January 4, 2024
Top 10 Stock MSCI 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: MSCI – Top 10 Stock in Dow Jones U.S. Investment Services Index
MSCI is listed as a top 10 stock on January 04, 2024 in the market index D.J. US Investing 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 27 (27% performer), Obermatt assesses an overall hold recommendation for MSCI on January 04, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Financial Exchanges & Data |
| Index | Employee Focus US, Human Rights, Renewables Users, SDG 10, SDG 13, SDG 5, SDG 8, D.J. US Investing, S&P 500 |
| Size class | 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 MSCI Hold
| 360 METRICS | January 4, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 26 |
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| GROWTH | ||||||||
| GROWTH | 77 |
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| SAFETY | ||||||||
| SAFETY | 1 |
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| SENTIMENT | ||||||||
| SENTIMENT | 74 |
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| 360° VIEW | ||||||||
| 360° VIEW | 27 |
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ANALYSIS: With an Obermatt 360° View of 27 (better than 27% compared with alternatives), overall professional sentiment and financial characteristics for the stock MSCI are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for MSCI. The consolidated Growth Rank has a good rank of 77, 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 77% of competitors in the same industry. The consolidated Sentiment Rank also has a good rank of 74, which means that professional investors are more optimistic about the stock than for 74% of alternative investment opportunities. But the consolidated Value Rank has a less desirable rank of 26, which means that the share price of MSCI 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 74% of alternative stocks in the same industry. Finally, the consolidated Safety Rank has a riskier rank of 1, which means that the company has a financing structure that is riskier than those of 99% 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 27, MSCI is worse than 73% 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 77), and professional market sentiment is positive (Sentiment Rank of 74), 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 MSCI positive
ANALYSIS: With an Obermatt Sentiment Rank of 74 (better than 74% compared with alternatives), overall professional sentiment and engagement for the stock MSCI is above average. The Sentiment Rank is based on consolidating four sentiment indicators where all but one are above average for MSCI. Analyst Opinions are at a rank of 55 (better than 55% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. The Professional Investors rank is also good at 63, which means that currently, professional investors hold more stock in this company than in 63% of alternative investment opportunities. Pros tend to favor investing in this company. In addition, Market Pulse has a rank of 87 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 87% of competitors). But Analyst Opinions Change has a below-average rank of 45, which means that stock research experts are currently changing their opinions for the worse when it comes to recommending this stock. In other words, they are getting more critical of investments in MSCI. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 74 (more positive than 74% compared with investment alternatives), MSCI has a reputation among professional investors that is above-average compared with that of its competitors. This is an early sign of caution, even if the stock has significantly appreciated. If analysts change their opinions, the stock may become too expensive. If the price is on the way down, the trend may continue. This may be a stock with a good reputation and history, but it may have reached its breaking point by now. Investors should look at the Value Ranks as well. If they indicate trouble, it might just materialize in the future. ...read more
Value Strategy: MSCI Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 26 (worse than 74% compared with alternatives), MSCI shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators where three out of four are below average for MSCI. Only the Price-to-Book Capital ratio (also referred to as market-to-book ratio) indicates good stock value with a Price-to-Book Rank of 100, which means that the stock price is lower compared with invested capital than for 100% of comparable investments. All other value indicators are below the market median. Price-to-Sales is 1 which means the stock price compared with what market professionals expect for future profits is higher than 99% of comparable companies, indicating a low value concerning MSCI's revenue levels. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Book Rank of 100 and for the dividend yields rank which is lower than for 70% of comparable companies, making the stock more expensive as regards to with 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 MSCI's stock price compared with the company's operational size and dividend yields. Why are market participants paying such a high price for MSCI, where three out of four value indicators are below par? One reason could be that the company is well financed, indicated by the high book capital level, and has a promising future that is not yet visible in reported revenues and profits. That would also explain the low dividend yield because the company needs the cash to invest in its future. If investors can verify a picture in this sense, the stock may still be a good investment, even though current company-reported financials don't fully explain current stock prices. ...read more
Growth Strategy: MSCI Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 77 (better than 77% compared with alternatives) for 2023, MSCI shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for MSCI. Sales Growth has a value of 77 which means that currently professionals expect the company to grow more than 77% of its competitors. Profit Growth with a value of 77 and Capital Growth with a rank of 55 means that currently, professionals expect the company to grow both profits and invested capital more than of its competitors. But Stock Returns has only a rank of 49, which means that stock returns have recently been below 51% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 77, is a buy recommendation for growth and momentum investors. MSCI has only one below-average growth indicator, the stock returns. This is probably the least reliable growth indicator, because it measures company and investor expectations at the same time. The three other growth indicators, which are all positive for MSCI, are more reliable measures of growth momentum. For this reason, the company seems to be on a good trajectory, unless you think the current period is not representative, because of unique events that will not be repeated in the future. ...read more
Safety Strategy: MSCI Debt Financing Safety risky
| SAFETY METRICS | January 4, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 3 |
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| REFINANCING | ||||||||
| REFINANCING | 5 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 34 |
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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 MSCI 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 MSCI 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 MSCI. 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 3, meaning the company has an above-average debt-to-equity ratio. It has more debt than 97% of its competitors. Finally, Refinancing is at a rank of 5 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 95% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 1 (worse than 99% compared with alternatives), MSCI 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: MSCI Lowest Financial Performance
| COMBINED PERFORMANCE | January 4, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 26 |
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| GROWTH | ||||||||
| GROWTH | 77 |
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| SAFETY | ||||||||
| SAFETY | 34 |
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| COMBINED | ||||||||
| COMBINED | 6 |
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ANALYSIS: With an Obermatt Combined Rank of 6 (worse than 94% compared with investment alternatives), MSCI (Financial Exchanges & Data, USA) shares have lower financial characteristics compared with similar stocks. Shares of MSCI are low in value (priced high) with a consolidated Value Rank of 26 (worse than 74% of alternatives), and are riskily financed (Safety Rank of 1, which means above-average debt burdens) but show above-average growth (Growth Rank of 77). ...read more
RECOMMENDATION: A Combined Rank of 6, is a sell recommendation based on MSCI's financial characteristics. As the company MSCI shows low value with an Obermatt Value Rank of 26 (74% 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 77% of comparable companies (Obermatt Growth Rank is 77). 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 1 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 MSCI, even a low-value company (in terms of its key financial indicators) can be a good investment. ...read more
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