Fact based stock research
Fortum (HLSE:FORTUM)

FI0009007132

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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.

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Fortum stock research in summary

fortum.fi


ANALYSIS: With an Obermatt Combined Rank of 65 (better than 65% compared with investment alternatives), Fortum (Electric Utilities, Finland) shares have above-average financial characteristics compared with similar stocks. Shares of Fortum are a good value (attractively priced) with a consolidated Value Rank of 56 (better than 56% of alternatives), are safely financed (Safety Rank of 88, which means low debt burdens), but show below-average growth (Growth Rank of 31). ...read more


RECOMMENDATION: A Combined Rank of 65, is a buy recommendation based on Fortum's financial characteristics. As the company Fortum's key financial metrics exhibit good value (Obermatt Value Rank of 56) but low growth (Obermatt Growth Rank of 31) while being safely financed (Obermatt Safety Rank of 88), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 56% 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. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more


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Country Finland
Industry Electric Utilities
Index OMX 25, Low Emissions, Dividends Europe, Nuclear
Size class X-Large

This stock has achievements: Insight 2018-06-28, Top 10 Stock.

23-May-2024. Stock data may be delayed. Log in or sign up to get the most recent research.




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Research History: Fortum

RESEARCH HISTORY 2021 2022 2023 2024
VALUE
VALUE
GROWTH
GROWTH
SAFETY
SAFETY
SENTIMENT
SENTIMENT
360° VIEW
360° VIEW

Most recent update of the stock research: 23-May-2024. Financial reporting date used for calculating ranks: 31-Dec-2023. Stock research history is based on the Obermatt Method. The higher the rank, the better Fortum is in the corresponding investment strategy.
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Combined financial peformance in Detail

ANALYSIS: With an Obermatt Combined Rank of 65 (better than 65% compared with investment alternatives), Fortum (Electric Utilities, Finland) shares have above-average financial characteristics compared with similar stocks. Shares of Fortum are a good value (attractively priced) with a consolidated Value Rank of 56 (better than 56% of alternatives), are safely financed (Safety Rank of 88, which means low debt burdens), but show below-average growth (Growth Rank of 31). ...read more

RECOMMENDATION: A Combined Rank of 65, is a buy recommendation based on Fortum's financial characteristics. As the company Fortum's key financial metrics exhibit good value (Obermatt Value Rank of 56) but low growth (Obermatt Growth Rank of 31) while being safely financed (Obermatt Safety Rank of 88), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 56% 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. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

RESEARCH HISTORY 2021 2022 2023 2024
VALUE
VALUE
GROWTH
GROWTH
SAFETY
SAFETY
COMBINED
COMBINED

Last update of combined financial performance: 23-May-2024. Stock analysis on combined financial performance: The higher the rank of Fortum the better the performance.


Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 56 (better than 56% compared with alternatives), Fortum shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Fortum. Price-to-Profit (also referred to as price-earnings, P/E) is 55 which means that the stock price compared with what market professionals expect for future profits is lower than for 55% of comparable companies, indicating a good value concerning Fortum's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 39, which means that the stock price is lower as regards to invested capital than for 39% of comparable investments. On the other hand, Price-to-Sales is less favorable than 69% of alternatives (only 31% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 14% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 56, is a buy recommendation based on Fortum's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more


VALUE METRICS 2021 2022 2023 2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)
DIVIDEND YIELD
DIVIDEND YIELD
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE

Last update of Value Rank: 23-May-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Fortum; except for dividend yield where the rank is higher, the higher the yield.


Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 31 (better than 31% compared with alternatives), Fortum shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for Fortum. Sales Growth has a below market rank of 12, which means that, currently, professionals expect the company to grow less than 88% of its competitors. The same is valid for Capital Growth, with a rank of 41, and Profit Growth, with a rank of 42. Currently, professionals expect the company to grow its profits less than 58% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 88, which means that the stock returns have recently been above 88% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 31, is a hold recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for Fortum, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with recent above-market stock returns. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive stock returns are not yet a sign of recovery. Investors should look closely at the Value and Sentiment indicators before they make a stock purchasing decision, because growth is unlikely to be the driving argument behind this investment. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is low here. ...read more

GROWTH METRICS 2021 2022 2023 2024
REVENUE GROWTH
REVENUE GROWTH
PROFIT GROWTH
PROFIT GROWTH
CAPITAL GROWTH
CAPITAL GROWTH
STOCK RETURNS
STOCK RETURNS
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH

Last update of Growth Rank: 23-May-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Fortum.


Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 88 (better than 88% compared with alternatives) for 2024, the company Fortum has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Fortum 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 all three are above average for Fortum. Leverage is at 75, meaning the company has a below-average debt-to-equity ratio. It has less debt than 75% of its competitors. Refinancing is at a rank of 84, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 84% of its competitors. Finally, Liquidity is also good at a rank of 68, which means that the company generates more profit to service its debt than 68% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 88 (better than 88% compared with alternatives), Fortum has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. Investors may not have a debt issue with Fortum but they should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS 2021 2022 2023 2024
LEVERAGE
LEVERAGE
REFINANCING
REFINANCING
LIQUIDITY
LIQUIDITY
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY

Last update of Safety Rank: 23-May-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Fortum and the more cash is available to service its debt.


Sentiment Metrics in Detail

SENTIMENT 2021 2022 2023 2024
ANALYST OPINIONS
ANALYST OPINIONS
OPINIONS CHANGE
OPINIONS CHANGE
PRO HOLDINGS
PRO HOLDINGS
MARKET PULSE
MARKET PULSE
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT

Last update of Sentiment Rank: 23-May-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Fortum.
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Free stock analysis by the purely fact based Obermatt Method for Fortum from May 23, 2024.

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