September 21, 2023
Top 10 Stock CapitaLand Investment Sell 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: CapitaLand Investment – Top 10 Stock in Straits Times Index STI
CapitaLand Investment is listed as a top 10 stock on September 21, 2023 in the market index STI because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company enjoys a positive professional investor sentiment, but all financial facts speak against a stock purchase. This is probably an investment into the future. Based on the Obermatt 360° View of 22 (22% performer), Obermatt issues an overall sell recommendation for CapitaLand Investment on September 21, 2023.
Snapshot: Obermatt Ranks
| Country | Singapore |
| Industry | Real Estate: Operating Services |
| Index | Energy Efficient, Low Waste, STI |
| Size class | 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 CapitaLand Investment Sell
| 360 METRICS | September 21, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 19 |
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| GROWTH | ||||||||
| GROWTH | 37 |
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| SAFETY | ||||||||
| SAFETY | 13 |
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| SENTIMENT | ||||||||
| SENTIMENT | 89 |
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| 360° VIEW | ||||||||
| 360° VIEW | 22 |
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ANALYSIS: With an Obermatt 360° View of 22 (better than 22% compared with alternatives), overall professional sentiment and financial characteristics for the stock CapitaLand Investment are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for CapitaLand Investment. The consolidated Sentiment Rank has a good rank of 89, which means that professional investors are more optimistic about the stock than for 89% of alternative investment opportunities. But all other ranks are below average. The consolidated Value Rank has a rank of 19, which means that the share price of CapitaLand Investment is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. The consolidated Growth Rank also has a low rank of 37, meaning that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. This means that growth is lower than for 37% of competitors in the same industry. Finally, the consolidated Safety Rank has a riskier rank of 13 which means that the company has a riskier financing structure than 87% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. ...read more
RECOMMENDATION: With a consolidated 360° View of 22, CapitaLand Investment is worse than 78% of all alternative stock investment opportunities based on the Obermatt Method. This means that CapitaLand Investment shares are on the riskier side for investors. As only the professional market sentiment (Sentiment Rank of 89) is above-average, and all other consolidated Obermatt Ranks are below peers, the stock investing proposition case is rather weak. The stock price is expensive for a company of this size in this industry, visible in the below-average Value Rank. Growth is below the competition based on the Growth Rank, and the company has more debt than other companies, according to the Safety Rank. So the question becomes: How important is the Sentiment Rank when all others are below average? When it comes to growth, the low rating might be justified if growth is expected in the future and not yet reflected in current performance. This is often the case for companies with intellectual property, such as technology and pharmaceutical companies. In the early phases, these companies are expensive compared with their size and may have a lot of debt on their books, as is the case here, as seen in the low Value and Safety Ranks. Future growth may be the strongest investment rationale in this case, which is only reflected by institutional investors' opinions. You pay more than the market average for this stock and invest in a rather debt-loaded enterprise, but it may be worth it if the future of CapitaLand Investmenṭ is bright. A small investment might be justified, but proceed with caution. ...read more
Sentiment Strategy: Professional Market Sentiment for CapitaLand Investment very positive
ANALYSIS: With an Obermatt Sentiment Rank of 89 (better than 89% compared with alternatives) for 2023, overall professional sentiment and engagement for the stock CapitaLand Investment is very positive. The Sentiment Rank is based on consolidating four sentiment indicators where all but one are above average for CapitaLand Investment. Analyst Opinions are at a rank of 93 (better than 93% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. The Professional Investors rank is also good at 73, which means that currently, professional investors hold more stock in this company than in 73% of alternative investment opportunities. Pros tend to favor investing in this company. In addition, Market Pulse has a rank of 93 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 93% of competitors). But Analyst Opinions Change has a below-average rank of 18, which means that stock research experts are currently changing their opinions for the worse when it comes to recommending this stock. In other words, they are getting more critical of investments in CapitaLand Investment. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 89 (more positive than 89% compared with investment alternatives), CapitaLand Investment has a reputation among professional investors that is significantly higher than that of its competitors. This is an early sign of caution, even if the stock has significantly appreciated. If analysts change their opinions, the stock may become too expensive. If the price is on the way down, the trend may continue. This may be a stock with a good reputation and history, but it may have reached its breaking point by now. Investors should look at the Value Ranks as well. If they indicate trouble, it might just materialize in the future. ...read more
