January 18, 2024
Top 10 Stock Matrix Service 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: Matrix Service – Top 10 Stock in Dow Jones U.S. Oil Equipment & Services Index
Matrix Service is listed as a top 10 stock on January 18, 2024 in the market index D.J. US Oil Companies 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 18 (18% performer), Obermatt issues an overall sell recommendation for Matrix Service on January 18, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Construction & Engineering |
| Index | NASDAQ, D.J. US Oil Companies |
| Size class | Medium |
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 Matrix Service Sell
| 360 METRICS | January 18, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 43 |
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| GROWTH | ||||||||
| GROWTH | 63 |
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| SAFETY | ||||||||
| SAFETY | 56 |
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| SENTIMENT | ||||||||
| SENTIMENT | 11 |
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| 360° VIEW | ||||||||
| 360° VIEW | 18 |
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ANALYSIS: With an Obermatt 360° View of 18 (better than 18% compared with alternatives), overall professional sentiment and financial characteristics for the stock Matrix Service are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Matrix Service. The consolidated Growth Rank has a good rank of 63, 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 63% of competitors in the same industry. In addition, the consolidated Safety Rank has a safer rank of 56 which means that the company has a financing structure that is safer than 56% 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 43 which means that the share price of Matrix Service 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 57% of alternative stocks in the same industry. The consolidated Sentiment Rank also has a low rank of 11, which means that professional investors are more pessimistic about the stock than for 89% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 18, Matrix Service is worse than 82% of all alternative stock investment opportunities based on the Obermatt Method. This means that Matrix Service shares are on the riskier side for investors. As only half of the consolidated Obermatt Ranks exhibit excellent performance, the picture is ambiguous. Growth is above-average (Growth Rank of 63), and the company is safely financed (Safety Rank of 56). However, professional market sentiment is low(Sentiment Rank of 11). The negative market view on Matrix Service 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 Matrix Service 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 Matrix Service negative
ANALYSIS: With an Obermatt Sentiment Rank of 11 (better than 11% compared with alternatives), overall professional sentiment and engagement for the stock Matrix Service 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 Matrix Service. Analyst Opinions are at a rank of 73 (better than 73% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive and has a rank of 50 which means that currently, stock research experts are getting even more optimistic about investments in Matrix Service. But Market Pulse has a low rank of 4, 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 96% of competitors). This is an essential sign of caution, as it could be the forebearer of bad news. Professional Investors are also somewhat absent with a rank of 26, which means that, currently, professional investors hold less stock in this company than in 74% of alternative investment opportunities. Pros tend to invest in other companies. This is expected if the company is of a smaller size (medium or smaller). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 11 (less encouraging than 89% compared with investment alternatives), Matrix Service has a reputation among professional investors that is far below that of its competitors. While the general news feeds in the professional market are negative, the analyst recommendations are optimistic about the company, and even increase their ratings despite the negative news. This is an ambiguous situation with positive and negative signals from the professional side. Investors should be on the lookout for negative news but not worry too much about it as long as the overall news is still positive. ...read more
Value Strategy: Matrix Service Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 43 (worse than 57% compared with alternatives), Matrix Service 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 Matrix Service. Price-to-Sales (P/S) is 91, which means that the stock price compared with what market professionals expect for future sales is lower than for 91% of comparable companies, indicating a good value concerning Matrix Service's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio), which is more favorable than for 82% of alternatives (18% of peers have a higher ratio). But expected dividend yields with a Dividend Yield rank of 1 are lower than average (dividends are expected to be lower than 99% of other stocks) while the Price to Profit ratio (or Price to Earnings (P/E) ratio) is higher than average with a Price-to-Profit Rank of 10, 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 43, is a hold recommendation based on Matrix Service's stock price compared with the company's operational size and dividend yields. Low profits and low dividends as seen here for Matrix Service may indicate a restructuring phase. This could be transitory, making the company a good value when profits recover and dividends return to higher levels. If the stock price is compared with the size indicators for revenue and invested capital, it is on the lower side, making this stock a good value investment (apart from current profit and dividend expectations). ...read more
Growth Strategy: Matrix Service Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 63 (better than 63% compared with alternatives), Matrix Service 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, with half of the indicators below and half above average for Matrix Service. Sales Growth has a rank of 84, which means that, currently, professionals expect the company to grow more than 84% of its competitors. Profit Growth with a rank of 86 is also above average. But Capital Growth has only a rank of 11, and Stock Returns with 49 are also below-average. Stock returns for Matrix Service have recently been below 51% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 63, is a buy recommendation for growth and momentum investors. Are investors forecasting troubles based on the lack of operating investment activity at the company? This could be one explanation as to why stock returns are low. But stock returns can also be the result of correcting an error in the past, in this case, an overly optimistic outlook on the future, which is now more realistic. The Value Ranks may confirm such a picture. The more important growth indicators are revenues and profits, which are both above average for Matrix Service. This is a positive sign from the company's operational side and may give investors courage, despite the poor recent stock price performance. ...read more
Safety Strategy: Matrix Service Debt Financing Safety above-average
| SAFETY METRICS | January 18, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 88 |
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| REFINANCING | ||||||||
| REFINANCING | 70 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 4 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 56 |
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ANALYSIS: With an Obermatt Safety Rank of 56 (better than 56% compared with alternatives), the company Matrix Service 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 Matrix Service 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 two out of three are above average for Matrix Service.Leverage is at 88, meaning the company has a below-average debt-to-equity ratio. It has less debt than 88% of its competitors.Refinancing is at a rank of 70, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 70% of its competitors. 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 regarding debt service. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 56 (better than 56% compared with alternatives), Matrix Service has a financing structure that is safer than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. ...read more
Combined financial peformance: Matrix Service Above-Average Financial Performance
| COMBINED PERFORMANCE | January 18, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 43 |
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| GROWTH | ||||||||
| GROWTH | 63 |
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| SAFETY | ||||||||
| SAFETY | 4 |
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| COMBINED | ||||||||
| COMBINED | 56 |
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ANALYSIS: With an Obermatt Combined Rank of 56 (better than 56% compared with investment alternatives), Matrix Service (Construction & Engineering, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Matrix Service are low in value (priced high) with a consolidated Value Rank of 43 (worse than 57% of alternatives). But they show above-average growth (Growth Rank of 63) and are safely financed (Safety Rank of 56, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 56, is a buy recommendation based on Matrix Service's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Matrix Service exhibits low value (Obermatt Value Rank of 43), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 63). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 56) 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
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