September 21, 2023
Top 10 Stock Clearway Energy 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: Clearway Energy – Top 10 Stock in SDG 7: Affordable and Clean Energy
Clearway Energy is listed as a top 10 stock on September 21, 2023 in the market index SDG 7 because of its high performance in at least one of the Obermatt investment strategies. Only the Obermatt Value Rank exhibits above-average performance, which means that the stock is seen as critical by the professional community and other financial facts are below average, conveying mixed investment signals. Based on the Obermatt 360° View of 12 (12% performer), Obermatt issues an overall sell recommendation for Clearway Energy on September 21, 2023.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Renewable Electricity |
| Index | Dividends USA, SDG 7, Sound Pay USA |
| 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 Clearway Energy Sell
| 360 METRICS | September 21, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 66 |
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| GROWTH | ||||||||
| GROWTH | 11 |
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| SAFETY | ||||||||
| SAFETY | 48 |
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| SENTIMENT | ||||||||
| SENTIMENT | 20 |
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| 360° VIEW | ||||||||
| 360° VIEW | 12 |
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ANALYSIS: With an Obermatt 360° View of 12 (better than 12% compared with alternatives), overall professional sentiment and financial characteristics for the stock Clearway Energy are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Clearway Energy. Only the consolidated Value Rank has an attractive rank of 66, which means that the share price of Clearway Energy is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 66% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 11, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. The consolidated Safety Rank has a riskier rank of 48, meaning the company has a riskier financing structure than 52% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, professionals are more pessimistic about the stock than for 80% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 20. ...read more
RECOMMENDATION: With a consolidated 360° View of 12, Clearway Energy is worse than 88% of all alternative stock investment opportunities based on the Obermatt Method. This means that Clearway Energy shares are on the riskier side for investors. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 66. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 11), a riskier financing structure than the competition (Safety Rank of 48), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 20) is negative. This combination is sensitive to a crisis, because high debt levels (low safety) require growth to finance the debt burden. It’s no wonder that the investor community indicators are skeptical (low sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. We recommend evaluating whether the future of Clearway Energy is as challenging as the low price of the stock suggests. Since the professional community is pessimistic, you might need to worry about the future of Clearway Energy. Only invest if you have solid reasons to believe that the low growth is temporary and the current market sentiment is an overreaction, possibly due to reputational issues in the past. ...read more
Sentiment Strategy: Professional Market Sentiment for Clearway Energy negative
ANALYSIS: With an Obermatt Sentiment Rank of 20 (better than 20% compared with alternatives), overall professional sentiment and engagement for the stock Clearway Energy is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Clearway Energy. Analyst Opinions are at a rank of 85 (better than 85% 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 21, 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 Clearway Energy. The Professional Investors rank is also low at 20, meaning that professional investors hold less stock in this company than in 80% of alternative investment opportunities. Pros tend to invest in other companies. Even worse, Market Pulse has a low rank of 17, which means that the current professional news and professional social networks are critical of this company (more negative news than for 83% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 20 (less encouraging than 80% compared with investment alternatives), Clearway Energy has a reputation among professional investors that is far 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: Clearway Energy Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 66 (better than 66% compared with alternatives), Clearway Energy shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Clearway Energy. Expected dividend yields are higher than for 92% of comparable companies (a Dividend Yield rank of 92), making the stock attractive. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 69, which means that the stock price is lower compared with invested capital than for 69% of comparable investments. But in respect to sales and profits, the picture is reversed. Price-to-Sales is 27 which means that the stock price compared with what market professionals expect for future profits is higher than for 73% of comparable companies, indicating a low value concerning Clearway Energy's sales levels. The Price-to-Profit ratio (also referred to as price-earnings (P/E) ratio) is also unfavorable for Clearway Energy with a rank of 40. This means that the stock price, compared with what market professionals expect for future profits, is higher than for 60% of comparable companies, indicating a low value concerning Clearway Energy's profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 66, is a buy recommendation based on Clearway Energy's stock price compared with the company's operational size and dividend yields. The company seems confident that it can generate a reasonable return on invested capital, because it pays an above-average dividend while profits are below what you would expect for a company with this stock price. If you agree with this practice and believe that profits will return to higher levels, as the current dividend policy suggests, Clearway Energy may be an attractive investment. If this is not the case, you may want to be careful with this stock as it is also expensive compared with its expected revenue levels. ...read more
Growth Strategy: Clearway Energy Growth Momentum negative
| GROWTH METRICS | September 21, 2023 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 47 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 4 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 60 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 17 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 11 |
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ANALYSIS: With an Obermatt Growth Rank of 11 (better than 11% compared with alternatives), Clearway Energy shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for Clearway Energy. Only Capital Growth has a good rank of 60, which means that currently professionals expect the company to grow its invested capital more than 4% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 47 which means that currently professionals expect the company to grow less than 53% of its competitors. Profit Growth with a rank of 4 and Stock Returns with a rank of 17 are also low (below 83% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 11, is a sell recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Clearway Energy is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. ...read more
Safety Strategy: Clearway Energy Debt Financing Safety below-average
| SAFETY METRICS | September 21, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 32 |
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| REFINANCING | ||||||||
| REFINANCING | 98 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 8 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 48 |
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ANALYSIS: With an Obermatt Safety Rank of 48 (better than 48% compared with alternatives), the company Clearway Energy has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Clearway Energy 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 just one indicator above average for Clearway Energy and the other two below average. Refinancing is at 98, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 98% of its competitors. But Leverage is high with a rank of 32, meaning the company has an above-average debt-to-equity ratio. It has more debt than 68% of its competitors. Liquidity is also on the riskier side with a rank of 8, meaning the company generates less profit to service its debt than 92% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 48 (worse than 52% compared with alternatives), Clearway Energy has a financing structure that is riskier than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Clearway Energy are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. ...read more
Combined financial peformance: Clearway Energy Below-Average Financial Performance
| COMBINED PERFORMANCE | September 21, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 66 |
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| GROWTH | ||||||||
| GROWTH | 11 |
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| SAFETY | ||||||||
| SAFETY | 8 |
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| COMBINED | ||||||||
| COMBINED | 28 |
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ANALYSIS: With an Obermatt Combined Rank of 28 (worse than 72% compared with investment alternatives), Clearway Energy (Renewable Electricity, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Clearway Energy are a good value (attractively priced) with a consolidated Value Rank of 66 (better than 66% of alternatives) but show below-average growth (Growth Rank of 11), and are riskily financed (Safety Rank of 48), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 28, is a hold recommendation based on Clearway Energy's financial characteristics. As the company Clearway Energy's key financial metrics exhibit good value (Obermatt Value Rank of 66) but low growth (Obermatt Growth Rank of 11) and risky financing practices (Obermatt Safety Rank of 48), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 66% of comparable companies, may indicate 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. ...read more
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