Value Strategy: CapitaLand Investment Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 19 (worse than 81% compared with alternatives), CapitaLand Investment shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for CapitaLand Investment. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 68% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 25 which means that the stock price compared with what market professionals expect for future profits is higher than 75% of comparable companies, indicating a low value concerning CapitaLand Investment's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 17 which means that the stock price compared with what market professionals expect for future profit levels is higher than 83% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 41 is also low. Compared with invested capital, the stock price is higher than for 59% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 19, is a sell recommendation based on CapitaLand Investment's stock price compared with the company's operational size and dividend yields. Should dividend investors pick CapitaLand Investment? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose CapitaLand Investment only if they reasonably expect the low current profit levels to be transitory. ...read more
Growth Strategy: CapitaLand Investment Growth Momentum low
| GROWTH METRICS | September 21, 2023 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 67 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 88 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 12 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 19 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 37 |
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ANALYSIS: With an Obermatt Growth Rank of 37 (better than 37% compared with alternatives), CapitaLand Investment 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 CapitaLand Investment. Sales Growth has a rank of 67, which means that, currently, professionals expect the company to grow more than 67% of its competitors. Profit Growth with a rank of 88 is also above average. But Capital Growth has only a rank of 12, and Stock Returns with 19 are also below-average. Stock returns for CapitaLand Investment have recently been below 81% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 37, is a hold recommendation for growth and momentum investors. Are investors forecasting troubles based on the lack of operating investment activity at the company? This could be one explanation as to why stock returns are low. But stock returns can also be the result of correcting an error in the past, in this case, an overly optimistic outlook on the future, which is now more realistic. The Value Ranks may confirm such a picture. The more important growth indicators are revenues and profits, which are both above average for CapitaLand Investment. This is a positive sign from the company's operational side and may give investors courage, despite the poor recent stock price performance. ...read more
Safety Strategy: CapitaLand Investment Debt Financing Safety risky
| SAFETY METRICS | September 21, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 40 |
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| REFINANCING | ||||||||
| REFINANCING | 31 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 34 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 13 |
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ANALYSIS: With an Obermatt Safety Rank of 13 (better than 13% compared with alternatives), the company CapitaLand Investment has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of CapitaLand Investment is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with all three metrics below average for CapitaLand Investment. Liquidity is at 34, meaning that the company generates less profit to service its debt than 66% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 40, meaning the company has an above-average debt-to-equity ratio. It has more debt than 60% of its competitors. Finally, Refinancing is at a rank of 31 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 69% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 13 (worse than 87% compared with alternatives), CapitaLand Investment has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing.
Combined financial peformance: CapitaLand Investment Lowest Financial Performance
| COMBINED PERFORMANCE | September 21, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 19 |
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| GROWTH | ||||||||
| GROWTH | 37 |
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| SAFETY | ||||||||
| SAFETY | 34 |
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| COMBINED | ||||||||
| COMBINED | 1 |
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ANALYSIS: With an Obermatt Combined Rank of 1 (worse than 99% compared with investment alternatives), CapitaLand Investment (Real Estate: Operating Services, Singapore) shares have lower financial characteristics compared with similar stocks. Shares of CapitaLand Investment are low in value (priced high) with a consolidated Value Rank of 19 (worse than 81% of alternatives), show below-average growth (Growth Rank of 37), and are riskily financed (Safety Rank of 13), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 1, is a sell recommendation based on CapitaLand Investment's financial characteristics. As the company CapitaLand Investment's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 19), low growth (Obermatt Growth Rank of 37), and risky financing practices (Obermatt Safety Rank of 13), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. ...read more
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