February 1, 2024
Top 10 Stock Mitsui Hold 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: Mitsui – Top 10 Stock in Nikkei 225 Index
Mitsui is listed as a top 10 stock on February 01, 2024 in the market index Nikkei 225 because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company enjoys a positive professional investor sentiment, but all financial facts speak against a stock purchase. This is probably an investment into the future. Based on the Obermatt 360° View of 28 (28% performer), Obermatt assesses an overall hold recommendation for Mitsui on February 01, 2024.
Snapshot: Obermatt Ranks
| Country | Japan |
| Industry | Trading & Distribution |
| Index | TOPIX 100, Human Rights, Nikkei 225 |
| Size class | XX-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 Mitsui Hold
| 360 METRICS | February 1, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 26 |
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| GROWTH | ||||||||
| GROWTH | 19 |
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| SAFETY | ||||||||
| SAFETY | 47 |
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| SENTIMENT | ||||||||
| SENTIMENT | 86 |
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| 360° VIEW | ||||||||
| 360° VIEW | 28 |
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ANALYSIS: With an Obermatt 360° View of 28 (better than 28% compared with alternatives), overall professional sentiment and financial characteristics for the stock Mitsui are below the industry average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Mitsui. The consolidated Sentiment Rank has a good rank of 86, which means that professional investors are more optimistic about the stock than for 86% of alternative investment opportunities. But all other ranks are below average. The consolidated Value Rank has a rank of 26, which means that the share price of Mitsui is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. The consolidated Growth Rank also has a low rank of 19, meaning that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. This means that growth is lower than for 19% of competitors in the same industry. Finally, the consolidated Safety Rank has a riskier rank of 47 which means that the company has a riskier financing structure than 53% 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 28, Mitsui is worse than 72% of all alternative stock investment opportunities based on the Obermatt Method. As only the professional market sentiment (Sentiment Rank of 86) is above-average, and all other consolidated Obermatt Ranks are below peers, the stock investing proposition case is rather weak. The stock price is expensive for a company of this size in this industry, visible in the below-average Value Rank. Growth is below the competition based on the Growth Rank, and the company has more debt than other companies, according to the Safety Rank. So the question becomes: How important is the Sentiment Rank when all others are below average? When it comes to growth, the low rating might be justified if growth is expected in the future and not yet reflected in current performance. This is often the case for companies with intellectual property, such as technology and pharmaceutical companies. In the early phases, these companies are expensive compared with their size and may have a lot of debt on their books, as is the case here, as seen in the low Value and Safety Ranks. Future growth may be the strongest investment rationale in this case, which is only reflected by institutional investors' opinions. You pay more than the market average for this stock and invest in a rather debt-loaded enterprise, but it may be worth it if the future of Mitsuị is bright. A small investment might be justified, but proceed with caution. ...read more
Sentiment Strategy: Professional Market Sentiment for Mitsui very positive
ANALYSIS: With an Obermatt Sentiment Rank of 86 (better than 86% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Mitsui is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Mitsui. Analyst Opinions are at a rank of 56 (better than 56% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. In addition, Analyst Opinions Change has a rank of 88, which means that stock research experts are changing their opinions for the better in recommending investing in the company. In other words, they are getting even more optimistic about investments in Mitsui. Finally, the Professional Investors rank is 76, which means that currently, professional investors hold more stock in this company than in 76% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 86 (more positive than 86% compared with investment alternatives), Mitsui has a reputation among professional investors that is significantly higher than that of its competitors. Pros tend to favor investing in this company. But there is also a signal for caution. Market Pulse has a rank of 30, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 70% of competitors). This could mean future risks and should make investors careful. Attention to negative news for Mitsui is worthwhile because they may be early warning signals. Without those, all other professional signals are encouraging, especially since analysts are getting more optimistic. ...read more
Value Strategy: Mitsui Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 26 (worse than 74% compared with alternatives), Mitsui shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Mitsui. Only Price-to-Profit (also referred to as price-earnings, P/E) indicates good stock value with a rank of 67, which means that the stock price compared with what market professionals expect for future profits is lower than for 67% of comparable companies, indicating a good value concerning Mitsui's profit levels. But Price-to-Sales is 34 which means that the stock price compared with what market professionals expect for future profits is higher than for 66% of comparable companies, indicating a low value concerning Mitsui's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 44 and for dividend yield, which is lower than for 58% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 26, is a hold recommendation based on Mitsui's stock price compared with the company's operational size and dividend yields. Can we rely on only one good value indicator? Only if we know the company well. In this case, a high Price-to-Profit Rank, while Price-to-Sales and Price-to-Book are both below the market typical levels, means that the company can charge higher prices for its products and needs less capital to produce them. If this is sustainable, then Mitsui is a good investment because profits count most in enterprise valuations. The low dividend yield indicates that the company is confident it can do something with the generated cash that is more valuable than paying the profits out to the shareholders in the form of dividends. ...read more
Growth Strategy: Mitsui Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 19 (better than 19% compared with alternatives), Mitsui 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 Mitsui. Sales Growth has a below market rank of 4, which means that, currently, professionals expect the company to grow less than 96% of its competitors. The same is valid for Capital Growth, with a rank of 4, and Profit Growth, with a rank of 42. Currently, professionals expect the company to grow its profits less than 58% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 79, which means that the stock returns have recently been above 79% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 19, is a sell recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for Mitsui, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with recent above-market stock returns. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive stock returns are not yet a sign of recovery. Investors should look closely at the Value and Sentiment indicators before they make a stock purchasing decision, because growth is unlikely to be the driving argument behind this investment. ...read more
Safety Strategy: Mitsui Debt Financing Safety below-average
| SAFETY METRICS | February 1, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 44 |
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| REFINANCING | ||||||||
| REFINANCING | 41 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 34 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 47 |
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ANALYSIS: With an Obermatt Safety Rank of 47 (better than 47% compared with alternatives), the company Mitsui has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Mitsui 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 Mitsui. Liquidity is at 34, meaning that the company generates less profit to service its debt than 66% 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 44, meaning the company has an above-average debt-to-equity ratio. It has more debt than 56% of its competitors. Finally, Refinancing is at a rank of 41 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 59% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 47 (worse than 53% compared with alternatives), Mitsui has a financing structure that is 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: Mitsui Lowest Financial Performance
| COMBINED PERFORMANCE | February 1, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 26 |
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| GROWTH | ||||||||
| GROWTH | 19 |
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| SAFETY | ||||||||
| SAFETY | 34 |
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| COMBINED | ||||||||
| COMBINED | 10 |
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ANALYSIS: With an Obermatt Combined Rank of 10 (worse than 90% compared with investment alternatives), Mitsui (Trading & Distribution, Japan) shares have lower financial characteristics compared with similar stocks. Shares of Mitsui are low in value (priced high) with a consolidated Value Rank of 26 (worse than 74% of alternatives), show below-average growth (Growth Rank of 19), and are riskily financed (Safety Rank of 47), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 10, is a sell recommendation based on Mitsui's financial characteristics. As the company Mitsui's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 26), low growth (Obermatt Growth Rank of 19), and risky financing practices (Obermatt Safety Rank of 47), 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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