May 25, 2023
Top 10 Stock New Jersey Resources Strong 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: New Jersey Resources – Top 10 Stock in Employee Satisfaction Leaders in the United States
New Jersey Resources is listed as a top 10 stock on May 25, 2023 in the market index Employee Focus US because of its high performance in at least one of the Obermatt investment strategies. Three consolidated Obermatt Ranks are above-average. Only the Value Rank is below average. The investment rationale may be an investment in future growth, supported by professional market opinion. Based on the Obermatt 360° View of 90 (top 90% performer), Obermatt assesses an overall strong buy recommendation for New Jersey Resources on May 25, 2023.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Gas Utilities |
| Index | Customer Focus US, Dividends USA, Employee Focus US, S&P MIDCAP |
| 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° Assessment New Jersey Resources Strong Buy
| 360 METRICS | May 25, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 38 |
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| GROWTH | ||||||||
| GROWTH | 93 |
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| SAFETY | ||||||||
| SAFETY | 73 |
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| SENTIMENT | ||||||||
| SENTIMENT | 66 |
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| 360° VIEW | ||||||||
| 360° VIEW | 90 |
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ANALYSIS: With an Obermatt 360° View of 90 (better than 90% compared with alternatives) for 2023, overall professional sentiment and engagement for the stock New Jersey Resources are very positive. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for New Jersey Resources. The consolidated Growth Rank has a good rank of 93, 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 93% of competitors in the same industry. The consolidated Safety Rank at 73 means that the company has a financing structure that is safer than 73 comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a good rank of 66, which means that professional investors are more optimistic about the stock than for 66% of alternative investment opportunities. But the consolidated Value Rank is less desirable at 38, meaning that the share price of New Jersey Resources is on the higher side compared with indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 62% of alternative stocks in the same industry. ...read more
RECOMMENDATION: With a 360° View of 90, New Jersey Resources is better than 90% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as above-average growth (Growth Rank of 93), a safe financing structure (Safety Rank of 73), and positive professional market sentiment (Sentiment Rank of 66), it is a solid stock investment where growth may be the strongest driver of the investment rationale, also reflected by institutional investors. 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 more do you pay for the stock of New Jersey Resources compared with alternatives? You can use the following rule of dumb: The growth rank reflects where the growth momentum of the company is (93% better than peers). The value rank could be the reverse reflection of that (7%). A Value Rank below that level may be assessed as expensive, a rank above that is still good value. Sometimes market sentiment just extrapolates the past, but sometimes they are right. You pay more than the market average for this stock, but it may be worth it. ...read more
Sentiment Strategy: Professional Market Sentiment for New Jersey Resources positive
ANALYSIS: With an Obermatt Sentiment Rank of 66 (better than 66% compared with alternatives), overall professional sentiment and engagement for the stock New Jersey Resources is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for New Jersey Resources. Analyst Opinions are at a rank of 39 (worse than 61% 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 50, which means that stock research experts are more positive in their investment recommendations in the company. In other words, they are getting more optimistic of stock investments in New Jersey Resources. More encouragingly, the Professional Investors rank is 94, which means that professional investors hold more stock in this company than in 94% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 43, 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 57% of competitors). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 66 (more positive than 66% compared with investment alternatives), New Jersey Resources has a reputation among professional investors that is above-average compared with that of its competitors. The sentiment signals are mixed for New Jersey Resources. While analysts and the news channels are negative, there is a change in what stock research analysts think. Above-average institutional investors in this company support them. While the sentiment signals remain mixed with analysts and news channels pessimistic, some analysts are optimistic, which is an encouraging sign for investing in this stock. ...read more
Value Strategy: New Jersey Resources Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 38 (worse than 62% compared with alternatives), New Jersey Resources shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where the majority of metrics are below, and only one is above average for New Jersey Resources. Price-to-Sales (P/S) is 81, which means that the stock price compared with what market professionals expect for future sales is lower than 81% of comparable companies, indicating a good value concerning to New Jersey Resources's revenue size. But all other performance indicators point in a different direction. Dividend yields have a Dividend Yield rank of 28, meaning that dividends are expected to be lower than for 72% of comparable investments. Furthermore, Price-to-Book Capital (also referred to as market-to-book ratio) is less favorable than 86% of alternatives (only 14% of peers have an even higher ratio). The same is valid for Price-to-Profit (or Price / Earnings, P/E), which is higher than for 61% 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 38, is a HOLD recommendation based on New Jersey Resources's stock price compared with the company's operational size and dividend yields. Since Price-to-Sales is a stable value indicator even in challenging times, investing in New Jersey Resources could be seen as a value investment. However, there must be a good reason for the low market-to-book rank. If the company has a typical capital investment practice, the stock may be overvalued because the profit and dividend-related performance indicators are also low. The stock is only good value if investors can expect profits and dividends to pick up in the future. Else, New Jersey Resources looks like an expensive investment today. ...read more
Growth Strategy: New Jersey Resources Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 93 (better than 93% compared with alternatives) for 2023, New Jersey Resources 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 New Jersey Resources. Profit Growth has a rank of 64 which means that currently professionals expect the company to grow its profits more than 64% of its competitors. The same is valid for capital growth and stock returns. Capital Growth has a rank of 89, and Stock Returns has a rank of 97 which means that the stock returns have recently been above 97% of alternative investments. Only revenue growth is low with a Sales Growth has a rank of 22 (78% of its competitors are better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 93, is a BUY recommendation for growth and momentum investors. The many positive growth indicators indicate a positive growth momentum with only low revenue growth. That can also be attributed to divestments or the sale of unprofitable businesses. If that is the reason, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: New Jersey Resources Debt Financing Safety above-average
| SAFETY METRICS | May 25, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 32 |
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| REFINANCING | ||||||||
| REFINANCING | 61 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 82 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 73 |
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ANALYSIS: With an Obermatt Safety Rank of 73 (better than 73% compared with alternatives), the company New Jersey Resources 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 New Jersey Resources 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, with two out of three indicators above-average for New Jersey Resources. Refinancing is at 61, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 61% of its competitors. Liquidity is also good at 82, meaning the company generates more profit to service its debt than 82% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 32, which means the company has an above-average debt-to-equity ratio. It has more debt than 68% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 73 (better than 73% compared with alternatives), New Jersey Resources has a financing structure that is safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and New Jersey Resources could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. ...read more
Combined financial peformance: New Jersey Resources Top Financial Performance
| COMBINED PERFORMANCE | May 25, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 38 |
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| GROWTH | ||||||||
| GROWTH | 93 |
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| SAFETY | ||||||||
| SAFETY | 82 |
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| COMBINED | ||||||||
| COMBINED | 88 |
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ANALYSIS: With an Obermatt Combined Rank of 88 (better than 88% compared with investment alternatives), New Jersey Resources (Gas Utilities, USA) shares have much better financial characteristics than comparable stocks. Shares of New Jersey Resources are low in value (priced high) with a consolidated Obermatt Value Rank of 38 (worse than 62% of alternatives). But they show above-average growth (Growth Rank of 93) and are safely financed (Safety Rank of 73, which means below-average debt burdens). ...read more
RECOMMENDATION: An Obermatt Combined Rank of 88, is a strong buy recommendation based on New Jersey Resources's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company New Jersey Resources exhibits low value (Obermatt Value Rank of 38), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 93). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 73) 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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