May 11, 2023
Top 10 Stock Link Administrations 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: Link Administrations – Top 10 Stock in Australian Securities Exchange Index ASX 100
Link Administrations is listed as a top 10 stock on May 11, 2023 in the market index ASX 100 because of its high performance in at least one of the Obermatt investment strategies. Only the Obermatt Value Rank exhibits above-average performance, which means that the stock is seen as critical by the professional community and other financial facts are below average, providing mixed investment signals. Based on the Obermatt 360° Rank of 11 (11% performer), Obermatt issues an overall sell recommendation for Link Administrations on May 11, 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° Assessment Link Administrations Sell
| 360 METRICS | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 95 |
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| GROWTH | ||||||||
| GROWTH | 17 |
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| SAFETY | ||||||||
| SAFETY | 1 |
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| SENTIMENT | ||||||||
| SENTIMENT | 16 |
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| 360° VIEW | ||||||||
| 360° VIEW | 11 |
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ANALYSIS: With an Obermatt 360° Rank of 11 (better than 11% compared with alternatives), overall professional sentiment and engagement for the stock Link Administrations are critical, mostly below average. The 360° Rank is based on consolidating four consolidated indicators, with three out of four indicators below average for Link Administrations. Only the consolidated Value Rank has an attractive rank of 95, which means that the share price of Link Administrations is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 95% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 17, 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. The consolidated Safety Rank has a riskier rank of 1, meaning the company has a riskier financing structure than 99% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, professionals are more pessimistic about the stock than for 84% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 16. ...read more
RECOMMENDATION: With a 360° Rank of 11, Link Administrations is worse than 89% of all alternative stock investment opportunities based on the Obermatt Method. This means that Link Administrations shares are on the riskier side for investors. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 95. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 17), a riskier financing structure (Safety Rank of 1), and negative market sentiment in the professional investor community (Sentiment Rank of 16). This combination is sensitive to a crisis, because high debt levels (low safety) require growth to finance the debt burden. It’s no wonder that the investor community indicators are skeptical (low sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. We recommend evaluating whether the future of Link Administrations is as challenging as the low price of the stock suggests. Since the professional community is pessimistic, you might need to worry about the future of Link Administrations. Only invest if you have solid reasons to believe that the sluggish growth is temporary and the current market sentiment is an overreaction, possibly due to reputational issues in the past. ...read more
Sentiment Strategy: Professional Market Sentiment for Link Administrations negative
ANALYSIS: With an Obermatt Sentiment Rank of 16 (better than 16% compared with alternatives), overall professional sentiment and engagement for the stock Link Administrations is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half the indicators below and half above average for Link Administrations. Analyst Opinions are at a rank of 49 (worse than 51% 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 19, which means that stock research experts are getting even more pessimistic. In addition, the Professional Investors rank is 18, which means that professional investors hold less stock in this company than in 82% of alternative investment opportunities. Pros tend to invest in other companies. The only positive sentiment indicator for Link Administrations is Market Pulse, with a rank of 62, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 62% of competitors). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 16 (less encouraging than 84% compared with investment alternatives), Link Administrations has a reputation among professional investors that is far 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: Link Administrations Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 95 (better than 95% compared with alternatives) for 2023, Link Administrations shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Link Administrations. Price-to-Sales has a value of 83 which means that the stock price compared with what market professionals expect for future sales is lower than 83% of comparable companies, indicating a good value for Link Administrations's revenue size. The same is valid for expected Price-to-Profits, more favorable than 91% of alternatives, and it is also true for the Price-to-Book capital (also referred to as market-to-book ratio) with an Obermatt Price-to-Capital Rank of 77. Compared with other companies in the same industry, dividend yields of Link Administrations are expected to be higher than 88% of all competitors (an Obermatt Dividend Yield rank of 88). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 95, is a strong buy recommendation based on Link Administrations'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 Link Administrations based on its detailed value metrics.
Growth Strategy: Link Administrations Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 17 (better than 17% compared with alternatives), Link Administrations 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 Link Administrations. Only Capital Growth has a good rank of 82, which means that currently professionals expect the company to grow its invested capital more than 17% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 1 which means that currently professionals expect the company to grow less than 99% of its competitors. Profit Growth with a rank of 17 and Stock Returns with a rank of 33 are also low (below 67% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 17, 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 Link Administrations 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: Link Administrations Debt Financing Safety risky
| SAFETY METRICS | May 11, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 12 |
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| REFINANCING | ||||||||
| REFINANCING | 4 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 24 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 1 |
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ANALYSIS: With an Obermatt Safety Rank of 1 (better than 1% compared with alternatives), the company Link Administrations 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 Link Administrations 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 Link Administrations. Liquidity is at 24, meaning that the company generates less profit to service its debt than 76% 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 12, meaning the company has an above-average debt-to-equity ratio. It has more debt than 88% of its competitors. Finally, Refinancing is at a rank of 4 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 96% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 1 (worse than 99% compared with alternatives), Link Administrations 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. ...read more
Combined financial peformance: Link Administrations Below-Average Financial Performance
| COMBINED PERFORMANCE | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 95 |
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| GROWTH | ||||||||
| GROWTH | 17 |
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| SAFETY | ||||||||
| SAFETY | 24 |
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| COMBINED | ||||||||
| COMBINED | 27 |
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ANALYSIS: With an Obermatt Combined Rank of 27 (worse than 73% compared with investment alternatives), Link Administrations (Data Processing & Outsourcing, Australia) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Link Administrations are a good value (attractively priced) with a consolidated Obermatt Value Rank of 95 (better than 95% of alternatives) but show below-average growth (Growth Rank of 17), and are riskily financed (Safety Rank of 1), which means above-average debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 27, is a hold recommendation based on Link Administrations's financial characteristics. As the company Link Administrations's key financial metrics exhibit good value (Obermatt Value Rank of 95) but low growth (Obermatt Growth Rank of 17) and risky financing practices (Obermatt Safety Rank of 1), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 95% of comparable companies, may indicate 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. ...read more
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