January 11, 2024
Top 10 Stock Harmony Strong Buy Recommendation
How to read the ranks
For every stock, we judge its performance against its peers and rank it on a scale of 1 to 100. The higher the rank, the better the stock performs than its peers. And, we do this for six investment strategies:
Value - shows how good of a value the stock is. Green is "inexpensive"; red is "expensive".
Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".
Safety - relates to the amount of debt a company has. Green is low debt level; red is high debt level.
Combined Financial - this isn't an average of the first three ranks but rather a consolidated view across several financial indicators. Green = good; red = tread carefully.
(NEW) Sentiment - quantifies professional analyst ratings and holdings as well as market pulse. Green = positive sentiment; red = skepticism (Only available to Premium Subscribers).
(NEW) 360° View - the ultimate rating with all financial and non-financial indicators.
Snapshot: Harmony – Top 10 Stock in Uranium Mining and Production
Harmony is listed as a top 10 stock on January 11, 2024 in the market index Uranium because of its high performance in at least one of the Obermatt investment strategies. As three out of four consolidated Obermatt Ranks exhibit excellent performance, it is a solid investment where the risk of paying too much for the shares is low. Based on the Obermatt 360° View of 88 (top 88% performer), Obermatt assesses an overall strong buy recommendation for Harmony on January 11, 2024.
Snapshot: Obermatt Ranks
| Country | South Africa |
| Industry | Gold Production |
| Index | Copper, Energy Efficient, Human Rights, Gold, Silver, Uranium, Water Efficiency, JSE All Shares |
| Size class | Large |
When Obermatt identifies the Top 10 stocks in a market, it’s based on a certain investment strategy. The best performing stocks usually aren’t the ones that everyone is talking about (those are often "over-priced" and have low Value ranks).
For each investment strategy, we provide you with more detailed analysis and our recommendation. You see the ranks of the top 10 stocks ranked by that particular investment strategy (360° View, Sentiment, Value, Growth, Safety and Combined Financial Performance).
360° View: Obermatt 360° View Harmony Strong Buy
| 360 METRICS | January 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 60 |
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| GROWTH | ||||||||
| GROWTH | 95 |
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| SAFETY | ||||||||
| SAFETY | 49 |
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| SENTIMENT | ||||||||
| SENTIMENT | 57 |
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| 360° VIEW | ||||||||
| 360° VIEW | 88 |
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ANALYSIS: With an Obermatt 360° View of 88 (better than 88% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock Harmony are very positive. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Harmony. The consolidated Value Rank has an attractive rank of 60, which means that the share price of Harmony is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 60% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 95, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth, as well as stock returns. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 57. But the company’s financing is risky with a Safety rank of 49. This means 51% of comparable companies have a safer financing structure than Harmony. ...read more
RECOMMENDATION: With a consolidated 360° View of 88, Harmony is better positioned than 88% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 60), above-average growth (Growth Rank of 95), and positive market sentiment in the professional investor community (Sentiment Rank of 57), it is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely, unless information not publicly available. Only the company financing structure is on the riskier side (Safety Rank of 49), but that would also mean better returns for shareholders if things work out well. Good value is sometimes an indication that the company's future is challenging. If they have been growing above average and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of Harmony is as difficult as the low price of the stock, despite good growth and positive professional investor sentiment, suggests. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible right now, which may indicate good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for Harmony positive
ANALYSIS: With an Obermatt Sentiment Rank of 57 (better than 57% compared with alternatives), overall professional sentiment and engagement for the stock Harmony is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Harmony. Analyst Opinions are at a rank of 7 (worse than 93% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 29, which means that stock research experts are getting even more pessimistic. Other sentiment indicators are positive: The Professional Investors rank is 82, which means that professional investors hold more stock in this company than in 82% of alternative investment opportunities. So, pros tend to favor investing in this company. In addition, Market Pulse has a rank of 93, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 93% of competitors). While stock research analysts are getting ever more critical, many professional investors are committed to Harmony and the professional news channels are on the positive side. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 57 (more positive than 57% compared with investment alternatives), Harmony has a reputation among professional investors that is above-average compared with that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical, while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: Harmony Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 60 (better than 60% compared with alternatives), Harmony shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Harmony. Price-to-Sales is 62 which means that the stock price compared with what market professionals expect for future sales is lower than for 62% of comparable companies, indicating a good value for Harmony's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 75% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 60. Compared with other companies in the same industry, dividend yields of Harmony are expected to be higher than for 50% of all competitors (a Dividend Yield rank of 50). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 60, is a buy recommendation based on Harmony's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in Harmony based on its detailed value metrics.
Growth Strategy: Harmony Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 95 (better than 95% compared with alternatives) for 2024, Harmony shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Harmony. Profit Growth has a rank of 93 which means that currently professionals expect the company to grow its profits more than 93% of its competitors. The same is valid for capital growth and stock returns. Capital Growth has a rank of 55, and Stock Returns has a rank of 95 which means that the stock returns have recently been above 95% of alternative investments. Only revenue growth is low with a Sales Growth has a rank of 46 (54% of its competitors are better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 95, is a buy recommendation for growth and momentum investors. The many positive growth indicators indicate a positive growth momentum with only low revenue growth. That can also be attributed to divestments or the sale of unprofitable businesses. If that is the reason, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: Harmony Debt Financing Safety below-average
| SAFETY METRICS | January 11, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 62 |
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| REFINANCING | ||||||||
| REFINANCING | 21 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 59 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 49 |
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ANALYSIS: With an Obermatt Safety Rank of 49 (better than 49% compared with alternatives), the company Harmony has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Harmony is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Harmony. Leverage is at a rank of 62, meaning the company has a below-average debt-to-equity ratio. It has less debt than 62% of its competitors. Liquidity is also good at a rank of 59, meaning the company generates more profit to service its debt than 59% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 21, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 79% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 49 (worse than 51% compared with alternatives), Harmony has a financing structure that is riskier than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Harmony. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. ...read more
Combined financial peformance: Harmony Top Financial Performance
| COMBINED PERFORMANCE | January 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 60 |
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| GROWTH | ||||||||
| GROWTH | 95 |
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| SAFETY | ||||||||
| SAFETY | 59 |
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| COMBINED | ||||||||
| COMBINED | 86 |
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ANALYSIS: With an Obermatt Combined Rank of 86 (better than 86% compared with investment alternatives), Harmony (Gold Production, South Africa) shares have much better financial characteristics than comparable stocks. Shares of Harmony are a good value (attractively priced) with a consolidated Value Rank of 60 (better than 60% of alternatives), show above-average growth (Growth Rank of 95) but are riskily financed (Safety Rank of 49), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 86, is a strong buy recommendation based on Harmony's financial characteristics. As the company Harmony's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 60) and above-average growth (Obermatt Growth Rank of 95), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 49) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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