Would You Still Hold Wendy’s Stock If It Fell Another 30%?
Wendy’s (WEN) stock is down 5.3% in 21 trading days. The recent slide reflects concerns around weak same-store sales and cautious 2026 guidance, but sharp drops like this often raise a tougher question: is the weakness temporary, or a sign of deeper cracks in the story?
Before judging its downturn reslience, let’s look at where Wendy’s stands today.
- Size: Wendy’s is a $1.4 Bil company with $2.2 Bil in revenue currently trading at $7.15.
- Fundamentals: Last 12 month revenue growth of -3.1% and operating margin of 16.3%.
- Liquidity: Has Debt to Equity ratio of 3.05 and Cash to Assets ratio of 0.06
- Valuation: Wendy’s stock is currently trading at P/E multiple of 8.2 and P/EBIT multiple of 3.8
- Has one instance since 2010 where it dipped >30% in < 30 days and subsequently returned 69.6% within a year. See WEN Dip Buy Analysis.
These metrics point to a Weak operational performance, alongside Low valuation – making the stock Risky. For details, see Buy or Sell WEN Stock
That brings us to the key consideration for investors worried about this fall: how resilient is WEN stock if markets turn south? This is where our downturn resilience framework comes in. Suppose WEN stock falls another 20-30% to $5 – can investors comfortably hold on? Turns out, the stock has fared worse than the S&P 500 index during various economic downturns, based on (a) how much the stock fell and, (b) how quickly it recovered. Below, we dive deeper into each such downturn.
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2022 Inflation Shock
- WEN stock fell 44.3% from a high of $28.87 on 8 June 2021 to $16.07 on 11 May 2022 vs. a peak-to-trough decline of 25.4% for the S&P 500.
- The stock is yet to recover to its pre-Crisis high
- The highest the stock has reached since then is $23.83 on 15 May 2023 , and currently trades at $7.15
| WEN | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -44.3% | -25.4% |
| Time to Full Recovery | Not Fully Recovered | 464 days |
2020 Covid Pandemic
- WEN stock fell 68.8% from a high of $23.94 on 21 February 2020 to $7.47 on 18 March 2020 vs. a peak-to-trough decline of 33.9% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 9 October 2020
| WEN | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -68.8% | -33.9% |
| Time to Full Recovery | 205 days | 148 days |
2018 Correction
- WEN stock fell 18.6% from a high of $18.43 on 20 August 2018 to $15.00 on 24 December 2018 vs. a peak-to-trough decline of 19.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 12 April 2019
| WEN | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -18.6% | -19.8% |
| Time to Full Recovery | 109 days | 120 days |
2008 Global Financial Crisis
- WEN stock fell 86.8% from a high of $21.46 on 11 January 2007 to $2.84 on 27 October 2008 vs. a peak-to-trough decline of 56.8% for the S&P 500.
- However, the stock fully recovered to its pre-Crisis peak by 26 August 2019
| WEN | S&P 500 | |
|---|---|---|
| % Change from Pre-Recession Peak | -86.8% | -56.8% |
| Time to Full Recovery | 3,955 days | 1,480 days |
Feeling jittery about WEN stock? Consider portfolio approach.
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