August 17, 2023
Top 10 Stock IGO 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: IGO – Top 10 Stock in Lithium Mining and Production
IGO is listed as a top 10 stock on August 17, 2023 in the market index Lithium because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. While the company shows high growth, the stock price is high yet professional investor sentiment is low, which may be due to overly optimistic investor behavior, reflected in a low stock price value. Based on the Obermatt 360° View of 51 (high 51% performer), Obermatt assesses an overall buy recommendation for IGO on August 17, 2023.
Snapshot: Obermatt Ranks
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 IGO Buy
| 360 METRICS | August 17, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 36 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 67 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 61 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 41 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 51 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 51 (better than 51% compared with alternatives), overall professional sentiment and financial characteristics for the stock IGO are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for IGO. The consolidated Growth Rank has a good rank of 67, 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. This means that growth is higher than for 67% of competitors in the same industry. In addition, the consolidated Safety Rank has a safer rank of 61 which means that the company has a financing structure that is safer than 61% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the consolidated Value Rank has a less desirable rank of 36 which means that the share price of IGO is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is higher than for 64% of alternative stocks in the same industry. The consolidated Sentiment Rank also has a low rank of 41, which means that professional investors are more pessimistic about the stock than for 59% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 51, IGO is better positioned than 51% of all alternative stock investment opportunities based on the Obermatt Method. As only half of the consolidated Obermatt Ranks exhibit excellent performance, the picture is ambiguous. Growth is above-average (Growth Rank of 67), and the company is safely financed (Safety Rank of 61). However, professional market sentiment is low(Sentiment Rank of 41). The negative market view on IGO may be due to the high stock price (low value). A growth company like this may get too expensive at one point in time. If too many investors are desperate to board the train, they may drive stock prices above reasonable levels. It is typical for growth companies to have low value ratings, because investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of IGO compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one hundred minus the growth rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value if the value rank is above 60. As market sentiment is low, you should be careful with paying more than market-average for this stock and conduct further research into the company’s future growth potential. ...read more
Sentiment Strategy: Professional Market Sentiment for IGO only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 41 (better than 41% compared with alternatives), overall professional sentiment and engagement for the stock IGO is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for IGO. Analyst Opinions are at a rank of 39 (worse than 61% 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 57, which means that stock research experts are more positive in their investment recommendations in the company. In other words, they are getting more optimistic of stock investments in IGO. More encouragingly, the Professional Investors rank is 79, which means that professional investors hold more stock in this company than in 79% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 11, 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 89% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 41 (less encouraging than 59% compared with investment alternatives), IGO has a reputation among professional investors that is below that of its competitors. The sentiment signals are mixed for IGO. While analysts and the news channels are negative, there is a change in what analysts think. Above-average institutional investors in this company support them. Sentiment signals remain mixed with analysts and news channels pessimistic, though improving, and professional investors above average. ...read more
Value Strategy: IGO Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 36 (worse than 64% compared with alternatives), IGO shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for IGO. Price-to-Profit (also referred to as price-earnings, P/E) is 70 which means that the stock price compared with what market professionals expect for future profits is lower than for 70% of comparable companies, indicating a good value concerning IGO'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 12, which means that the stock price is lower as regards to invested capital than for 12% of comparable investments. On the other hand, Price-to-Sales is less favorable than 99% of alternatives (only 1% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 35% 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 36, is a hold recommendation based on IGO'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. ...read more
Growth Strategy: IGO Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 67 (better than 67% compared with alternatives), IGO 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, where half of the indicators are below and half above average for IGO. Profit Growth, with a rank of 98 (better than 98% of its competitors), and Capital Growth, with a rank of 74, are both positive, which is a healthy sign for positive development. But Sales Growth has only a rank of 17, which means that, currently, professionals expect the company to grow less than 83% of its competitors, and Stock Returns are at a rank of 47. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 67, is a buy recommendation for growth and momentum investors. Stock returns that are a thing of the past can be less of a problem. Below-average revenue growth may be caused by divestments of underperforming businesses. If that is the case, then the positive developments of profit and capital growth are signs of a company with growth potential. If these are the reasons, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: IGO Debt Financing Safety above-average
| SAFETY METRICS | August 17, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 48 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 28 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 85 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 61 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 61 (better than 61% compared with alternatives), the company IGO has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of IGO 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 just one indicator above average for IGO. Liquidity is at 85, meaning the company generates more profit to service its debt than 85% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 28, 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 72% of its competitors. Leverage is also high at a rank of 48, which means that the company has an above-average debt-to-equity ratio. It has more debt than 52% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 61 (better than 61% compared with alternatives), IGO has a financing structure that is safer than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. ...read more
Combined financial peformance: IGO Above-Average Financial Performance
| COMBINED PERFORMANCE | August 17, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 36 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 67 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 85 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 54 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 54 (better than 54% compared with investment alternatives), IGO (Diversified Metals & Mining, Australia) shares have above-average financial characteristics compared with similar stocks. Shares of IGO are low in value (priced high) with a consolidated Value Rank of 36 (worse than 64% of alternatives). But they show above-average growth (Growth Rank of 67) and are safely financed (Safety Rank of 61, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 54, is a buy recommendation based on IGO's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company IGO exhibits low value (Obermatt Value Rank of 36), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 67). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 61) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.