May 18, 2023
Top 10 Stock Aker 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: Aker – Top 10 Stock in SDG 14: Life Below Water
Aker is listed as a top 10 stock on May 18, 2023 in the market index SDG 14 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 from a financial fact perspective where only investor sentiment is a reason for caution. Based on the Obermatt 360° View of 54 (high 54% performer), Obermatt assesses an overall buy recommendation for Aker on May 18, 2023.
Snapshot: Obermatt Ranks
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° Assessment Aker Buy
| 360 METRICS | May 18, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 66 |
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| GROWTH | ||||||||
| GROWTH | 79 |
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| SAFETY | ||||||||
| SAFETY | 59 |
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| SENTIMENT | ||||||||
| SENTIMENT | 28 |
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| 360° VIEW | ||||||||
| 360° VIEW | 54 |
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ANALYSIS: With an Obermatt 360° View of 54 (better than 54% compared with alternatives), overall professional sentiment and engagement for the stock Aker are above average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators above average for Aker. The consolidated Value Rank has an attractive rank of 66, which means that the share price of Aker is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 66% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 79, 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. The company is also safely financed with a Safety Rank of 59. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of only 28. Professional investors are more confident in 72% other stocks. ...read more
RECOMMENDATION: With a 360° View of 54, Aker is better than 54% 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 66), above-average growth (Growth Rank of 79) and an indication that the company is safely financed (Safety Rank of 59), 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 professional market sentiment is on the riskier side (Sentiment Rank of 28), but that could also mean an overreaction to negative news in the past. Good value is sometimes an indication that the company's future is challenging. If they have been enjoying above average growth and are still a good value, this may not continue. We recommend evaluating whether the future of Aker is as challenging as the low price of the stock despite good growth and safe financing practices suggest. Since the professional community is pessimistic, you may want to reflect these negative opinions in light of what you find reasonable to expect for the future. If you believe this pessimistic view is transitory, you have a solid investment case based on current financial factors. ...read more
Sentiment Strategy: Professional Market Sentiment for Aker only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 28 (better than 28% compared with alternatives), overall professional sentiment and engagement for the stock Aker is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Aker. Analyst Opinions are at a rank of 69 (better than 69% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive and has a rank of 50 which means that currently, stock research experts are getting even more optimistic about investments in Aker. But Market Pulse has a low rank of 1, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 99% of competitors). This is an essential sign of caution, as it could be the forebearer of bad news. Professional Investors are also somewhat absent with a rank of 40, which means that, currently, professional investors hold less stock in this company than in 60% of alternative investment opportunities. Pros tend to invest in other companies. This is expected if the company is of a smaller size (medium or smaller). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 28 (less encouraging than 72% compared with investment alternatives), Aker has a reputation among professional investors that is below that of its competitors. While the news in the professional market is negative, the analyst community is still optimistic about the company. It's an ambiguous situation with positive and negative signals from the professional side. Investors should be on the lookout for negative news but not worry too much about it as long as the overall news is still positive. ...read more
Value Strategy: Aker Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 66 (better than 66% compared with alternatives), Aker shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Aker. Price-to-Profit (also referred to as price-earnings, P/E) is 100 which means that the stock price compared with what market professionals expect for future profits is lower than for 100% of comparable companies, indicating a good value concerning Aker's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with the Price-to-Book Rank of 83, which means that the stock price is lower compared with invested capital than for 83% of comparable investments. On the other hand, Price-to-Sales is less favorable than for 73% of alternatives (only 27% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than for 66% of comparable companies, making the stock more expensive compared with the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 66, is a BUY recommendation based on Aker's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high concerning expected revenues, the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting Group or BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than distribute it to shareholders through dividends, thus sealing the company's fate early. This needs to be investigated, and the company's optimism verified before making a stock purchasing decision. ...read more
Growth Strategy: Aker Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 79 (better than 79% compared with alternatives) for 2023, Aker 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 Aker. Sales Growth has a value of 97 which means that currently professionals expect the company to grow more than 97% of its competitors. Profit Growth with a value of 100 and Capital Growth with a rank of 84 means that currently, professionals expect the company to grow both profits and invested capital more than of its competitors. But Stock Returns has only a rank of 15, which means that stock returns have recently been below 85% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 79, is a BUY recommendation for growth and momentum investors. Aker has only one below-average growth indicator, the stock returns. This is probably the least reliable growth indicator, because it measures company and investor expectations at the same time. The three other growth indicators, which are all positive for Aker, are more reliable measures of growth momentum. For this reason, the company seems to be on a good trajectory, unless you think the current period is not representative, because of unique events that will not be repeated in the future. ...read more
Safety Strategy: Aker Debt Financing Safety above-average
| SAFETY METRICS | May 18, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 46 |
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| REFINANCING | ||||||||
| REFINANCING | 72 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 39 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 59 |
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ANALYSIS: With an Obermatt Safety Rank of 59 (better than 59% compared with alternatives), the company Aker has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Aker is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with just one indicator above average for Aker and the other two below average. Refinancing is at 72, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 72% of its competitors. But Leverage is high with a rank of 46, meaning the company has an above-average debt-to-equity ratio. It has more debt than 54% of its competitors. Liquidity is also on the riskier side with a rank of 39, meaning the company generates less profit to service its debt than 61% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 59 (better than 59% compared with alternatives), Aker has a financing structure that is safer than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Aker are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making a financial decision. ...read more
Combined financial peformance: Aker Top Financial Performance
| COMBINED PERFORMANCE | May 18, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 66 |
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| GROWTH | ||||||||
| GROWTH | 79 |
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| SAFETY | ||||||||
| SAFETY | 39 |
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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), Aker (Industrial Conglomerates, Norway) shares have much better financial characteristics than comparable stocks. Shares of Aker are a good value (attractively priced) with a consolidated Obermatt Value Rank of 66 (better than 66% of alternatives), show above-average growth (Growth Rank of 79), and are safely financed (Safety Rank of 59), which means low debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 86, is a strong buy recommendation based on Aker's financial characteristics. As the company Aker's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 66), above-average growth (Obermatt Growth Rank of 79), and indicate that the company is safely financed (Obermatt Safety Rank of 59), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of Aker. 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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