February 1, 2024
Top 10 Stock Daiichi Sankyo Strong Buy Recommendation

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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 Daiichi Sankyo Strong Buy

360 METRICS	February 1, 2024
VALUE
VALUE	12
GROWTH
GROWTH	95
SAFETY
SAFETY	61
SENTIMENT
SENTIMENT	86
360° VIEW
360° VIEW	81

ANALYSIS: With an Obermatt 360° View of 81 (better than 81% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock Daiichi Sankyo are very positive. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Daiichi Sankyo. 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. The consolidated Safety Rank at 61 means that the company has a financing structure that is safer than 61% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a good rank of 86, which means that professional investors are more optimistic about the stock than for 86% of alternative investment opportunities. But the consolidated Value Rank is less desirable at 12, meaning that the share price of Daiichi Sankyo is on the higher side compared with indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 88% of alternative stocks in the same industry. ...read more

RECOMMENDATION: With a consolidated 360° View of 81, Daiichi Sankyo is better positioned than 81% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as above-average growth (Growth Rank of 95), a safe financing structure (Safety Rank of 61), and positive professional market sentiment (Sentiment Rank of 86), it is a solid stock investment where growth may be the strongest driver of the investment rationale, also reflected by institutional investors. It is typical for growth companies to have low value, as is the case here. 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 Daiichi Sankyo compared with alternatives? You can use the following rule of thumb: The growth rank measures the growth momentum of the company (95% better than peers). The value rank could be the reverse reflection of that (5%). A Value Rank below that level may be assessed as expensive, a rank above that is still good value. Sometimes market sentiment just reflects the past, sometimes the reality. You pay more than the market average for this stock, but it may be worth it. ...read more

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Sentiment Strategy: Professional Market Sentiment for Daiichi Sankyo very positive

SENTIMENT METRICS	February 1, 2024
ANALYST OPINION
ANALYST OPINION	78
OPINIONS CHANGE
OPINIONS CHANGE	92
PRO HOLDINGS
PRO HOLDINGS	82
MARKET PULSE
MARKET PULSE	7
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	86

ANALYSIS: With an Obermatt Sentiment Rank of 86 (better than 86% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Daiichi Sankyo is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Daiichi Sankyo. Analyst Opinions are at a rank of 78 (better than 78% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. In addition, Analyst Opinions Change has a rank of 92, which means that stock research experts are changing their opinions for the better in recommending investing in the company. In other words, they are getting even more optimistic about investments in Daiichi Sankyo. Finally, the Professional Investors rank is 82, which means that currently, professional investors hold more stock in this company than in 82% of alternative investment opportunities. ...read more

RECOMMENDATION: With a consolidated Sentiment Rank of 86 (more positive than 86% compared with investment alternatives), Daiichi Sankyo has a reputation among professional investors that is significantly higher than that of its competitors. Pros tend to favor investing in this company. But there is also a signal for caution. Market Pulse has a rank of 7, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 93% of competitors). This could mean future risks and should make investors careful. Attention to negative news for Daiichi Sankyo is worthwhile because they may be early warning signals. Without those, all other professional signals are encouraging, especially since analysts are getting more optimistic. ...read more

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Value Strategy: Daiichi Sankyo Stock Price Value low

VALUE METRICS	February 1, 2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	19
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	14
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	18
DIVIDEND YIELD
DIVIDEND YIELD	38
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	12

ANALYSIS: With an Obermatt Value Rank of 12 (worse than 88% compared with alternatives), Daiichi Sankyo shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Daiichi Sankyo. Price-to-Sales is 19 which means that the stock price compared with what market professionals expect for future profits is higher than 81% of comparable companies, indicating a low value concerning Daiichi Sankyo's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 18, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Daiichi Sankyo. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 14 and Dividend Yield, which is lower than 62% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 12, is a sell recommendation based on Daiichi Sankyo's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Daiichi Sankyo? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Daiichi Sankyo? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Daiichi Sankyo may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. ...read more

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Growth Strategy: Daiichi Sankyo Growth Momentum high

GROWTH METRICS	February 1, 2024
REVENUE GROWTH
REVENUE GROWTH	82
PROFIT GROWTH
PROFIT GROWTH	65
CAPITAL GROWTH
CAPITAL GROWTH	100
STOCK RETURNS
STOCK RETURNS	49
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	95

ANALYSIS: With an Obermatt Growth Rank of 95 (better than 95% compared with alternatives) for 2024, Daiichi Sankyo 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 Daiichi Sankyo. Sales Growth has a value of 82 which means that currently professionals expect the company to grow more than 82% of its competitors. Profit Growth with a value of 65 and Capital Growth with a rank of 100 means that currently, professionals expect the company to grow both profits and invested capital more than of its competitors. But Stock Returns has only a rank of 49, which means that stock returns have recently been below 51% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 95, is a buy recommendation for growth and momentum investors. Daiichi Sankyo has only one below-average growth indicator, the stock returns. This is probably the least reliable growth indicator, because it measures company and investor expectations at the same time. The three other growth indicators, which are all positive for Daiichi Sankyo, are more reliable measures of growth momentum. For this reason, the company seems to be on a good trajectory, unless you think the current period is not representative, because of unique events that will not be repeated in the future. ...read more

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Safety Strategy: Daiichi Sankyo Debt Financing Safety above-average

SAFETY METRICS	February 1, 2024
LEVERAGE
LEVERAGE	59
REFINANCING
REFINANCING	35
LIQUIDITY
LIQUIDITY	70
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	61

ANALYSIS: With an Obermatt Safety Rank of 61 (better than 61% compared with alternatives), the company Daiichi Sankyo 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 Daiichi Sankyo 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 Daiichi Sankyo. Leverage is at a rank of 59, meaning the company has a below-average debt-to-equity ratio. It has less debt than 59% of its competitors. Liquidity is also good at a rank of 70, meaning the company generates more profit to service its debt than 70% 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 35, 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 65% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 61 (better than 61% compared with alternatives), Daiichi Sankyo 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 Daiichi Sankyo. 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

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Combined financial peformance: Daiichi Sankyo Above-Average Financial Performance

COMBINED PERFORMANCE	February 1, 2024
VALUE
VALUE	12
GROWTH
GROWTH	95
SAFETY
SAFETY	70
COMBINED
COMBINED	60

ANALYSIS: With an Obermatt Combined Rank of 60 (better than 60% compared with investment alternatives), Daiichi Sankyo (Pharmaceuticals, Japan) shares have above-average financial characteristics compared with similar stocks. Shares of Daiichi Sankyo are low in value (priced high) with a consolidated Value Rank of 12 (worse than 88% of alternatives). But they show above-average growth (Growth Rank of 95) and are safely financed (Safety Rank of 61, which means below-average debt burdens). ...read more

RECOMMENDATION: A Combined Rank of 60, is a buy recommendation based on Daiichi Sankyo's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Daiichi Sankyo exhibits low value (Obermatt Value Rank of 12), 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 61) 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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