July 20, 2023
Top 10 Stock Financial Institutions 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: Financial Institutions – Top 10 Stock in Sound Pay Practices in the United States
financialinstitutionsinc.q4ir.com
Financial Institutions is listed as a top 10 stock on July 20, 2023 in the market index Sound Pay USA 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 42 (42% performer), Obermatt assesses an overall hold recommendation for Financial Institutions on July 20, 2023.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Regional Banks |
| Index | Dividends USA, Sound Pay USA, NASDAQ |
| Size class | Small |
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 Financial Institutions Hold
| 360 METRICS | July 20, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 100 |
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| GROWTH | ||||||||
| GROWTH | 21 |
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| SAFETY | ||||||||
| SAFETY | 55 |
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| SENTIMENT | ||||||||
| SENTIMENT | 24 |
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| 360° VIEW | ||||||||
| 360° VIEW | 42 |
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ANALYSIS: With an Obermatt 360° View of 42 (better than 42% compared with alternatives), overall professional sentiment and financial characteristics for the stock Financial Institutions are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Financial Institutions. The consolidated Value Rank has an attractive rank of 100, which means that the share price of Financial Institutions 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 100% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 55. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 24. Professional investors are more confident in 76% other stocks. The consolidated Growth Rank also has a low rank of 21, 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. 79 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 42, Financial Institutions is worse than 58% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 100), and the financing structure is on the safer side (Safety Rank of 55). However, sentiment in the professional investor community is below-average (Sentiment Rank of 24), as is the growth momentum for the company (Growth Rank of 21). 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 Financial Institutions negative
ANALYSIS: With an Obermatt Sentiment Rank of 24 (better than 24% compared with alternatives), overall professional sentiment and engagement for the stock Financial Institutions is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half the indicators below and half above average for Financial Institutions. Analyst Opinions are at a rank of 41 (worse than 59% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 5, which means that stock research experts are getting even more pessimistic. In addition, the Professional Investors rank is 16, which means that professional investors hold less stock in this company than in 84% of alternative investment opportunities. Pros tend to invest in other companies. The only positive sentiment indicator for Financial Institutions is Market Pulse, with a rank of 53, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 53% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 24 (less encouraging than 76% compared with investment alternatives), Financial Institutions has a reputation among professional investors that is far below that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: Financial Institutions Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 100 (better than 100% compared with alternatives) for 2023, Financial Institutions shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Financial Institutions. Price-to-Sales is 93 which means that the stock price compared with what market professionals expect for future sales is lower than for 93% of comparable companies, indicating a good value for Financial Institutions's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 95% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 91. Compared with other companies in the same industry, dividend yields of Financial Institutions are expected to be higher than for 100% of all competitors (a Dividend Yield rank of 100). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 100, is a buy recommendation based on Financial Institutions's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in Financial Institutions based on its detailed value metrics.
Growth Strategy: Financial Institutions Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 21 (better than 21% compared with alternatives), Financial Institutions 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 Financial Institutions. While Sales Growth ranks at 76, professionals currently expect the company to grow more than 76% of its competitors, while all other growth ranks are below the market median. Profit Growth has a rank of 48, which means that, currently, professionals expect the company to grow its profits less than 52% of its competitors, and Capital Growth has a low rank of 9. Historic stock returns were also below average with a current Stock Returns rank of 11 which means that the stock returns have recently been below 89% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 21, is a sell recommendation for growth and momentum investors. If revenues are expected to increase, but all other growth indicators are negative, the company may be investing in future growth through means not visible in the balance sheet and thus not reflected in capital growth. The fact that Stock Returns have been below market doesn't mean that much, as it may be due to overly optimistic investor behavior in the past, which has been corrected to a more reasonable level recently. If that were the case, a positive Value Rank would be a reason to invest because the company is still expected to grow, while stock prices are now at a more reasonable level. ...read more
Safety Strategy: Financial Institutions Debt Financing Safety above-average
| SAFETY METRICS | July 20, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 80 |
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| REFINANCING | ||||||||
| REFINANCING | 65 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 6 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 55 |
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ANALYSIS: With an Obermatt Safety Rank of 55 (better than 55% compared with alternatives), the company Financial Institutions 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 Financial Institutions 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 where two out of three are above average for Financial Institutions.Leverage is at 80, meaning the company has a below-average debt-to-equity ratio. It has less debt than 80% of its competitors.Refinancing is at a rank of 65, 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 65% of its competitors. Liquidity is at 6, meaning that the company generates less profit to service its debt than 94% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 55 (better than 55% compared with alternatives), Financial Institutions has a financing structure that is safer 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: Financial Institutions Above-Average Financial Performance
| COMBINED PERFORMANCE | July 20, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 100 |
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| GROWTH | ||||||||
| GROWTH | 21 |
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| SAFETY | ||||||||
| SAFETY | 6 |
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| COMBINED | ||||||||
| COMBINED | 65 |
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ANALYSIS: With an Obermatt Combined Rank of 65 (better than 65% compared with investment alternatives), Financial Institutions (Regional Banks, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Financial Institutions are a good value (attractively priced) with a consolidated Value Rank of 100 (better than 100% of alternatives), are safely financed (Safety Rank of 55, which means low debt burdens), but show below-average growth (Growth Rank of 21). ...read more
RECOMMENDATION: A Combined Rank of 65, is a buy recommendation based on Financial Institutions's financial characteristics. As the company Financial Institutions's key financial metrics exhibit good value (Obermatt Value Rank of 100) but low growth (Obermatt Growth Rank of 21) while being safely financed (Obermatt Safety Rank of 55), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 100% 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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