October 19, 2023
Top 10 Stock Conduent 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: Conduent – Top 10 Stock in SDG 1: No Poverty
Conduent is listed as a top 10 stock on October 19, 2023 in the market index SDG 1 because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 12 (12% performer), Obermatt issues an overall sell recommendation for Conduent on October 19, 2023.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Data Processing & Outsourcing |
| Index | Employee Focus US, Human Rights, SDG 1, SDG 11, SDG 2, SDG 3, SDG 8, NASDAQ |
| Size class | X-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 Conduent Sell
| 360 METRICS | October 19, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 58 |
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| GROWTH | ||||||||
| GROWTH | 1 |
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| SAFETY | ||||||||
| SAFETY | 67 |
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| SENTIMENT | ||||||||
| SENTIMENT | 25 |
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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 Conduent are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Conduent. The consolidated Value Rank has an attractive rank of 58, which means that the share price of Conduent 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 58% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 67. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 25. Professional investors are more confident in 75% other stocks. The consolidated Growth Rank also has a low rank of 1, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 99 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 12, Conduent is worse than 88% of all alternative stock investment opportunities based on the Obermatt Method. This means that Conduent shares are on the riskier side for investors. The picture is mixed here. The stock seems to be a good value (Value Rank of 58), and the financing structure is on the safer side (Safety Rank of 67). However, sentiment in the professional investor community is below-average (Sentiment Rank of 25), as is the growth momentum for the company (Growth Rank of 1). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for Conduent only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 25 (better than 25% compared with alternatives), overall professional sentiment and engagement for the stock Conduent is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Conduent. Analyst Opinions are at a rank of 69 (better than 69% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive and has a rank of 50 which means that currently, stock research experts are getting even more optimistic about investments in Conduent. But Market Pulse has a low rank of 34, 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 66% of competitors). This is an essential sign of caution, as it could be the forebearer of bad news. Professional Investors are also somewhat absent with a rank of 19, which means that, currently, professional investors hold less stock in this company than in 81% of alternative investment opportunities. Pros tend to invest in other companies. This is expected if the company is of a smaller size (medium or smaller). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 25 (less encouraging than 75% compared with investment alternatives), Conduent has a reputation among professional investors that is below that of its competitors. While the general news feeds in the professional market are negative, the analyst recommendations are optimistic about the company, and even increase their ratings despite the negative news. This is an ambiguous situation with positive and negative signals from the professional side. Investors should be on the lookout for negative news but not worry too much about it as long as the overall news is still positive. ...read more
Value Strategy: Conduent Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 58 (better than 58% compared with alternatives), Conduent shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half above average for Conduent. Price-to-Sales (P/S) is 100, which means that the stock price compared with what market professionals expect for future sales is lower than for 100% of comparable companies, indicating a good value concerning Conduent's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio), which is more favorable than for 89% of alternatives (11% of peers have a higher ratio). But expected dividend yields with a Dividend Yield rank of 1 are lower than average (dividends are expected to be lower than 99% of other stocks) while the Price to Profit ratio (or Price to Earnings (P/E) ratio) is higher than average with a Price-to-Profit Rank of 6, 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 58, is a buy recommendation based on Conduent's stock price compared with the company's operational size and dividend yields. Low profits and low dividends as seen here for Conduent may indicate a restructuring phase. This could be transitory, making the company a good value when profits recover and dividends return to higher levels. If the stock price is compared with the size indicators for revenue and invested capital, it is on the lower side, making this stock a good value investment (apart from current profit and dividend expectations). ...read more
Growth Strategy: Conduent Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 1 (better than 1% compared with alternatives), Conduent 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 all four metrics below average for Conduent. Sales Growth has a rank of 10, which means that currently professionals expect the company to grow less than 90% of its competitors. The same is valid for Profit Growth, with a rank of 1, and Capital Growth with 1. In addition, Stock Returns have a below market rank of 41, which means that the stock returns have recently been below 59% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 1, is a sell recommendation for growth and momentum investors. These are all bad growth momentum indicators. These are negative signals for investors interested in growth companies. Value is likely good for this company, as investors may have left this stock in the cold. If that is the case, investors should look at the company's outlook, especially Sentiment performance, because it may be a turnaround situation that could entail above-average stock returns in the future. But it remains a risky bet, as no growth signals are in the green zone yet. ...read more
Safety Strategy: Conduent Debt Financing Safety above-average
| SAFETY METRICS | October 19, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 36 |
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| REFINANCING | ||||||||
| REFINANCING | 98 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 38 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 67 |
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ANALYSIS: With an Obermatt Safety Rank of 67 (better than 67% compared with alternatives), the company Conduent 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 Conduent 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 just one indicator above average for Conduent 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 36, meaning the company has an above-average debt-to-equity ratio. It has more debt than 64% of its competitors. Liquidity is also on the riskier side with a rank of 38, meaning the company generates less profit to service its debt than 62% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 67 (better than 67% compared with alternatives), Conduent has a financing structure that is safer 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 Conduent 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: Conduent Lowest Financial Performance
| COMBINED PERFORMANCE | October 19, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 58 |
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| GROWTH | ||||||||
| GROWTH | 1 |
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| SAFETY | ||||||||
| SAFETY | 38 |
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| COMBINED | ||||||||
| COMBINED | 19 |
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ANALYSIS: With an Obermatt Combined Rank of 19 (worse than 81% compared with investment alternatives), Conduent (Data Processing & Outsourcing, USA) shares have lower financial characteristics compared with similar stocks. Shares of Conduent are a good value (attractively priced) with a consolidated Value Rank of 58 (better than 58% of alternatives), are safely financed (Safety Rank of 67, which means low debt burdens), but show below-average growth (Growth Rank of 1). ...read more
RECOMMENDATION: A Combined Rank of 19, is a sell recommendation based on Conduent's financial characteristics. As the company Conduent's key financial metrics exhibit good value (Obermatt Value Rank of 58) but low growth (Obermatt Growth Rank of 1) while being safely financed (Obermatt Safety Rank of 67), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 58% of comparable companies, may also indicate that 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 and the downside is limited due to below-average financing risks. ...read more
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