May 25, 2023
Top 10 Stock Glencore 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: Glencore – Top 10 Stock in Copper Mining and Production
Glencore 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. While only half of the consolidated Obermatt Ranks exhibit above-average performance and professional market sentiment is positive, it may be a solid investment proposition, especially if a growth recovery is to be expected soon. Based on the Obermatt 360° View of 51 (high 51% performer), Obermatt assesses an overall buy recommendation for Glencore on May 25, 2023.
Snapshot: Obermatt Ranks
| Country | Switzerland |
| Industry | Diversified Metals & Mining |
| Index | FTSE All Shares, FTSE 100, FTSE 350, Low Emissions, Copper, Dividends Europe, Human Rights, Iron, Low Waste, Zinc, Recycling, Water Efficiency |
| 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° Assessment Glencore Buy
| 360 METRICS | May 25, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 83 |
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| GROWTH | ||||||||
| GROWTH | 33 |
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| SAFETY | ||||||||
| SAFETY | 19 |
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| SENTIMENT | ||||||||
| SENTIMENT | 63 |
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| 360° VIEW | ||||||||
| 360° VIEW | 51 |
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ANALYSIS: With an Obermatt 360° View of 51 (better than 51% compared with alternatives), overall professional sentiment and engagement for the stock Glencore are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Glencore. The consolidated Value Rank has an attractive rank of 83, which means that the share price of Glencore is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 83% of alternative stocks in the same industry. The consolidated Sentiment Rank has a good rank of 63, which means that professional investors are more optimistic about the stock than for 63% of alternative investment opportunities. But the consolidated Growth Rank has a low rank of 33, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. The consolidated Safety Rank has a riskier rank of 19, meaning the company has a riskier financing structure than 81 comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. ...read more
RECOMMENDATION: With a 360° View of 51, Glencore is better than 51% of all alternative stock investment opportunities based on the Obermatt Method. Half of the consolidated Obermatt Ranks exhibit above-average performance, but the other half are below market levels. The company enjoys a good value (Value Rank of 83) and positive market sentiment in the professional investor community (Sentiment Rank of 63), but growth expectations are below-average (Growth Rank of 33) and the financing structure is on the risky side(Safety Rank of 19). This combination is rather dangerous, because high debt levels (low safety) require growth to finance the debt burden. The current low growth level may be temporary, because professionals are actually optimistic (high sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. Companies with less growth typically have a lower price than fast-growing competitors. Even though professional investor sentiment is strong, we recommend further evaluating whether the future of Glencore is as challenging as the stock's low price suggests. Since the professional community is optimistic, the stock might just be going through a more challenging phase now, indicating that timing might be good now. ...read more
Sentiment Strategy: Professional Market Sentiment for Glencore positive
ANALYSIS: With an Obermatt Sentiment Rank of 63 (better than 63% compared with alternatives), overall professional sentiment and engagement for the stock Glencore is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Glencore. Analyst Opinions are at a rank of 95 (better than 95% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. In addition, Analyst Opinions Change has a rank of 50, which means that stock research experts are changing their opinions for the better in recommending investing in the company. In other words, they are getting even more optimistic about investments in Glencore. Finally, the Professional Investors rank is 67, which means that currently, professional investors hold more stock in this company than in 67% of alternative investment opportunities. ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 63 (more positive than 63% compared with investment alternatives), Glencore has a reputation among professional investors that is above-average compared with that of its competitors. Pros tend to favor investing in this company. But there is also a signal for caution. Market Pulse has a rank of 15, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 85% of competitors). This could mean future risks and should make investors careful. Attention to negative news for Glencore is worthwhile because they may be early warning signals. Without those, all other professional signals are encouraging, especially since analysts are getting more optimistic. ...read more
Value Strategy: Glencore Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 83 (better than 83% compared with alternatives) for 2023, Glencore shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Glencore. Price-to-Sales (P/S) is 89, which means that the stock price compared with what market professionals expect for future sales is lower than for 89% of comparable companies, indicating a good value concerning Glencore's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 68% of alternatives. Finally, it is true for expected dividend yields with an Dividend Yield rank of 99 (dividends are expected to be higher than 99% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 56% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Glencore to 44. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 83, is a strong buy recommendation based on Glencore's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner in assets than its competitors. For instance, the company could be leasing its production facilities or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the three good value ranks for Sales, Profits, and Dividends are reliable indicators for the stock price value. ...read more
Growth Strategy: Glencore Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 33 (better than 33% compared with alternatives), Glencore 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 Glencore. Sales Growth has a below market rank of 19, which means that, currently, professionals expect the company to grow less than 81% of its competitors. The same is valid for Capital Growth, with a rank of 44, and Profit Growth, with a rank of 26. Currently, professionals expect the company to grow its profits less than 74% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 67, which means that the stock returns have recently been above 67% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 33, 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 Glencore, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with an above-market return. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive shareholder 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. ...read more
Safety Strategy: Glencore Debt Financing Safety risky
| SAFETY METRICS | May 25, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 26 |
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| REFINANCING | ||||||||
| REFINANCING | 45 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 40 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 19 |
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ANALYSIS: With an Obermatt Safety Rank of 19 (better than 19% compared with alternatives), the company Glencore has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Glencore 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 all three metrics below average for Glencore. Liquidity is at 40, meaning that the company generates less profit to service its debt than 60% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 26, meaning the company has an above-average debt-to-equity ratio. It has more debt than 74% of its competitors. Finally, Refinancing is at a rank of 45 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 55% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 19 (worse than 81% compared with alternatives), Glencore has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing. ...read more
Combined financial peformance: Glencore Below-Average Financial Performance
| COMBINED PERFORMANCE | May 25, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 83 |
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| GROWTH | ||||||||
| GROWTH | 33 |
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| SAFETY | ||||||||
| SAFETY | 40 |
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| COMBINED | ||||||||
| COMBINED | 37 |
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ANALYSIS: With an Obermatt Combined Rank of 37 (worse than 63% compared with investment alternatives), Glencore (Diversified Metals & Mining, Switzerland) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Glencore are a good value (attractively priced) with a consolidated Obermatt Value Rank of 83 (better than 83% of alternatives) but show below-average growth (Growth Rank of 33), and are riskily financed (Safety Rank of 19), which means above-average debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 37, is a hold recommendation based on Glencore's financial characteristics. As the company Glencore's key financial metrics exhibit good value (Obermatt Value Rank of 83) but low growth (Obermatt Growth Rank of 33) and risky financing practices (Obermatt Safety Rank of 19), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 83% of comparable companies, may indicate 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. ...read more
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