March 21, 2024
Top 10 Stock Leonardo Buy 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: Leonardo – Top 10 Stock in Milano Italia Borsa Index MIB
Leonardo is listed as a top 10 stock on March 21, 2024 in the market index MIB because of its high performance in at least one of the Obermatt investment strategies. As three out of four consolidated Obermatt Ranks exhibit excellent performance, it is a solid investment where the risk of paying too much for the shares is low. Based on the Obermatt 360° View of 68 (high 68% performer), Obermatt assesses an overall buy recommendation for Leonardo on March 21, 2024.
Snapshot: Obermatt Ranks
| Country | Italy |
| Industry | Aerospace & Defense |
| Index | MIB, Human Rights |
| Size class | XX-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 Leonardo Buy
| 360 METRICS | March 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 65 |
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| GROWTH | ||||||||
| GROWTH | 75 |
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| SAFETY | ||||||||
| SAFETY | 29 |
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| SENTIMENT | ||||||||
| SENTIMENT | 69 |
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| 360° VIEW | ||||||||
| 360° VIEW | 68 |
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ANALYSIS: With an Obermatt 360° View of 68 (better than 68% compared with alternatives), overall professional sentiment and financial characteristics for the stock Leonardo are above average. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Leonardo. The consolidated Value Rank has an attractive rank of 65, which means that the share price of Leonardo 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 65% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 75, 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. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 69. But the company’s financing is risky with a Safety rank of 29. This means 71% of comparable companies have a safer financing structure than Leonardo. ...read more
RECOMMENDATION: With a consolidated 360° View of 68, Leonardo is better positioned than 68% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 65), above-average growth (Growth Rank of 75), and positive market sentiment in the professional investor community (Sentiment Rank of 69), it is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely, unless information not publicly available. Only the company financing structure is on the riskier side (Safety Rank of 29), but that would also mean better returns for shareholders if things work out well. Good value is sometimes an indication that the company's future is challenging. If they have been growing above average and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of Leonardo is as difficult as the low price of the stock, despite good growth and positive professional investor sentiment, suggests. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible right now, which may indicate good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for Leonardo positive
ANALYSIS: With an Obermatt Sentiment Rank of 69 (better than 69% compared with alternatives), overall professional sentiment and engagement for the stock Leonardo is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the indicators below and the other half above average for Leonardo. Analyst Opinions are at a rank of 67 (better than 67% of alternative investments). Currently, stock research analysts tend to recommend a stock investment in the company. There are also many institutional investors invested in the stock, represented by a Professional Investors rank of 99 which means that currently, professional investors hold more stock in this company than in 99% of alternative investment opportunities. But Analyst Opinions Change has a rank of 46, which means that stock research experts are changing their opinions for the worse in recommending investing in the company. In other words, they are getting more critical of investments in Leonardo. Furthermore, Market Pulse has a rank of 36, 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 64% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 69 (more positive than 69% compared with investment alternatives), Leonardo has a reputation among professional investors that is above-average compared with that of its competitors. Three below-market sentiment indicators are a sign of caution, even if the stock has significantly appreciated. If analysts change their opinions, the stock may become too expensive. If the price is on the way down, the trend may continue. This may be a stock with a good reputation and history, but it may have reached its breaking point by now. Investors should look at the Value Ranks as well. If they indicate trouble, it may be around the corner. ...read more
Value Strategy: Leonardo Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 65 (better than 65% compared with alternatives), Leonardo shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Leonardo. Price-to-Sales (P/S) is 51, which means that the stock price compared with what market professionals expect for future sales is lower than for 51% of comparable companies, indicating a good value regarding Leonardo's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 56% of alternatives, and it's also true for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 69. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 30% of all competitors have even lower dividend yields than Leonardo (a Dividend Yield Rank of 30). 70% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 65, is a buy recommendation based on Leonardo's stock price compared with the company's operational size and dividend yields. The below-average dividend yield may be a good sign, as it could mean the company has more attractive investment opportunities for the generated cash than to pay it out as dividends. A low dividend yield can also indicate a growth phase. ...read more
Growth Strategy: Leonardo Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 75 (better than 75% compared with alternatives) for 2024, Leonardo 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 Leonardo. Profit Growth has a rank of 74 which means that currently professionals expect the company to grow its profits more than 74% of its competitors. The same is valid for capital growth and stock returns. Capital Growth has a rank of 67, and Stock Returns has a rank of 97 which means that the stock returns have recently been above 97% of alternative investments. Only revenue growth is low with a Sales Growth has a rank of 25 (75% of its competitors are better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 75, is a buy recommendation for growth and momentum investors. The many positive growth indicators indicate a positive growth momentum with only low revenue growth. That can also be attributed to divestments or the sale of unprofitable businesses. If that is the reason, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: Leonardo Debt Financing Safety below-average
| SAFETY METRICS | March 21, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 57 |
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| REFINANCING | ||||||||
| REFINANCING | 13 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 48 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 29 |
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ANALYSIS: With an Obermatt Safety Rank of 29 (better than 29% compared with alternatives), the company Leonardo 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 Leonardo 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 Leonardo and the other two below average. Leverage is at a rank of 57 meaning the company has a below-average debt-to-equity ratio. It has less debt than 57% of its competitors.Refinancing is at a rank of 13, which means that the portion of the debt about to be refinanced is above-average. It has more debt in the refinancing stage than 87% of its competitors. Liquidity is at a rank of 48, meaning that the company generates less profit to service its debt than 52% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 29 (worse than 71% compared with alternatives), Leonardo has a financing structure that is riskier than that of its competitors. This is an indication that the company is on the riskier side when it comes to debt service. There is only below-market average liquidity, and a short-term refinancing issue might be around the corner. But in the long-term, the debt levels of Leonardo are on the safer side. ...read more
Combined financial peformance: Leonardo Top Financial Performance
| COMBINED PERFORMANCE | March 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 65 |
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| GROWTH | ||||||||
| GROWTH | 75 |
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| SAFETY | ||||||||
| SAFETY | 48 |
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| COMBINED | ||||||||
| COMBINED | 75 |
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ANALYSIS: With an Obermatt Combined Rank of 75 (better than 75% compared with investment alternatives), Leonardo (Aerospace & Defense, Italy) shares have much better financial characteristics than comparable stocks. Shares of Leonardo are a good value (attractively priced) with a consolidated Value Rank of 65 (better than 65% of alternatives), show above-average growth (Growth Rank of 75) but are riskily financed (Safety Rank of 29), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 75, is a strong buy recommendation based on Leonardo's financial characteristics. As the company Leonardo's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 65) and above-average growth (Obermatt Growth Rank of 75), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 29) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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