June 8, 2023
Top 10 Stock CenterPoint 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: CenterPoint – Top 10 Stock in Low Waste Leaders
CenterPoint is listed as a top 10 stock on June 08, 2023 in the market index Low Waste because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. While the company shows high growth, the stock price is high yet professional investor sentiment is low, which may be due to overly optimistic investor behavior, reflected in a low stock price value. Based on the Obermatt 360° View of 74 (high 74% performer), Obermatt assesses an overall buy recommendation for CenterPoint on June 08, 2023.
Snapshot: Obermatt Ranks
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 CenterPoint Buy
| 360 METRICS | June 8, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 25 |
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| GROWTH | ||||||||
| GROWTH | 95 |
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| SAFETY | ||||||||
| SAFETY | 66 |
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| SENTIMENT | ||||||||
| SENTIMENT | 43 |
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| 360° VIEW | ||||||||
| 360° VIEW | 74 |
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ANALYSIS: With an Obermatt 360° View of 74 (better than 74% compared with alternatives), overall professional sentiment and engagement for the stock CenterPoint are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for CenterPoint. The consolidated Growth Rank has a good rank of 95, 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. This means that growth is higher than for 95% of competitors in the same industry. In addition, the consolidated Safety Rank has a safer rank of 66 which means that the company has a financing structure that is safer than 66% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the consolidated Value Rank has a less desirable rank of 25 which means that the share price of CenterPoint is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is higher than for 75% of alternative stocks in the same industry. The consolidated Sentiment Rank also has a low rank of 43, which means that professional investors are more pessimistic about the stock than for 57% of alternative investment opportunities. ...read more
RECOMMENDATION: With a 360° View of 74, CenterPoint is better positioned than 74% of all alternative stock investment opportunities based on the Obermatt Method. As only half of the consolidated Obermatt Ranks exhibit excellent performance, the picture is ambiguous. Growth is above-average (Growth Rank of 95), and the company is safely financed (Safety Rank of 66). However, professional market sentiment is low(Sentiment Rank of 43). The negative market view on CenterPoint may be due to the high stock price (low value). A growth company like this may get too expensive at one point in time. If too many investors are desperate to board the train, they may drive stock prices above reasonable levels. It is typical for growth companies to have low value ratings, because investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of CenterPoint compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one hundred minus the growth rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value if the value rank is above 60. As market sentiment is low, you should be careful with paying more than market-average for this stock and conduct further research into the company’s future growth potential. ...read more
Sentiment Strategy: Professional Market Sentiment for CenterPoint only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 43 (better than 43% compared with alternatives), overall professional sentiment and engagement for the stock CenterPoint is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for CenterPoint. Analyst Opinions are at a rank of 84 (better than 84% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. This is a good sign, were it not for Analyst Opinions Change with a low rank of 48, which means that currently, stock research experts are changing their opinions for the worse. In other words, they are getting more critical of a stock investment in CenterPoint. The Professional Investors rank is also low at 25, meaning that professional investors hold less stock in this company than in 75% of alternative investment opportunities. Pros tend to invest in other companies. Even worse, Market Pulse has a low rank of 36, which means that the current professional news and professional social networks are critical of this company (more negative news than for 64% of competitors). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 43 (less encouraging than 57% compared with investment alternatives), CenterPoint has a reputation among professional investors that is below that of its competitors. There are several negative sentiment signals, with only the Analyst Opinions Rank above average. This could be a stock with a long reputation for being positive but where things are worsening. Most analysts may not see it yet, but some have, and the professionals are already quite pessimistic. Proceed with caution when investing in this stock. ...read more
Value Strategy: CenterPoint Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 25 (worse than 75% compared with alternatives), CenterPoint shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where the majority of metrics are below, and only one is above average for CenterPoint. Price-to-Sales (P/S) is 60, which means that the stock price compared with what market professionals expect for future sales is lower than 60% of comparable companies, indicating a good value concerning to CenterPoint's revenue size. But all other performance indicators point in a different direction. Dividend yields have a Dividend Yield rank of 17, meaning that dividends are expected to be lower than for 83% of comparable investments. Furthermore, Price-to-Book Capital (also referred to as market-to-book ratio) is less favorable than 61% of alternatives (only 39% of peers have an even higher ratio). The same is valid for Price-to-Profit (or Price / Earnings, P/E), which is higher than for 90% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 25, is a HOLD recommendation based on CenterPoint's stock price compared with the company's operational size and dividend yields. Since Price-to-Sales is a stable value indicator even in challenging times, investing in CenterPoint could be seen as a value investment. However, there must be a good reason for the low market-to-book rank. If the company has a typical capital investment practice, the stock may be overvalued because the profit and dividend-related performance indicators are also low. The stock is only good value if investors can expect profits and dividends to pick up in the future. Else, CenterPoint looks like an expensive investment today. ...read more
Growth Strategy: CenterPoint Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 95 (better than 95% compared with alternatives) for 2023, CenterPoint 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 CenterPoint. Profit Growth has a rank of 73 which means that currently professionals expect the company to grow its profits more than 73% of its competitors. The same is valid for capital growth and stock returns. Capital Growth has a rank of 92, and Stock Returns has a rank of 61 which means that the stock returns have recently been above 61% of alternative investments. Only revenue growth is low with a Sales Growth has a rank of 43 (57% of its competitors are better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 95, 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: CenterPoint Debt Financing Safety above-average
| SAFETY METRICS | June 8, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 28 |
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| REFINANCING | ||||||||
| REFINANCING | 72 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 65 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 66 |
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ANALYSIS: With an Obermatt Safety Rank of 66 (better than 66% compared with alternatives), the company CenterPoint 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 CenterPoint 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 CenterPoint. Refinancing is at 72, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 72% of its competitors. Liquidity is also good at 65, meaning the company generates more profit to service its debt than 65% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 28, which means the company has an above-average debt-to-equity ratio. It has more debt than 72% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 66 (better than 66% compared with alternatives), CenterPoint 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 CenterPoint 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: CenterPoint Top Financial Performance
| COMBINED PERFORMANCE | June 8, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 25 |
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| GROWTH | ||||||||
| GROWTH | 95 |
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| SAFETY | ||||||||
| SAFETY | 65 |
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| COMBINED | ||||||||
| COMBINED | 80 |
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ANALYSIS: With an Obermatt Combined Rank of 80 (better than 80% compared with investment alternatives), CenterPoint (Multi-Utilities, USA) shares have much better financial characteristics than comparable stocks. Shares of CenterPoint are low in value (priced high) with a consolidated Obermatt Value Rank of 25 (worse than 75% of alternatives). But they show above-average growth (Growth Rank of 95) and are safely financed (Safety Rank of 66, which means below-average debt burdens). ...read more
RECOMMENDATION: An Obermatt Combined Rank of 80, is a strong buy recommendation based on CenterPoint's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company CenterPoint exhibits low value (Obermatt Value Rank of 25), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 95). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 66) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more
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