August 31, 2023
Top 10 Stock Gamuda Strong 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: Gamuda – Top 10 Stock in Water Technology
Gamuda is listed as a top 10 stock on August 31, 2023 in the market index Water Tech because of its high performance in at least one of the Obermatt investment strategies. As all consolidated Obermatt Ranks exhibit excellent performance, including positive market sentiment in the professional investor community, it is a solid stock investment where the risk of paying too much for the shares is limited. Based on the Obermatt 360° View of 98 (top 98% performer), Obermatt assesses an overall strong buy recommendation for Gamuda on August 31, 2023.
Snapshot: Obermatt Ranks
| Country | Malaysia |
| Industry | Construction & Engineering |
| Index | Good Governace Growth Markets, Independent Boards Growth Markets, Low Waste, Water Tech |
| 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° View Gamuda Strong Buy
| 360 METRICS | August 31, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 65 |
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| GROWTH | ||||||||
| GROWTH | 71 |
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| SAFETY | ||||||||
| SAFETY | 91 |
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| SENTIMENT | ||||||||
| SENTIMENT | 100 |
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| 360° VIEW | ||||||||
| 360° VIEW | 98 |
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ANALYSIS: With an Obermatt 360° View of 98 (better than 98% compared with alternatives) for 2023, overall professional sentiment and financial characteristics for the stock Gamuda are very positive. The 360° View is based on consolidating four consolidated indicators, with all four indicators above average for Gamuda. The consolidated Value Rank has an attractive rank of 65, which means that the share price of Gamuda 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 71, 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. The company is also safely financed with a Safety rank of 91. Finally, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 100. ...read more
RECOMMENDATION: With a consolidated 360° View of 98, Gamuda is better positioned than 98% of all alternative stock investment opportunities based on the Obermatt Method. As all consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 65), above-average growth (Growth Rank of 71), safe financing practices (Safety Rank of 91), and a positive market sentiment in the professional investor community (Sentiment Rank of 100), it is a solid stock investment where the risk of paying too much for the shares is limited and disappointments are less likely to occur, unless information not publicly available. High-Value Ranks sometimes indicate that the company's future is challenging. If they are safely financed and have above average growth, and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of Gamuda is as difficult as the stock’s low price, despite what good growth and safe financing practice suggest. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible, which may indicate good timing right now. ...read more
Sentiment Strategy: Professional Market Sentiment for Gamuda very positive
ANALYSIS: With an Obermatt Sentiment Rank of 100 (better than 100% compared with alternatives) for 2023, overall professional sentiment and engagement for the stock Gamuda is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all four indicators above average for Gamuda. Analyst Opinions are at a rank of 84 (better than 84% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive with a rank of 50, which means that stock research experts are changing their opinions for the better and recommending investing in the company. They are getting more optimistic about stock investments in Gamuda. The Professional Investors rank is 100, which means that currently, professional investors hold more stock in this company than in 100% of alternative investment opportunities. Pros tend to favor investing in this company. Finally, Market Pulse has a rank of 97 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 97% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 100 (more positive than 100% compared with investment alternatives), Gamuda has a reputation among professional investors that is significantly higher than that of its competitors. Since all market sentiment indicators are positive, the professional community highly recommends investment in the company. Does this mean Gamuda stocks are a safe investment? Far from it. Even professionals make mistakes. Especially in stock investing, there is a tendency to follow the leaders. Since trees don't grow to the heavens, such positive sentiment may also be interpreted as a danger sign. A lot of optimism can often be a sign of troubles to come, albeit unforeseen by most. ...read more
Value Strategy: Gamuda Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 65 (better than 65% compared with alternatives), Gamuda shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Gamuda. Price-to-Sales is 54 which means that the stock price compared with what market professionals expect for future sales is lower than for 54% of comparable companies, indicating a good value for Gamuda's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 61% 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 61. Compared with other companies in the same industry, dividend yields of Gamuda are expected to be higher than for 76% of all competitors (a Dividend Yield rank of 76). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 65, is a buy recommendation based on Gamuda'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 Gamuda based on its detailed value metrics.
Growth Strategy: Gamuda Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 71 (better than 71% compared with alternatives), Gamuda shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Gamuda. Sales Growth has a rank of 100 which means that currently professionals expect the company to grow more than 100% of its competitors. Stock Returns are also above average with a rank of 67. But Capital Growth has only a rank of 22, which means that currently professionals expect the company to grow its invested capital less than 78% of its competitors. Profit Growth is also low, with a rank of only 44, which means that, currently, professionals expect the company to grow its profits below average. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 71, is a buy recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 67% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. ...read more
Safety Strategy: Gamuda Debt Financing Safety very solid
| SAFETY METRICS | August 31, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 49 |
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| REFINANCING | ||||||||
| REFINANCING | 80 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 89 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 91 |
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ANALYSIS: With an Obermatt Safety Rank of 91 (better than 91% compared with alternatives) for 2023, the company Gamuda has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Gamuda 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 Gamuda. Refinancing is at 80, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 80% of its competitors. Liquidity is also good at 89, meaning the company generates more profit to service its debt than 89% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 49, which means the company has an above-average debt-to-equity ratio. It has more debt than 51% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 91 (better than 91% compared with alternatives), Gamuda has a financing structure that is significantly safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Gamuda could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. ...read more
Combined financial peformance: Gamuda Top Financial Performance
| COMBINED PERFORMANCE | August 31, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 65 |
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| GROWTH | ||||||||
| GROWTH | 71 |
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| SAFETY | ||||||||
| SAFETY | 89 |
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| COMBINED | ||||||||
| COMBINED | 91 |
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ANALYSIS: With an Obermatt Combined Rank of 91 (better than 91% compared with investment alternatives), Gamuda (Construction & Engineering, Malaysia) shares have much better financial characteristics than comparable stocks. Shares of Gamuda 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 71), and are safely financed (Safety Rank of 91), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 91, is a strong buy recommendation based on Gamuda's financial characteristics. As the company Gamuda's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 65), above-average growth (Obermatt Growth Rank of 71), and indicate that the company is safely financed (Obermatt Safety Rank of 91), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of Gamuda. 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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