January 11, 2024
Top 10 Stock Asahi Kasei 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: Asahi Kasei – Top 10 Stock in Tokyo Stock Exchange TOPIX 100
Asahi Kasei is listed as a top 10 stock on January 11, 2024 in the market index TOPIX 100 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 84 (top 84% performer), Obermatt assesses an overall strong buy recommendation for Asahi Kasei on January 11, 2024.
Snapshot: Obermatt Ranks
| Country | Japan |
| Industry | Commodity Chemicals |
| Index | TOPIX 100, Low Emissions, Energy Efficient, Nikkei 225 |
| 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 Asahi Kasei Strong Buy
| 360 METRICS | January 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 79 |
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| GROWTH | ||||||||
| GROWTH | 87 |
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| SAFETY | ||||||||
| SAFETY | 53 |
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| SENTIMENT | ||||||||
| SENTIMENT | 34 |
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| 360° VIEW | ||||||||
| 360° VIEW | 84 |
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ANALYSIS: With an Obermatt 360° View of 84 (better than 84% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock Asahi Kasei are very positive. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators above average for Asahi Kasei. The consolidated Value Rank has an attractive rank of 79, which means that the share price of Asahi Kasei is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 79% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 87, 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 53. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of only 34. Professional investors are more confident in 66% other stocks. ...read more
RECOMMENDATION: With a consolidated 360° View of 84, Asahi Kasei is better positioned than 84% 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 79), above-average growth (Growth Rank of 87), and safe financing practices (Safety Rank of 53), 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 34), 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 Asahi Kasei 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 Asahi Kasei only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 34 (better than 34% compared with alternatives), overall professional sentiment and engagement for the stock Asahi Kasei is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half the indicators below and the other half above average for Asahi Kasei. Analyst Opinions are at a rank of 34 (worse than 66% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 34, which means that stock research experts are getting more pessimistic. It doesn't end with the analysts. Market Pulse is also low with a rank of 30, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 70% of competitors). On the upside, the Professional Investors rank is 81, which means that professional investors hold more stock in this company than in 81% of alternative investment opportunities. Pros tend to favor investing in this company. This could be due to a large company size, which could contribute to the higher share of professional investors in the company. If this is not the case, the low sentiment ranks are more challenging to explain. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 34 (less encouraging than 66% compared with investment alternatives), Asahi Kasei has a reputation among professional investors that is below that of its competitors. Should the company be on the smaller side, the presence of professional investors could be reassuring. That would make Asahi Kasei stock something like a hidden gem. Investors should make sure with further research that this is true, because all other sentiment indicators are negative which is a sign for caution. ...read more
Value Strategy: Asahi Kasei Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 79 (better than 79% compared with alternatives) for 2024, Asahi Kasei shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Asahi Kasei. Price-to-Sales is 69 which means that the stock price compared with what market professionals expect for future sales is lower than for 69% of comparable companies, indicating a good value for Asahi Kasei's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 67% 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 62. Compared with other companies in the same industry, dividend yields of Asahi Kasei are expected to be higher than for 78% of all competitors (a Dividend Yield rank of 78). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 79, is a buy recommendation based on Asahi Kasei'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 Asahi Kasei based on its detailed value metrics.
Growth Strategy: Asahi Kasei Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 87 (better than 87% compared with alternatives) for 2024, Asahi Kasei 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 Asahi Kasei. Profit Growth has a rank of 94 which means that currently professionals expect the company to grow its profits more than 94% of its competitors. The same is valid for capital growth and stock returns. Capital Growth has a rank of 58, and Stock Returns has a rank of 77 which means that the stock returns have recently been above 77% of alternative investments. Only revenue growth is low with a Sales Growth has a rank of 32 (68% of its competitors are better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 87, is a buy recommendation for growth and momentum investors. The many positive growth indicators indicate a positive growth momentum with only low revenue growth. That can also be attributed to divestments or the sale of unprofitable businesses. If that is the reason, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: Asahi Kasei Debt Financing Safety above-average
| SAFETY METRICS | January 11, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 32 |
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| REFINANCING | ||||||||
| REFINANCING | 53 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 63 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 53 |
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ANALYSIS: With an Obermatt Safety Rank of 53 (better than 53% compared with alternatives), the company Asahi Kasei 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 Asahi Kasei 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 Asahi Kasei. Refinancing is at 53, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 53% of its competitors. Liquidity is also good at 63, meaning the company generates more profit to service its debt than 63% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 32, which means the company has an above-average debt-to-equity ratio. It has more debt than 68% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 53 (better than 53% compared with alternatives), Asahi Kasei has a financing structure that is safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Asahi Kasei could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. ...read more
Combined financial peformance: Asahi Kasei Top Financial Performance
| COMBINED PERFORMANCE | January 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 79 |
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| GROWTH | ||||||||
| GROWTH | 87 |
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| SAFETY | ||||||||
| SAFETY | 63 |
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| COMBINED | ||||||||
| COMBINED | 89 |
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ANALYSIS: With an Obermatt Combined Rank of 89 (better than 89% compared with investment alternatives), Asahi Kasei (Commodity Chemicals, Japan) shares have much better financial characteristics than comparable stocks. Shares of Asahi Kasei are a good value (attractively priced) with a consolidated Value Rank of 79 (better than 79% of alternatives), show above-average growth (Growth Rank of 87), and are safely financed (Safety Rank of 53), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 89, is a strong buy recommendation based on Asahi Kasei's financial characteristics. As the company Asahi Kasei's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 79), above-average growth (Obermatt Growth Rank of 87), and indicate that the company is safely financed (Obermatt Safety Rank of 53), 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 Asahi Kasei. 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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