January 11, 2024
Top 10 Stock ING 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: ING – Top 10 Stock in Belgian 20 Index BEL20
ING is listed as a top 10 stock on January 11, 2024 in the market index BEL20 because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. The company is safely financed and the professional investor sentiment is positive. Both are encouraging signals for a stock purchase decision, albeit at an above-average share price. Based on the Obermatt 360° View of 59 (high 59% performer), Obermatt assesses an overall buy recommendation for ING on January 11, 2024.
Snapshot: Obermatt Ranks
| Country | Netherlands |
| Industry | Diversified Banks |
| Index | AEX, BEL20, EURO STOXX 50, Human Rights, Renewables Users, SDG 10, SDG 12, SDG 13, SDG 8 |
| 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° View ING Buy
| 360 METRICS | January 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 49 |
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| GROWTH | ||||||||
| GROWTH | 35 |
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| SAFETY | ||||||||
| SAFETY | 57 |
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| SENTIMENT | ||||||||
| SENTIMENT | 71 |
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| 360° VIEW | ||||||||
| 360° VIEW | 59 |
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ANALYSIS: With an Obermatt 360° View of 59 (better than 59% compared with alternatives), overall professional sentiment and financial characteristics for the stock ING are above average. The 360° View is based on consolidating four consolidated indicators, with half below and half above average for ING. The consolidated Sentiment Rank has a good rank of 71, which means that professional investors are more optimistic about the stock than for 71% of alternative investment opportunities. It also rates well regarding its financing structure, with the consolidated Safety Rank at 57 or better than 57% of its peers when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the stock is expensive and expects low growth. The consolidated Value Rank is only 49, meaning that the share price of ING is on the high side, compared with indicators such as revenues, profits, and invested capital. The company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth,and stock returns, with its Growth Rank at 35. ...read more
RECOMMENDATION: With a consolidated 360° View of 59, ING is better positioned than 59% of all alternative stock investment opportunities based on the Obermatt Method. As only half of the consolidated Obermatt Ranks exhibit excellent performance, namely the positive professional market sentiment (Sentiment Rank of 71) and safe financing practices (Safety Rank of 57), the case for investing in this stock needs further thought. The Value and the Safety Ranks are below average. The Safety Rank is the least critical of the four consolidated ranks, because it only reflects financing practices. So the question is: How to assess below-average value against above-average sentiment? This may be a case where growth is in the future, not yet reflected in current performance. Companies that might fall into this category are those with intellectual property, such as technology and pharmaceutical companies. In early phases, they are expensive relative to their size and have a lot of capital on their books, as is the case here. Investors expect a better future and are willing to pay a higher price than is warranted by the current company size. These higher prices drive stock price value down in the short term. In this case, future growth may be the strongest driver of the investment case, reflected by institutional investors' opinions. With a weak Value Rank, the question is how much to sacrifice value at the cost of positive sentiment. Sometimes market sentiment is just hype, but sometimes it is right. You pay more than market-average for this stock, but it may be worth it, if the future of ING̣ is bright. Prudent investors may only want to invest a smaller portion of their wealth in such situations. Young investors can carry more risk but should still thrive for sufficient diversification. ...read more
Sentiment Strategy: Professional Market Sentiment for ING positive
ANALYSIS: With an Obermatt Sentiment Rank of 71 (better than 71% compared with alternatives), overall professional sentiment and engagement for the stock ING is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for ING. Analyst Opinions are at a rank of 51 (better than 51% 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 76, which means that currently, stock research experts are getting even more optimistic. Obermatt Market Pulse further supports this with a rank of 90, which means that the current professional news and professional social networks are generally positive when discussing this company (more positive news than for 90% of competitors). But there are few stock holdings by institutional investors. The Professional Investors rank is low at 31, which means that currently, professional investors hold less stock in this company than in 69% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 71 (more positive than 71% compared with investment alternatives), ING has a reputation among professional investors that is above-average compared with that of its competitors. Not having too many professionals invested in ING may be less of an issue, especially if the stock is from a smaller company where professionals typically invest less. It is natural for professional investors to focus on large and extra-large companies, as they provide more safety. Smaller companies attract fewer professionals in the shareholder community. Overall, the signals from the professionals are still quite favorable for investments in ING. ...read more
Value Strategy: ING Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 49 (worse than 51% compared with alternatives), ING shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators that are all above average for ING. Price-to-Sales is 55 which means that the stock price compared with what market professionals expect for future sales is lower than for 55% of comparable companies, indicating a good value for ING's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 50% 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 51. Compared with other companies in the same industry, dividend yields of ING are expected to be higher than for 67% of all competitors (a Dividend Yield rank of 67). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 49, is a hold recommendation based on ING'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 ING based on its detailed value metrics.
Growth Strategy: ING Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 35 (better than 35% compared with alternatives), ING 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 metrics below average for ING. While Profit Growth has a good rank of 76, as professionals currently expect the company to grow its profits more than 76% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 46, which means that currently professionals expect the company to grow less than 54% of its competitors, while Capital Growth has a rank of 23 and Stock Returns have been below market median, with a rank of 35 (65% of alternative investments were better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 35, is a hold recommendation for growth and momentum investors. While revenue growth and capital growth are good growth momentum indicators, profit is less reliable, because profits may increase due to cost-cutting measures which typically indicate negative growth momentum. "You can save a dollar only once" is the saying about such situations. Growth Investors should look at company priorities closely if they are interested in growth, because the increase in profits is not usually an indicator of growth, and stock prices have been below market, too. ...read more
Safety Strategy: ING Debt Financing Safety above-average
| SAFETY METRICS | January 11, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 28 |
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| REFINANCING | ||||||||
| REFINANCING | 74 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 55 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 57 |
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ANALYSIS: With an Obermatt Safety Rank of 57 (better than 57% compared with alternatives), the company ING 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 ING 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 ING. Refinancing is at 74, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 74% of its competitors. Liquidity is also good at 55, meaning the company generates more profit to service its debt than 55% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 28, which means the company has an above-average debt-to-equity ratio. It has more debt than 72% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 57 (better than 57% compared with alternatives), ING has a financing structure that is 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 ING 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: ING Below-Average Financial Performance
| COMBINED PERFORMANCE | January 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 49 |
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| GROWTH | ||||||||
| GROWTH | 35 |
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| SAFETY | ||||||||
| SAFETY | 55 |
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| COMBINED | ||||||||
| COMBINED | 45 |
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ANALYSIS: With an Obermatt Combined Rank of 45 (worse than 55% compared with investment alternatives), ING (Diversified Banks, Netherlands) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of ING are low in value (priced high) with a consolidated Value Rank of 49 (worse than 51% of alternatives) and show below-average growth (Growth Rank of 35) but are safely financed (Safety Rank of 57), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 45, is a hold recommendation based on ING's financial characteristics. As the company ING's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 49) and low growth (Obermatt Growth Rank of 35), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 57) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. ...read more
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