October 26, 2023
Top 10 Stock Arab Bank Group 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: Arab Bank Group – Top 10 Stock in Good Governance in Growth Markets
Arab Bank Group is listed as a top 10 stock on October 26, 2023 in the market index Good Governace Growth Markets 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, despite a currently slow growth momentum. Based on the Obermatt 360° View of 85 (top 85% performer), Obermatt assesses an overall strong buy recommendation for Arab Bank Group on October 26, 2023.
Snapshot: Obermatt Ranks
| Country | Jordan |
| Industry | Diversified Banks |
| Index | Good Governace Growth Markets, Independent Boards Growth Markets, Renewables Users |
| Size class | XX-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 Arab Bank Group Strong Buy
| 360 METRICS | October 26, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 97 |
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| GROWTH | ||||||||
| GROWTH | 1 |
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| SAFETY | ||||||||
| SAFETY | 81 |
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| SENTIMENT | ||||||||
| SENTIMENT | 81 |
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| 360° VIEW | ||||||||
| 360° VIEW | 85 |
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ANALYSIS: With an Obermatt 360° View of 85 (better than 85% compared with alternatives) for 2023, overall professional sentiment and financial characteristics for the stock Arab Bank Group are very positive. The 360° View is based on consolidating four consolidated indicators, with half of the indicators below and half above average for Arab Bank Group. The consolidated Value Rank has an attractive rank of 97, which means that the share price of Arab Bank Group 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 97% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 81. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 81. But the consolidated Growth Rank has a low rank of 1, which means that the company is below average in terms of growth and momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. 99 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 85, Arab Bank Group is better positioned than 85% of all alternative stock investment opportunities based on the Obermatt Method. Three out of four consolidated Obermatt Ranks show above-average performance. The stock has as good value (Value Rank of 97), secure financing practices (Safety Rank of 81), and positive market sentiment in the professional investor community (Sentiment Rank of 81). It is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely to occur. The company’s growth expectations are below the industry average (Growth Rank of 1), but that could also be temporary since professional investors remain optimistic despite the low growth numbers. The low price as reflected in the good Value Rank could indicate that the company's future is challenging. The below-par growth performance may be the reason for this. Companies that grow less are typically cheaper than fast-growing competitors. We recommend evaluating whether the future of Arab Bank Group is as difficult as the stock’s low price suggests, despite the positive professional investor sentiment. Since the professional community is optimistic, you might have less to worry about, and the stock may just go through a more challenging phase now, indicating good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for Arab Bank Group very positive
ANALYSIS: With an Obermatt Sentiment Rank of 81 (better than 81% compared with alternatives) for 2023, overall professional sentiment and engagement for the stock Arab Bank Group is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Arab Bank Group. Analyst Opinions are at a rank of 87 (better than 87% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. In addition, Analyst Opinions Change has a rank of 50, which means that currently, stock research experts are getting even more optimistic. Obermatt Market Pulse further supports this with a rank of 100, which means that the current professional news and professional social networks are generally positive when discussing this company (more positive news than for 100% of competitors). But there are few stock holdings by institutional investors. The Professional Investors rank is low at 11, which means that currently, professional investors hold less stock in this company than in 89% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 81 (more positive than 81% compared with investment alternatives), Arab Bank Group has a reputation among professional investors that is significantly higher than that of its competitors. Not having too many professionals invested in Arab Bank Group may be less of an issue, especially if the stock is from a smaller company where professionals typically invest less. It is natural for professional investors to focus on large and extra-large companies, as they provide more safety. Smaller companies attract fewer professionals in the shareholder community. Overall, the signals from the professionals are still quite favorable for investments in Arab Bank Group. ...read more
Value Strategy: Arab Bank Group Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 97 (better than 97% compared with alternatives) for 2023, Arab Bank Group shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Arab Bank Group. Price-to-Sales is 72 which means that the stock price compared with what market professionals expect for future sales is lower than for 72% of comparable companies, indicating a good value for Arab Bank Group's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 85% 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 97. Compared with other companies in the same industry, dividend yields of Arab Bank Group are expected to be higher than for 90% of all competitors (a Dividend Yield rank of 90). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 97, is a buy recommendation based on Arab Bank Group'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 Arab Bank Group based on its detailed value metrics.
Growth Strategy: Arab Bank Group Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 1 (better than 1% compared with alternatives), Arab Bank Group shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for Arab Bank Group. Only Capital Growth has a good rank of 53, which means that currently professionals expect the company to grow its invested capital more than 20% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 1 which means that currently professionals expect the company to grow less than 99% of its competitors. Profit Growth with a rank of 20 and Stock Returns with a rank of 25 are also low (below 75% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 1, is a sell recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Arab Bank Group is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. ...read more
Safety Strategy: Arab Bank Group Debt Financing Safety very solid
| SAFETY METRICS | October 26, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 100 |
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| REFINANCING | ||||||||
| REFINANCING | 23 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 56 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 81 |
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ANALYSIS: With an Obermatt Safety Rank of 81 (better than 81% compared with alternatives) for 2023, the company Arab Bank Group has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Arab Bank Group 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 two out of three indicators above average for Arab Bank Group. Leverage is at a rank of 100, meaning the company has a below-average debt-to-equity ratio. It has less debt than 100% of its competitors. Liquidity is also good at a rank of 56, meaning the company generates more profit to service its debt than 56% 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 23, 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 77% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 81 (better than 81% compared with alternatives), Arab Bank Group has a financing structure that is significantly safer 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 Arab Bank Group. 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: Arab Bank Group Top Financial Performance
| COMBINED PERFORMANCE | October 26, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 97 |
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| GROWTH | ||||||||
| GROWTH | 1 |
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| SAFETY | ||||||||
| SAFETY | 56 |
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| COMBINED | ||||||||
| COMBINED | 81 |
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ANALYSIS: With an Obermatt Combined Rank of 81 (better than 81% compared with investment alternatives), Arab Bank Group (Diversified Banks, Jordan) shares have much better financial characteristics than comparable stocks. Shares of Arab Bank Group are a good value (attractively priced) with a consolidated Value Rank of 97 (better than 97% of alternatives), are safely financed (Safety Rank of 81, which means low debt burdens), but show below-average growth (Growth Rank of 1). ...read more
RECOMMENDATION: A Combined Rank of 81, is a strong buy recommendation based on Arab Bank Group's financial characteristics. As the company Arab Bank Group's key financial metrics exhibit good value (Obermatt Value Rank of 97) but low growth (Obermatt Growth Rank of 1) while being safely financed (Obermatt Safety Rank of 81), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 97% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. ...read more
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