May 25, 2023
Top 10 Stock Harmony 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: Harmony – Top 10 Stock in Copper Mining and Production
Harmony 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 half the consolidated Obermatt Ranks are above-average, investor sentiment is below average and thus a signal for caution. Based on the Obermatt 360° View of 55 (high 55% performer), Obermatt assesses an overall buy recommendation for Harmony on May 25, 2023.
Snapshot: Obermatt Ranks
| Country | South Africa |
| Industry | Gold Production |
| Index | Copper, Energy Efficient, Human Rights, Gold, Silver, Uranium, Water Efficiency, JSE All Shares |
| 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° Assessment Harmony Buy
| 360 METRICS | May 25, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 53 |
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| GROWTH | ||||||||
| GROWTH | 97 |
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| SAFETY | ||||||||
| SAFETY | 43 |
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| SENTIMENT | ||||||||
| SENTIMENT | 21 |
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| 360° VIEW | ||||||||
| 360° VIEW | 55 |
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ANALYSIS: With an Obermatt 360° View of 55 (better than 55% compared with alternatives), overall professional sentiment and engagement for the stock Harmony are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Harmony. The consolidated Value Rank has an attractive rank of 53, which means that the share price of Harmony is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 53% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 97, 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. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 21. Professional investors are more confident in 79% other stocks. Worryingly, the company has risky financing, with a Safety rank of 43. This means 57% of comparable companies have a safer financing structure than Harmony. ...read more
RECOMMENDATION: With a 360° View of 55, Harmony is better than 55% of all alternative stock investment opportunities based on the Obermatt Method. Even though half of the consolidated Obermatt Ranks are above-average, namely the Value Rank at 53 and the Growth Rank above-average at 97, the picture is still mixed. The professional investor community is skeptical, with the Sentiment Rank below-average at 21. In addition, the company financing structure is on the riskier side (Safety Rank of 43). While everybody wants to buy at low stock prices (good value), there may be a good reason why Harmony's share price is low, namely because professionals are skeptical. One may be tempted by above-average growth, but that could also change quickly, as past performance is not a good indicator of future performance. Since the financing structure is on the risky side, investors should 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 Harmony negative
ANALYSIS: With an Obermatt Sentiment Rank of 21 (better than 21% compared with alternatives), overall professional sentiment and engagement for the stock Harmony is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Harmony. Analyst Opinions are at a rank of 5 (worse than 95% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 87, which means that stock research experts have found something to make them more positive about investing in the company. In other words, they are getting more optimistic of stock investments in Harmony. But the Professional Investors rank is low at 32, which means that professional investors hold less stock in this company than in 68% of alternative investment opportunities. Pros tend to invest in other companies. Market Pulse is also low at a rank of 20, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 80% of competitors). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 21 (less encouraging than 79% compared with investment alternatives), Harmony has a reputation among professional investors that is far below that of its competitors. These are quite a few negative sentiment signals. One may want to trust the analysts that are changing their opinions. They may be early indications of better times, especially if the company is a smaller one. But If they are an extra large company, they should have more professional stockholders than are currently present. ...read more
Value Strategy: Harmony Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 53 (better than 53% compared with alternatives), Harmony 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 Harmony. Price-to-Sales (P/S) is 62, which means that the stock price compared with what market professionals expect for future sales is lower than for 62% of comparable companies, indicating a good value regarding Harmony's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 70% 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 57. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 44% of all competitors have even lower dividend yields than Harmony (an Dividend Yield Rank of 44). 56% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 53, is a BUY recommendation based on Harmony'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: Harmony Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 97 (better than 97% compared with alternatives) for 2023, Harmony 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 four indicators above average for Harmony. Sales Growth has a value of 80, which means that, currently, professionals expect the company to grow more than 80% of its competitors. The same is valid for Profit Growth with a value of 87 and for Capital Growth with 64. In addition, Stock Returns had an above-average rank value of 97, which means they have been higher than 97% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 97, is a BUY recommendation for growth and momentum investors. Since all Growth Ranks are positive, Harmony exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future, or if the current performance is only a temporary recovery from a very low point in the company's history, such as a turn-around. In the case of a turn-around situation, the current performance is a positive indicator that the company is on the right track. ...read more
Safety Strategy: Harmony Debt Financing Safety below-average
| SAFETY METRICS | May 25, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 66 |
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| REFINANCING | ||||||||
| REFINANCING | 17 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 57 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 43 |
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ANALYSIS: With an Obermatt Safety Rank of 43 (better than 43% compared with alternatives), the company Harmony 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 Harmony 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 two out of three indicators above average for Harmony. Leverage is at a rank of 66, meaning the company has a below-average debt-to-equity ratio. It has less debt than 66% of its competitors. Liquidity is also good at a rank of 57, meaning the company generates more profit to service its debt than 57% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 17, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 83% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 43 (worse than 57% compared with alternatives), Harmony has a financing structure that is riskier than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Harmony. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. ...read more
Combined financial peformance: Harmony Top Financial Performance
| COMBINED PERFORMANCE | May 25, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 53 |
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| GROWTH | ||||||||
| GROWTH | 97 |
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| SAFETY | ||||||||
| SAFETY | 57 |
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| COMBINED | ||||||||
| COMBINED | 77 |
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ANALYSIS: With an Obermatt Combined Rank of 77 (better than 77% compared with investment alternatives), Harmony (Gold Production, South Africa) shares have much better financial characteristics than comparable stocks. Shares of Harmony are a good value (attractively priced) with a consolidated Obermatt Value Rank of 53 (better than 53% of alternatives), show above-average growth (Growth Rank of 97) but are riskily financed (Safety Rank of 43), which means above-average debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 77, is a strong buy recommendation based on Harmony's financial characteristics. As the company Harmony's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 53) and above-average growth (Obermatt Growth Rank of 97), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 43) 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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