin of 8.4%, generating $1.0 billion in free cash flow over the trailing twelve months. A FCF margin between 5-10% is typical for capital-intensive businesses.
Q: Is WILLIAMS COMPANIES, INC. stock overvalued or undervalued?
WILLIAMS COMPANIES, INC. (WMB) trades at a P/E ratio of 28.0x, which is above the sector median of N/A. The EV/Sales multiple is 8.3x. Free cash flow yield is 1.4%, reflecting growth expectations priced into the stock.
Q: Does WILLIAMS COMPANIES, INC. pay a dividend?
WILLIAMS COMPANIES, INC. (WMB) currently pays a dividend yield of 3.3%. Including share buybacks, the total shareholder yield is 3.3%. This yield is moderate, suggesting a balance between income and growth reinvestment.
Q: How much debt does WILLIAMS COMPANIES, INC. have?
WILLIAMS COMPANIES, INC. (WMB) has a debt-to-equity ratio of 2.2x with total debt of $28.0 billion. Net debt position is $28.0 billion.
Q: What is WILLIAMS COMPANIES, INC.'s revenue and earnings growth?
WILLIAMS COMPANIES, INC. (WMB) grew revenue by 13.8% year-over-year. Earnings per share increased by 16.9% compared to the prior year. Solid growth above 10% suggests healthy business momentum.
Q: How does WILLIAMS COMPANIES, INC. compare to competitors in Utilities?
Compared to other companies in Utilities, WILLIAMS COMPANIES, INC. (WMB) shows: ROIC of 8.4% is above the sector median of 5.8% (Top 26%). FCF margin of 8.4% exceeds the sector median of 0.0% (Top 32% of sector). These rankings are based on MetricDuck's analysis of all Utilities companies with available SEC filings.
Q: What warning signs should I watch for with WILLIAMS COMPANIES, INC.?
Investors in WILLIAMS COMPANIES, INC. (WMB) should monitor these potential warning signs: 1) Debt-to-equity of 2.2x is elevated. Regular monitoring of SEC filings and quarterly trends is recommended.
Data Source: Data sourced from 10-Q filed 2025-11-03. TTM metrics as of Q4 2025.
Methodology: Financial metrics calculated from SEC 10-K and 10-Q filings using standardized formulas. Sector comparisons use peer group based on SIC code.
Scope: This analysis covers SEC filing fundamentals — profitability, cash flow, balance sheet, and valuation metrics. For analyst estimates and price targets, consult sell-side research.
This analysis is for informational purposes only and does not constitute investment advice.