May 11, 2023
Top 10 Stock ArcelorMittal 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: ArcelorMittal – Top 10 Stock in AEX Index
ArcelorMittal is listed as a top 10 stock on May 11, 2023 in the market index AEX 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° Rank of 69 (high 69% performer), Obermatt assesses an overall buy recommendation for ArcelorMittal on May 11, 2023.
Snapshot: Obermatt Ranks
| Country | Luxembourg |
| Industry | Steel |
| Index | AEX, CAC 40, CAC All, SBF 120, IBEX 35, Low Emissions, Human Rights |
| 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° Assessment ArcelorMittal Buy
| 360 METRICS | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 61 |
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| GROWTH | ||||||||
| GROWTH | 33 |
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| SAFETY | ||||||||
| SAFETY | 60 |
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| SENTIMENT | ||||||||
| SENTIMENT | 77 |
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| 360° VIEW | ||||||||
| 360° VIEW | 69 |
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ANALYSIS: With an Obermatt 360° Rank of 69 (better than 69% compared with alternatives), overall professional sentiment and engagement for the stock ArcelorMittal are above average. The 360° Rank is based on consolidating four consolidated indicators, with half of the indicators below and half above average for ArcelorMittal. The consolidated Value Rank has an attractive rank of 61, which means that the share price of ArcelorMittal 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 61% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 60. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 77. But the consolidated Growth Rank has a low rank of 33, 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. 67 of its competitors have better growth. ...read more
RECOMMENDATION: With a 360° Rank of 69, ArcelorMittal is better than 69% 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 61), secure financing practices (Safety Rank of 60), and positive market sentiment in the professional investor community (Sentiment Rank of 77). 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 growth expectations are below the industry average (Growth Rank of 33), 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 ranking can sometimes 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 ArcelorMittal 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 ArcelorMittal very positive
ANALYSIS: With an Obermatt Sentiment Rank of 77 (better than 77% compared with alternatives) for 2023, overall professional sentiment and engagement for the stock ArcelorMittal is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for ArcelorMittal. Analyst Opinions are at a rank of 67 (better than 67% 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 89, which means that stock research experts are changing their opinions for the better in recommending investing in the company. In other words, they are getting even more optimistic about investments in ArcelorMittal. Finally, the Professional Investors rank is 65, which means that currently, professional investors hold more stock in this company than in 65% of alternative investment opportunities. ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 77 (more positive than 77% compared with investment alternatives), ArcelorMittal has a reputation among professional investors that is significantly higher than that of its competitors. Pros tend to favor investing in this company. But there is also a signal for caution. Market Pulse has a rank of 44, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 56% of competitors). This could mean future risks and should make investors careful. Attention to negative news for ArcelorMittal is worthwhile because they may be early warning signals. Without those, all other professional signals are encouraging, especially since analysts are getting more optimistic. ...read more
Value Strategy: ArcelorMittal Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 61 (better than 61% compared with alternatives), ArcelorMittal shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for ArcelorMittal. Price-to-Sales (P/S) has a value of 81, which means that the stock price compared with what market professionals expect for future sales is lower than 81% of comparable companies, indicating a good value concerning ArcelorMittal's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than 77% of alternatives, and it's also true for Price-to-Book Capital (also referred to as market-to-book ratio) with an Obermatt Price-to-Capital Rank of 92. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 21% of all competitors have even lower dividend yields than ArcelorMittal (an Obermatt Dividend Yield Rank of 21). 79% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 61, is a BUY recommendation based on ArcelorMittal's stock price compared with the company's operational size and dividend yields. The below-average dividend yield may be a good sign, as it could mean the company has more attractive investment opportunities for the generated cash than to pay it out as dividends. A low dividend yield can also indicate a growth phase. ...read more
Growth Strategy: ArcelorMittal Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 33 (better than 33% compared with alternatives), ArcelorMittal 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 half of the indicators below and half above average for ArcelorMittal. Capital Growth has a rank of 63, which means that currently professionals expect the company to grow its invested capital more than 17% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 53 (above 53% of alternative investments). But Sales Growth has only a rank of 28, which means that, currently, professionals expect the company to grow less than 72% of its competitors, and Profit Growth is also low at a rank of 17. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 33, is a HOLD recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for ArcelorMittal, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. ...read more
Safety Strategy: ArcelorMittal Debt Financing Safety above-average
| SAFETY METRICS | May 11, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 64 |
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| REFINANCING | ||||||||
| REFINANCING | 61 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 65 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 60 |
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ANALYSIS: With an Obermatt Safety Rank of 60 (better than 60% compared with alternatives), the company ArcelorMittal 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 ArcelorMittal 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, where all three are above average for ArcelorMittal. Leverage is at 64, meaning the company has a below-average debt-to-equity ratio. It has less debt than 64% of its competitors. Refinancing is at a rank of 61, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 61% of its competitors. Finally, Liquidity is also good at a rank of 65, which means that the company generates more profit to service its debt than 65% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 60 (better than 60% compared with alternatives), ArcelorMittal has a financing structure that is safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more
Combined financial peformance: ArcelorMittal Above-Average Financial Performance
| COMBINED PERFORMANCE | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 61 |
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| GROWTH | ||||||||
| GROWTH | 33 |
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| SAFETY | ||||||||
| SAFETY | 65 |
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| COMBINED | ||||||||
| COMBINED | 54 |
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ANALYSIS: With an Obermatt Combined Rank of 54 (better than 54% compared with investment alternatives), ArcelorMittal (Steel, Luxembourg) shares have above-average financial characteristics compared with similar stocks. Shares of ArcelorMittal are a good value (attractively priced) with a consolidated Obermatt Value Rank of 61 (better than 61% of alternatives), are safely financed (Safety Rank of 60, which means low debt burdens), but show below-average growth (Growth Rank of 33). ...read more
RECOMMENDATION: An Obermatt Combined Rank of 54, is a buy recommendation based on ArcelorMittal's financial characteristics. As the company ArcelorMittal's key financial metrics exhibit good value (Obermatt Value Rank of 61) but low growth (Obermatt Growth Rank of 33) while being safely financed (Obermatt Safety Rank of 60), it may be a safer investment because companies with low debt can better withstand times of crises. The good value, better than 61% 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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