February 15, 2024
Top 10 Stock K&S 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: K&S – Top 10 Stock in Deutscher Aktienindex Mid Cap MDAX
K&S is listed as a top 10 stock on February 15, 2024 in the market index MDAX 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 negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 60 (high 60% performer), Obermatt assesses an overall buy recommendation for K&S on February 15, 2024.
Snapshot: Obermatt Ranks
| Country | Germany |
| Industry | Fertilizers & Agricultural Chemicals |
| Index | CDAX, Low Emissions, Dividends Europe, Energy Efficient, MDAX |
| Size class | X-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 K&S Buy
| 360 METRICS | February 15, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 69 |
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| GROWTH | ||||||||
| GROWTH | 13 |
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| SAFETY | ||||||||
| SAFETY | 100 |
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| SENTIMENT | ||||||||
| SENTIMENT | 32 |
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| 360° VIEW | ||||||||
| 360° VIEW | 60 |
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ANALYSIS: With an Obermatt 360° View of 60 (better than 60% compared with alternatives), overall professional sentiment and financial characteristics for the stock K&S are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for K&S. The consolidated Value Rank has an attractive rank of 69, which means that the share price of K&S 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 69% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 100. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 32. Professional investors are more confident in 68% other stocks. The consolidated Growth Rank also has a low rank of 13, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 87 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 60, K&S is better positioned than 60% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 69), and the financing structure is on the safer side (Safety Rank of 100). However, sentiment in the professional investor community is below-average (Sentiment Rank of 32), as is the growth momentum for the company (Growth Rank of 13). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still 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 K&S only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 32 (better than 32% compared with alternatives), overall professional sentiment and engagement for the stock K&S is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half the indicators below and half above average for K&S. Analyst Opinions are at a rank of 36 (worse than 64% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 42, which means that stock research experts are getting even more pessimistic. In addition, the Professional Investors rank is 30, which means that professional investors hold less stock in this company than in 70% of alternative investment opportunities. Pros tend to invest in other companies. The only positive sentiment indicator for K&S is Market Pulse, with a rank of 56, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 56% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 32 (less encouraging than 68% compared with investment alternatives), K&S has a reputation among professional investors that is below that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: K&S Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 69 (better than 69% compared with alternatives), K&S shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, where three out of four indicators are above average for K&S. Price-to-Sales (P/S) is 64 which means that the stock price compared with what market professionals expect for future sales is lower than for 64% of comparable companies, indicating a good value for K&S's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 92. Finally, compared with other companies in the same industry, dividend yields of K&S are expected to be higher than for 52% of all competitors (a Dividend Yield rank of 52). The only low rank is for expected profits with a Price-to-Profit Rank of 46, indicating that the market expects the company's profit to be low despite a high dividend. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 69, is a buy recommendation based on K&S's stock price compared with the company's operational size and dividend yields. The low Profit Rank could result from a one-off charge, for instance, for an accident, a legal settlement, or a restructuring project. If the company keeps its dividends high, the low expected profit may be transitory. If that is the case, the three good value ranks for Sales, Capital, and Dividends are reliable indicators for good stock price value, a low stock price. ...read more
Growth Strategy: K&S Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 13 (better than 13% compared with alternatives), K&S shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below average for K&S. Only Capital Growth has a good rank of 62, which means that currently professionals expect the company to grow its invested capital more than 20% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 6 which means that currently professionals expect the company to grow less than 94% of its competitors. Profit Growth with a rank of 20 and Stock Returns with a rank of 25 are also low (below 75% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 13, is a sell recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for K&S is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. ...read more
Safety Strategy: K&S Debt Financing Safety very solid
| SAFETY METRICS | February 15, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 90 |
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| REFINANCING | ||||||||
| REFINANCING | 78 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 98 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 100 |
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ANALYSIS: With an Obermatt Safety Rank of 100 (better than 100% compared with alternatives) for 2024, the company K&S has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of K&S 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, where all three are above average for K&S. Leverage is at 90, meaning the company has a below-average debt-to-equity ratio. It has less debt than 90% of its competitors. Refinancing is at a rank of 78, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 78% of its competitors. Finally, Liquidity is also good at a rank of 98, which means that the company generates more profit to service its debt than 98% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 100 (better than 100% compared with alternatives), K&S has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more
Combined financial peformance: K&S Above-Average Financial Performance
| COMBINED PERFORMANCE | February 15, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 69 |
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| GROWTH | ||||||||
| GROWTH | 13 |
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| SAFETY | ||||||||
| SAFETY | 98 |
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| COMBINED | ||||||||
| COMBINED | 72 |
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ANALYSIS: With an Obermatt Combined Rank of 72 (better than 72% compared with investment alternatives), K&S (Fertilizers & Agricultural Chemicals, Germany) shares have above-average financial characteristics compared with similar stocks. Shares of K&S are a good value (attractively priced) with a consolidated Value Rank of 69 (better than 69% of alternatives), are safely financed (Safety Rank of 100, which means low debt burdens), but show below-average growth (Growth Rank of 13). ...read more
RECOMMENDATION: A Combined Rank of 72, is a buy recommendation based on K&S's financial characteristics. As the company K&S's key financial metrics exhibit good value (Obermatt Value Rank of 69) but low growth (Obermatt Growth Rank of 13) while being safely financed (Obermatt Safety Rank of 100), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 69% of comparable companies, may also indicate that 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 and the downside is limited due to below-average financing risks. ...read more
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