February 22, 2024
Top 10 Stock Leggett & Platt Sell 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: Leggett & Platt – Top 10 Stock in S&P 500 Index
Leggett & Platt is listed as a top 10 stock on February 22, 2024 in the market index S&P 500 because of its high performance in at least one of the Obermatt investment strategies. All consolidated Obermatt Ranks are below-average. Based on the Obermatt Method, an investment in the company is not advisable today. Based on the Obermatt 360° View of 1 (1% performer), Obermatt issues an overall sell recommendation for Leggett & Platt on February 22, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Home Furnishings |
| Index | Dividends USA, Human Rights, Water Tech, S&P US Luxury, S&P 500 |
| 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 Leggett & Platt Sell
| 360 METRICS | February 22, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 42 |
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| GROWTH | ||||||||
| GROWTH | 15 |
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| SAFETY | ||||||||
| SAFETY | 12 |
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| SENTIMENT | ||||||||
| SENTIMENT | 1 |
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| 360° VIEW | ||||||||
| 360° VIEW | 1 |
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ANALYSIS: With an Obermatt 360° View of 1 (better than 1% compared with alternatives), overall professional sentiment and financial characteristics for the stock Leggett & Platt are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with all four indicators below average for Leggett & Platt. The consolidated Value Rank has a low rank of 42 which means that the share price of Leggett & Platt is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 58% of alternative stocks in the same industry. The consolidated Growth Rank also has a low rank of 15, which means that the company exhibits below-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 lower than for 15% of competitors in the same industry. The consolidated Safety Rank has a riskier rank of 12, which means that the company has a riskier financing structure than 88% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a low rank of 1, which means that professional investors are more pessimistic about the stock than for 99% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 1, Leggett & Platt is worse than 99% of all alternative stock investment opportunities based on the Obermatt Method. This means that Leggett & Platt shares are on the riskier side for investors. As all consolidated Obermatt Ranks are below-average, this is a risky stock investment proposition, especially since professional investor sentiment, the consolidated Obermatt Sentiment Rank, is also low at 1. The negative market view on Leggett & Platt may stem from the high stock price (low value), the low level of growth, or the risky financing structures. That's several problems with no good news anywhere. Based on the current information, we don’t see any compelling arguments to make a case for this stock investment. The company may have a strong future which would justify the high stock price, but this is not confirmed by investor behavior today. While Leggett & Platt may have a bright future, it is reflected in neither the financial indicators nor the market sentiment. ...read more
Sentiment Strategy: Professional Market Sentiment for Leggett & Platt negative
ANALYSIS: With an Obermatt Sentiment Rank of 1 (better than 1% compared with alternatives), overall professional sentiment and engagement for the stock Leggett & Platt is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Leggett & Platt. Analyst Opinions are at a rank of 1 (worse than 99% 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 2 which means that stock research experts are getting even more pessimistic. It doesn't end with the analysts. Market Pulse is also low 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). No wonder, the Professional Investors rank is only 18, which means that professional investors hold less stock in this company than in 82% of alternative investment opportunities. Pros tend to stay away from Leggett & Platt, which may be due to a small company size but just as likely because of its relatively low Sentiment Rank. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 1 (less encouraging than 99% compared with investment alternatives), Leggett & Platt has a reputation among professional investors that is far below that of its competitors. Investors should be careful with this stock right now. Further research is required if an investment is desired, because the facts found in the professional community are all negative. ...read more
Value Strategy: Leggett & Platt Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 42 (worse than 58% compared with alternatives), Leggett & Platt shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half above average for Leggett & Platt. Price-to-Sales (P/S) is 59, which means that the stock price compared with what market professionals expect for future sales is lower than for 59% of comparable companies, indicating a good value concerning Leggett & Platt's revenue size. The same is valid for dividend yields with a Dividend Yield rank of 100, which means that dividends are expected to be higher than for 100% of comparable investments. On the other hand, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is less favorable than for 72% of alternatives (only 28% of peers have an even higher ratio). The same is valid for the Price-to-Profit (or Price / Earnings, P/E) ratio, which is higher than for 77% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 42, is a hold recommendation based on Leggett & Platt's stock price compared with the company's operational size and dividend yields. This is a somewhat surprising picture, because it means that profits are low while dividends are high. One interpretation could be that profits are expected to increase, justifying the high dividend payments. But it could also mean that the company desperately keeps the high dividends to avoid a collapsing share price. This would be a rather dangerous constellation. ...read more
Growth Strategy: Leggett & Platt Growth Momentum negative
| GROWTH METRICS | February 22, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 23 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 30 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 57 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 17 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 15 |
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ANALYSIS: With an Obermatt Growth Rank of 15 (better than 15% compared with alternatives), Leggett & Platt 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 Leggett & Platt. Only Capital Growth has a good rank of 57, which means that currently professionals expect the company to grow its invested capital more than 30% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 23 which means that currently professionals expect the company to grow less than 77% of its competitors. Profit Growth with a rank of 30 and Stock Returns with a rank of 17 are also low (below 83% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 15, 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 Leggett & Platt 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: Leggett & Platt Debt Financing Safety risky
| SAFETY METRICS | February 22, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 15 |
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| REFINANCING | ||||||||
| REFINANCING | 45 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 4 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 12 |
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ANALYSIS: With an Obermatt Safety Rank of 12 (better than 12% compared with alternatives), the company Leggett & Platt 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 Leggett & Platt 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 Leggett & Platt. Liquidity is at 4, meaning that the company generates less profit to service its debt than 96% 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 15, meaning the company has an above-average debt-to-equity ratio. It has more debt than 85% 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 a consolidated Safety Rank of 12 (worse than 88% compared with alternatives), Leggett & Platt 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.
Combined financial peformance: Leggett & Platt Lowest Financial Performance
| COMBINED PERFORMANCE | February 22, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 42 |
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| GROWTH | ||||||||
| GROWTH | 15 |
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| SAFETY | ||||||||
| SAFETY | 4 |
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| COMBINED | ||||||||
| COMBINED | 5 |
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ANALYSIS: With an Obermatt Combined Rank of 5 (worse than 95% compared with investment alternatives), Leggett & Platt (Home Furnishings, USA) shares have lower financial characteristics compared with similar stocks. Shares of Leggett & Platt are low in value (priced high) with a consolidated Value Rank of 42 (worse than 58% of alternatives), show below-average growth (Growth Rank of 15), and are riskily financed (Safety Rank of 12), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 5, is a sell recommendation based on Leggett & Platt's financial characteristics. As the company Leggett & Platt's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 42), low growth (Obermatt Growth Rank of 15), and risky financing practices (Obermatt Safety Rank of 12), 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. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. ...read more
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