January 11, 2024
Top 10 Stock Canon 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: Canon – Top 10 Stock in Tokyo Stock Exchange TOPIX 100
Canon 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 all consolidated Obermatt Ranks exhibit excellent performance, including positive market sentiment in the professional investor community, it is a solid stock investment where the risk of paying too much for the shares is limited. Based on the Obermatt 360° View of 77 (top 77% performer), Obermatt assesses an overall strong buy recommendation for Canon on January 11, 2024.
Snapshot: Obermatt Ranks
| Country | Japan |
| Industry | Technology Hardware & Peripherals |
| Index | TOPIX 100, Energy Efficient, Human Rights, Recycling, 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 Canon Strong Buy
| 360 METRICS | January 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 74 |
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| GROWTH | ||||||||
| GROWTH | 65 |
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| SAFETY | ||||||||
| SAFETY | 56 |
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| SENTIMENT | ||||||||
| SENTIMENT | 53 |
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| 360° VIEW | ||||||||
| 360° VIEW | 77 |
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ANALYSIS: With an Obermatt 360° View of 77 (better than 77% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock Canon are very positive. The 360° View is based on consolidating four consolidated indicators, with all four indicators above average for Canon. The consolidated Value Rank has an attractive rank of 74, which means that the share price of Canon 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 74% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 65, 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 56. Finally, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 53. ...read more
RECOMMENDATION: With a consolidated 360° View of 77, Canon is better positioned than 77% of all alternative stock investment opportunities based on the Obermatt Method. As all consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 74), above-average growth (Growth Rank of 65), safe financing practices (Safety Rank of 56), and a positive market sentiment in the professional investor community (Sentiment 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 to occur, unless information not publicly available. High-Value Ranks sometimes indicate that the company's future is challenging. If they are safely financed and have above average growth, and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of Canon is as difficult as the stock’s low price, despite what good growth and safe financing practice suggest. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible, which may indicate good timing right now. ...read more
Sentiment Strategy: Professional Market Sentiment for Canon positive
ANALYSIS: With an Obermatt Sentiment Rank of 53 (better than 53% compared with alternatives), overall professional sentiment and engagement for the stock Canon is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Canon. Analyst Opinions are at a rank of 14 (worse than 86% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 50, which means that stock research experts are more positive in their investment recommendations in the company. In other words, they are getting more optimistic of stock investments in Canon. More encouragingly, the Professional Investors rank is 99, which means that professional investors hold more stock in this company than in 99% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 30, 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 70% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 53 (more positive than 53% compared with investment alternatives), Canon has a reputation among professional investors that is above-average compared with that of its competitors. The sentiment signals are mixed for Canon. While analysts and the news channels are negative, there is a change in what analysts think. Above-average institutional investors in this company support them. Sentiment signals remain mixed with analysts and news channels pessimistic, though improving, and professional investors above average. ...read more
Value Strategy: Canon Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 74 (better than 74% compared with alternatives), Canon shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Canon. Price-to-Sales is 57 which means that the stock price compared with what market professionals expect for future sales is lower than for 57% of comparable companies, indicating a good value for Canon's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 77% 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 71. Compared with other companies in the same industry, dividend yields of Canon are expected to be higher than for 84% of all competitors (a Dividend Yield rank of 84). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 74, is a buy recommendation based on Canon'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 Canon based on its detailed value metrics.
Growth Strategy: Canon Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 65 (better than 65% compared with alternatives), Canon shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Canon. Profit Growth has a rank of 79, which means that currently professionals expect the company to grow its profits more than 79% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 61 (above 61% of alternative investments). But Sales Growth has a below the median rank of 26, which means that, currently, professionals expect the company to grow less than 74% of its competitors, and Capital Growth also has a lower rank of 33. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 65, is a buy recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for Canon. ...read more
Safety Strategy: Canon Debt Financing Safety above-average
| SAFETY METRICS | January 11, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 71 |
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| REFINANCING | ||||||||
| REFINANCING | 18 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 89 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 56 |
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ANALYSIS: With an Obermatt Safety Rank of 56 (better than 56% compared with alternatives), the company Canon 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 Canon 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 Canon. Leverage is at a rank of 71, meaning the company has a below-average debt-to-equity ratio. It has less debt than 71% of its competitors. Liquidity is also good at a rank of 89, meaning the company generates more profit to service its debt than 89% 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 18, 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 82% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 56 (better than 56% compared with alternatives), Canon has a financing structure that is 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 Canon. 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: Canon Top Financial Performance
| COMBINED PERFORMANCE | January 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 74 |
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| GROWTH | ||||||||
| GROWTH | 65 |
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| SAFETY | ||||||||
| SAFETY | 89 |
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| COMBINED | ||||||||
| COMBINED | 83 |
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ANALYSIS: With an Obermatt Combined Rank of 83 (better than 83% compared with investment alternatives), Canon (Technology Hardware & Peripherals, Japan) shares have much better financial characteristics than comparable stocks. Shares of Canon are a good value (attractively priced) with a consolidated Value Rank of 74 (better than 74% of alternatives), show above-average growth (Growth Rank of 65), and are safely financed (Safety Rank of 56), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 83, is a strong buy recommendation based on Canon's financial characteristics. As the company Canon's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 74), above-average growth (Obermatt Growth Rank of 65), and indicate that the company is safely financed (Obermatt Safety Rank of 56), 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 Canon. 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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