March 21, 2024
Top 10 Stock Merry Electronics 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: Merry Electronics – Top 10 Stock in SDG 4: Quality Education
Merry Electronics is listed as a top 10 stock on March 21, 2024 in the market index SDG 4 because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. The company is growing above average and 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 50 (high 50% performer), Obermatt assesses an overall buy recommendation for Merry Electronics on March 21, 2024.
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° View Merry Electronics Buy
| 360 METRICS | March 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 45 |
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| GROWTH | ||||||||
| GROWTH | 53 |
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| SAFETY | ||||||||
| SAFETY | 21 |
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| SENTIMENT | ||||||||
| SENTIMENT | 96 |
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| 360° VIEW | ||||||||
| 360° VIEW | 50 |
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ANALYSIS: With an Obermatt 360° View of 50 (better than 50% compared with alternatives), overall professional sentiment and financial characteristics for the stock Merry Electronics are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Merry Electronics. The consolidated Growth Rank has a good rank of 53, 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 53% of competitors in the same industry. The consolidated Sentiment Rank also has a good rank of 96, which means that professional investors are more optimistic about the stock than for 96% of alternative investment opportunities. But the consolidated Value Rank has a less desirable rank of 45, which means that the share price of Merry Electronics 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 55% of alternative stocks in the same industry. Finally, the consolidated Safety Rank has a riskier rank of 21, which means that the company has a financing structure that is riskier than those of 79% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. ...read more
RECOMMENDATION: With a consolidated 360° View of 50, Merry Electronics is better positioned than 50% of all alternative stock investment opportunities based on the Obermatt Method. Only half of the consolidated Obermatt Ranks exhibit excellent performance, so one needs to take a close look. Growth is above-average (Growth Rank of 53), and professional market sentiment is positive (Sentiment Rank of 96), but value and safety are below average. The Safety Rank is the least significant of the four consolidated ranks, because it only reflects financing practices. In the case of high growth, aggressive financing is a good thing. So the question is: How to assess below-average value against above-average growth and sentiment? Growth may be the strongest driver of the investment rationale in this case, which is reflected in institutional investors' opinions. It is typical for growth companies to have low value, as is the case here. Investors are willing to pay more for companies that outperform their competitors. So the question is, how much do you sacrifice value for growth? You can use the following rule of thumb: If you take 100 minus the growth rank, you arrive at a possibly minimum level for the value 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 growth rank is above 60. Sometimes market sentiment just extrapolates the past, but sometimes it reflects reality. You pay more than the market average for this stock, but it may be worth it. ...read more
Sentiment Strategy: Professional Market Sentiment for Merry Electronics very positive
ANALYSIS: With an Obermatt Sentiment Rank of 96 (better than 96% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Merry Electronics is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Merry Electronics. Analyst Opinions are at a rank of 44 (worse than 56% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 84, which indicates a shift in stock research experts opinions for the better. In other words, they are getting more optimistic about stock investments in Merry Electronics. Even better, the Professional Investors rank is 94, meaning that professional investors hold more stock in this company than in 94% of alternative investment opportunities. Pros tend to favor investing in this company. Furthermore, Market Pulse has a rank of 100, which means that the current professional news and professional social networks are upbeat when discussing this company (more positive news than for 100% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 96 (more positive than 96% compared with investment alternatives), Merry Electronics has a reputation among professional investors that is significantly higher than that of its competitors. While analysts are still critical of the company, some are changing their minds. In addition, the professional news channels are optimistic, and many institutional investors have already bought stock in the company. These are encouraging signals, despite the still lower level of analyst recommendations. They may be due to a problematic past, and about to change. The positive sentiment signals are stronger than the negative. ...read more
Value Strategy: Merry Electronics Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 45 (worse than 55% compared with alternatives), Merry Electronics 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 Merry Electronics. Price-to-Sales (P/S) is 68, which means that the stock price compared with what market professionals expect for future sales is lower than for 68% of comparable companies, indicating a good value concerning Merry Electronics's revenue size. The same is valid for dividend yields with a Dividend Yield rank of 72, which means that dividends are expected to be higher than for 72% 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 57% of alternatives (only 43% 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 57% 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 45, is a hold recommendation based on Merry Electronics'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: Merry Electronics Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 53 (better than 53% compared with alternatives), Merry Electronics 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 Merry Electronics. Capital Growth has a rank of 55, which means that currently professionals expect the company to grow its invested capital more than 42% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 65 (above 65% of alternative investments). But Sales Growth has only a rank of 38, which means that, currently, professionals expect the company to grow less than 62% of its competitors, and Profit Growth is also low at a rank of 42. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 53, is a buy recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for Merry Electronics, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. ...read more
Safety Strategy: Merry Electronics Debt Financing Safety risky
| SAFETY METRICS | March 21, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 35 |
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| REFINANCING | ||||||||
| REFINANCING | 25 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 55 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 21 |
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ANALYSIS: With an Obermatt Safety Rank of 21 (better than 21% compared with alternatives), the company Merry Electronics 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 Merry Electronics 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 just one indicator above average for Merry Electronics. Liquidity is 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. But Refinancing is riskier at a rank of 25, which means that the portion of the debt that is about to be refinanced is above average. It has more debt in the refinancing stage than 75% of its competitors. Leverage is also high at a rank of 35, which means that the company has an above-average debt-to-equity ratio. It has more debt than 65% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 21 (worse than 79% compared with alternatives), Merry Electronics has a financing structure that is significantly riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. ...read more
Combined financial peformance: Merry Electronics Lowest Financial Performance
| COMBINED PERFORMANCE | March 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 45 |
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| GROWTH | ||||||||
| GROWTH | 53 |
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| SAFETY | ||||||||
| SAFETY | 55 |
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| COMBINED | ||||||||
| COMBINED | 21 |
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ANALYSIS: With an Obermatt Combined Rank of 21 (worse than 79% compared with investment alternatives), Merry Electronics (Consumer Electronics, Taiwan) shares have lower financial characteristics compared with similar stocks. Shares of Merry Electronics are low in value (priced high) with a consolidated Value Rank of 45 (worse than 55% of alternatives), and are riskily financed (Safety Rank of 21, which means above-average debt burdens) but show above-average growth (Growth Rank of 53). ...read more
RECOMMENDATION: A Combined Rank of 21, is a sell recommendation based on Merry Electronics's financial characteristics. As the company Merry Electronics shows low value with an Obermatt Value Rank of 45 (55% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 53% of comparable companies (Obermatt Growth Rank is 53). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 21 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Merry Electronics, even a low-value company (in terms of its key financial indicators) can be a good investment. ...read more
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