The Williams Companies, Inc. (WMB) — Fundamental Analysis & Key Financial Ratios

Kaplio's reading: The Williams Companies, Inc.

Updated on September 25, 2026 · accounts published on August 3, 2026

Reading of September 25, 2026: A growing, high-margin business carrying heavy debt and a dividend its cash flow does not cover

Williams Companies trades at a P/E of 28.0 over the last 12 months, 63 % above its sector median, with free cash flow covering only 0.4× its dividend.

• Is Williams Companies expensive or cheap? It trades at a P/E of 28.0, 63 % above its sector median, and has been cheaper than this in 55 % of the past decade's quarters.
• How is the business doing? Revenue grew 13.8 % and EPS 17.6 % over the last 12 months, with a 40.3 % operating margin against a 22.1 % twelve-year average.
• How strong is the balance sheet? Net debt of $25.20 per share equals 34.7 % of the price, and the 2.9 % dividend absorbs 93 % of fiscal 2025 earnings.
• What to expect from the next earnings? Results land on November 2, 2026, with consensus at $0.56 EPS after a $0.50 quarter that matched estimates on August 3, 2026.
• Does it generate cash through the cycle and cover the dividend? Free cash flow yield is 1.2 % against the 8 % considered healthy in energy, and covers the dividend only 0.4× in fiscal 2025.

Is Williams Companies expensive or cheap?

At 28.0× earnings over the last 12 months, Williams Companies sits 7 % below its own ten-year average of 30.3×, a decade that ranged from 14.4× to 72.4×. That sounds reasonable until you compare it with the 198 companies in its sector, whose median P/E is 17.2×: a 63 % premium. The stock has been cheaper than this in 55 % of the past decade's quarters, and at 15.8× EV/EBITDA against a ten-year average of 13.1× the enterprise multiple looks stretched too. The shares are up 15 % over 12 months and sit 10 % below the $79.40 52-week high.

How is the business doing?

Operations are running well above their own history. Revenue rose 13.8 % and EPS 17.6 % over the last 12 months, and the 40.3 % operating margin compares with a 22.1 % average across fiscal 2014 to 2025, another step up from the 36.8 % posted in fiscal 2025. Net margin is 25.2 % and ROE 23.9 % over the same period. The weak spot is capital efficiency: ROIC of 6.6 % sits 0.7 points below the 7.3 % median of the 226 companies in its sector, and the company has not cleared 10 % in any of the last ten fiscal years.

How strong is the balance sheet?

This is a leveraged balance sheet. Net debt stood at $25.20 per share at the close of fiscal 2025, $25.25 of debt against $0.05 of cash, equal to 34.7 % of the current price. Debt to equity is 2.33 and the current ratio 0.48 over the last 12 months, while the Altman Z score of 1.1 falls in the danger zone, even if Piotroski scores a respectable 6 of 9. The dividend yields 2.9 % and has risen for 8 consecutive fiscal years, but a 93 % payout of fiscal 2025 earnings leaves little cushion.

What to expect from the next earnings?

The company reports again on November 2, 2026, and analysts model EPS of $0.56 after the $0.50 delivered on August 3, 2026, which matched the $0.50 expected. Estimates are steady: the 2026 EPS consensus has held at $2.46 over the last 10 days across 9 analysts, and revenue forecasts have barely moved either. The track record is mixed, with beats in 3 of the last 8 quarters. Of the 34 analysts covering the stock, 27 rate it a buy and 7 a hold, with no sell ratings, so upgrades are an unlikely source of fuel.

Does it generate cash through the cycle and cover the dividend?

Oil and gas companies live with the commodity cycle, so the test is cash across the whole cycle and whether the dividend survives it, not one year's earnings. Williams Companies passes one check: free cash flow was positive in 10 of the last 10 fiscal years, above the 8-in-10 bar. The rest fall short. Free cash flow yield of 1.2 % over the last 12 months is far from the healthy 8 %, dividend coverage was 0.4× in fiscal 2025 against a 1.2× bar, net debt is 4.0× EBITDA where under 2× is healthy, and capex took 40.9 % of fiscal 2025 revenue against a 10 % to 20 % range.

How this was prepared: the data comes from companies' official filings, collected by a professional provider, and from Kaplio's analysis engine (trailing-12-month ratios, 10 years of history and sector medians computed across US-listed companies). The text is written from that data alone, every figure is checked against it before publication, and it is reviewed when the company reports results. This is not investment advice.