May 25, 2023
Top 10 Stock Eldorado Hold 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: Eldorado – Top 10 Stock in Copper Mining and Production
Eldorado is listed as a top 10 stock on May 25, 2023 in the market index Copper because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company is growing above average, but all other facts speak against a stock purchase, especially the low market sentiment by professional investors. Based on the Obermatt 360° View of 43 (43% performer), Obermatt assesses an overall hold recommendation for Eldorado on May 25, 2023.
Snapshot: Obermatt Ranks
| Country | Canada |
| Industry | Gold Production |
| Index | Copper, Human Rights, Gold, Zinc, Silver, Water Efficiency, TSX Composite |
| 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° Assessment Eldorado Hold
| 360 METRICS | May 25, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 42 |
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| GROWTH | ||||||||
| GROWTH | 97 |
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| SAFETY | ||||||||
| SAFETY | 40 |
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| SENTIMENT | ||||||||
| SENTIMENT | 28 |
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| 360° VIEW | ||||||||
| 360° VIEW | 43 |
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ANALYSIS: With an Obermatt 360° View of 43 (better than 43% compared with alternatives), overall professional sentiment and engagement for the stock Eldorado are below the industry average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Eldorado. The consolidated Growth Rank has a good rank of 97, 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. It ranks higher than 97% of competitors in the same industry. The other indicators are below average, namely the Value, Safety, and Sentiment Ranks.The Value Rank at 42 means that the share price of Eldorado is on the high side compared with its peer regarding revenues, profits, and invested capital. The stock price is higher than 58% of alternative stocks in the same industry. The consolidated Safety Rank has a riskier rank of 40, which means that the company has a riskier financing structure than 60% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. The consolidated Sentiment Rank also has a low rank of 28, indicating professional investors are more pessimistic about the stock than for 72% of alternative investment opportunities. ...read more
RECOMMENDATION: With a 360° View of 43, Eldorado is worse than 57% of all alternative stock investment opportunities based on the Obermatt Method. As only one of the consolidated Obermatt Ranks exhibits excellent performance, namely the above-average growth (Growth Rank of 97), it is a riskier stock investment proposition. Aside from the critical professional market sentiment (Sentiment Rank of 28), the company is rather risky when it comes to financing (Safety Rank of 40). The negative market view on Eldorado 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 join the party, they may drive stock prices above reasonable levels. While it is typical for growth companies to have low value, because investors are willing to pay more for companies that are expected to have high growth, the crucial question is: how much more do you pay for the stock of Eldorado compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one 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 (even though it is lower than 50). As market sentiment is critical, 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 Eldorado only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 28 (better than 28% compared with alternatives), overall professional sentiment and engagement for the stock Eldorado is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Eldorado. Analyst Opinions are at a rank of 11 (worse than 89% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 91, which means that stock research experts have found something to make them more positive about investing in the company. In other words, they are getting more optimistic of stock investments in Eldorado. But the Professional Investors rank is low at 37, which means that professional investors hold less stock in this company than in 63% of alternative investment opportunities. Pros tend to invest in other companies. Market Pulse is also low at a rank of 22, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 78% of competitors). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 28 (less encouraging than 72% compared with investment alternatives), Eldorado has a reputation among professional investors that is below that of its competitors. These are quite a few negative sentiment signals. One may want to trust the analysts that are changing their opinions. They may be early indications of better times, especially if the company is a smaller one. But If they are an extra large company, they should have more professional stockholders than are currently present. ...read more
Value Strategy: Eldorado Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 42 (worse than 58% compared with alternatives), Eldorado shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators where three out of four are below average for Eldorado. Only the Price-to-Book Capital ratio (also referred to as market-to-book ratio) indicates good stock value with an Price-to-Book Rank of 100, which means that the stock price is lower compared with invested capital than for 100% of comparable investments. All other value indicators are below the market median. Price-to-Sales is 49 which means the stock price compared with what market professionals expect for future profits is higher than 51% of comparable companies, indicating a low value concerning Eldorado's revenue levels. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Book Rank of 100 and for dividend yields which is lower than for 99% of comparable companies, making the stock more expensive compared with the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 42, is a HOLD recommendation based on Eldorado's stock price compared with the company's operational size and dividend yields. Why are market participants paying such a high price for Eldorado, where three out of four value indicators are below par? One reason could be that the company is well financed, indicated by the high book capital level, and has a promising future that is not yet visible in reported revenues and profits. That would also explain the low dividend yield because the company needs the cash to invest in its future. If investors can verify a picture in this sense, the stock may still be a good investment, even though current company-reported financials don't fully explain current stock prices. ...read more
Growth Strategy: Eldorado Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 97 (better than 97% compared with alternatives) for 2023, Eldorado 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 four indicators above average for Eldorado. Sales Growth has a value of 52, which means that, currently, professionals expect the company to grow more than 52% of its competitors. The same is valid for Profit Growth with a value of 96 and for Capital Growth with 73. In addition, Stock Returns had an above-average rank value of 87, which means they have been higher than 87% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 97, is a BUY recommendation for growth and momentum investors. Since all Growth Ranks are positive, Eldorado exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future, or if the current performance is only a temporary recovery from a very low point in the company's history, such as a turn-around. In the case of a turn-around situation, the current performance is a positive indicator that the company is on the right track. ...read more
Safety Strategy: Eldorado Debt Financing Safety below-average
| SAFETY METRICS | May 25, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 66 |
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| REFINANCING | ||||||||
| REFINANCING | 59 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 19 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 40 |
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ANALYSIS: With an Obermatt Safety Rank of 40 (better than 40% compared with alternatives), the company Eldorado 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 Eldorado 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 where two out of three are above average for Eldorado.Leverage is at 66, meaning the company has a below-average debt-to-equity ratio. It has less debt than 66% of its competitors.Refinancing is at a rank of 59, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 59% of its competitors. Liquidity is at 19, meaning that the company generates less profit to service its debt than 81% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 40 (worse than 60% compared with alternatives), Eldorado has a financing structure that is riskier than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. ...read more
Combined financial peformance: Eldorado Above-Average Financial Performance
| COMBINED PERFORMANCE | May 25, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 42 |
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| GROWTH | ||||||||
| GROWTH | 97 |
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| SAFETY | ||||||||
| SAFETY | 19 |
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| COMBINED | ||||||||
| COMBINED | 67 |
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ANALYSIS: With an Obermatt Combined Rank of 67 (better than 67% compared with investment alternatives), Eldorado (Gold Production, Canada) shares have above-average financial characteristics compared with similar stocks. Shares of Eldorado are low in value (priced high) with a consolidated Obermatt Value Rank of 42 (worse than 58% of alternatives), and are riskily financed (Safety Rank of 40, which means above-average debt burdens) but show above-average growth (Growth Rank of 97). ...read more
RECOMMENDATION: An Obermatt Combined Rank of 67, is a buy recommendation based on Eldorado's financial characteristics. As the company Eldorado shows low value with an Obermatt Value Rank of 42 (58% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 97% of comparable companies (Obermatt Growth Rank is 97). This is a typical case. Companies with above average growth tend to cost more than the sluggish variety. If this is a high-growth company, the low Obermatt Safety Rank of 40 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Eldorado, even a low-value company (in terms of its key financial indicators) can be a good investment. ...read more
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