Fact based stock research
Pirelli (BIT:PIRC)

IT0005278236

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.

Pirelli stock research in summary

pirelli.com

ANALYSIS: With an Obermatt Combined Rank of 14 (worse than 86% compared with investment alternatives), Pirelli (Tires & Rubber, Italy) shares have lower financial characteristics compared with similar stocks. Shares of Pirelli are low in value (priced high) with a consolidated Value Rank of 45 (worse than 55% of alternatives), show below-average growth (Growth Rank of 38), and are riskily financed (Safety Rank of 34), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 14, is a sell recommendation based on Pirelli's financial characteristics. As the company Pirelli's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 45), low growth (Obermatt Growth Rank of 38), and risky financing practices (Obermatt Safety Rank of 34), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	45
Growth Rank	38
Safety Rank	34
Combined Rank	14

Country	Italy
Industry	Tires & Rubber
Index	MIB, MIB, Low Emissions, Energy Efficient, Human Rights
Size class	X-Large

25-Apr-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.

Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Pirelli

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	n/a	50	62	45
GROWTH
GROWTH	n/a	87	29	38
SAFETY
SAFETY	n/a	18	45	34
SENTIMENT
SENTIMENT	n/a	34	94	^new
360° VIEW
360° VIEW	n/a	38	64	^new

Most recent update of the stock research: 25-Apr-2024. Financial reporting date used for calculating ranks: 31-Dec-2023. Stock research history is based on the Obermatt Method. The higher the rank, the better Pirelli is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	n/a	50	62	45
GROWTH
GROWTH	n/a	87	29	38
SAFETY
SAFETY	n/a	18	45	34
COMBINED
COMBINED	n/a	53	32	14

Last update of combined financial performance: 25-Apr-2024. Stock analysis on combined financial performance: The higher the rank of Pirelli the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 45 (worse than 55% compared with alternatives), Pirelli shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Pirelli. Expected dividend yields are higher than for 58% of comparable companies (a Dividend Yield rank of 58), making the stock attractive. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 58, which means that the stock price is lower compared with invested capital than for 58% of comparable investments. But in respect to sales and profits, the picture is reversed. Price-to-Sales is 32 which means that the stock price compared with what market professionals expect for future profits is higher than for 68% of comparable companies, indicating a low value concerning Pirelli's sales levels. The Price-to-Profit ratio (also referred to as price-earnings (P/E) ratio) is also unfavorable for Pirelli with a rank of 48. This means that the stock price, compared with what market professionals expect for future profits, is higher than for 52% of comparable companies, indicating a low value concerning Pirelli's profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 45, is a hold recommendation based on Pirelli's stock price compared with the company's operational size and dividend yields. The company seems confident that it can generate a reasonable return on invested capital, because it pays an above-average dividend while profits are below what you would expect for a company with this stock price. If you agree with this practice and believe that profits will return to higher levels, as the current dividend policy suggests, Pirelli may be an attractive investment. If this is not the case, you may want to be careful with this stock as it is also expensive compared with its expected revenue levels. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	n/a	34	41	32
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	n/a	47	65	48
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	n/a	74	64	58
DIVIDEND YIELD
DIVIDEND YIELD	n/a	64	70	58
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	n/a	50	62	45

Last update of Value Rank: 25-Apr-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Pirelli; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 38 (better than 38% compared with alternatives), Pirelli shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for Pirelli. Sales Growth has a below market rank of 32, which means that, currently, professionals expect the company to grow less than 68% of its competitors. The same is valid for Capital Growth, with a rank of 43, and Profit Growth, with a rank of 30. Currently, professionals expect the company to grow its profits less than 70% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 81, which means that the stock returns have recently been above 81% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 38, is a hold recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for Pirelli, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with recent above-market stock returns. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive stock returns are not yet a sign of recovery. Investors should look closely at the Value and Sentiment indicators before they make a stock purchasing decision, because growth is unlikely to be the driving argument behind this investment. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is low here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	n/a	37	35	32
PROFIT GROWTH
PROFIT GROWTH	n/a	43	30	30
CAPITAL GROWTH
CAPITAL GROWTH	n/a	79	28	43
STOCK RETURNS
STOCK RETURNS	n/a	92	67	81
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	n/a	87	29	38

Last update of Growth Rank: 25-Apr-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Pirelli.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 34 (better than 34% compared with alternatives), the company Pirelli 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 Pirelli 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 just one indicator above average for Pirelli and the other two below average. Leverage is at a rank of 55 meaning the company has a below-average debt-to-equity ratio. It has less debt than 55% of its competitors.Refinancing is at a rank of 32, which means that the portion of the debt about to be refinanced is above-average. It has more debt in the refinancing stage than 68% of its competitors. Liquidity is at a rank of 45, meaning that the company generates less profit to service its debt than 55% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 34 (worse than 66% compared with alternatives), Pirelli has a financing structure that is riskier than that of its competitors. This is an indication that the company is on the riskier side when it comes to debt service. There is only below-market average liquidity, and a short-term refinancing issue might be around the corner. But in the long-term, the debt levels of Pirelli are on the safer side. Investors may have a short-term debt challenge and liquidity issues with Pirelli and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	n/a	37	46	55
REFINANCING
REFINANCING	n/a	14	59	32
LIQUIDITY
LIQUIDITY	n/a	44	40	45
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	n/a	18	45	34

Last update of Safety Rank: 25-Apr-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Pirelli and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	43	70	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	69	89	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	31	94	^new
MARKET PULSE
MARKET PULSE	n/a	17	49	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	34	94	^new

Last update of Sentiment Rank: 25-Apr-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Pirelli.
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