August 18, 2022

NOMV - We do not buy OMV - despite good Obermatt ranks

NOMV - We do not buy OMV - despite good Obermatt ranks

OMV on the ATX Top 10 List is an Austrian oil, gas and chemical company active in both upstream and downstream. While other stocks in the sector have performed well in recent months, the stock price of this stock has stagnated. This makes OMV an interesting buy candidate from a value perspective. Uwe from Obermatt Coffee Break has reviewed the stock: At Obermatt, OMV has a Value Rank of 97 and a Combined Rank of 92 (better than 92% of comparable stocks).

PRO: The following three points speak for a buy:

  1. New CEO, new strategy 2030: focus on sustainability and circular economy, climate neutral by 2050. Subsidiary Borealis will supply almost all of the sheathing for the planned north-south power lines in Germany.
  2. Sales and earnings doubled in 1H 2022, high sustainable dividend yield (5%) and very good Obermatt ranks.
  3. Analysts are half buy and half hold, price target +50%, share therefore fundamentally undervalued.

CONTRA: The following three points argue against it:

  1. High dependence on Russia with participation in Nord Stream 2 must be written off.
  2. Modest free float.
  3. Risk of recession.

On balance, direct exposure to OMV does not suggest buying, despite the attractive dividend. At least for foreign investors, reclaiming the withholding tax paid in Austria is also a hassle.

We decided to buy Telekom Austria.

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