September 21, 2023
Top 10 Stock OCBC Group 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: OCBC Group – Top 10 Stock in Straits Times Index STI
OCBC Group is listed as a top 10 stock on September 21, 2023 in the market index STI because of its high performance in at least one of the Obermatt investment strategies. As all consolidated Obermatt Ranks exhibit excellent performance, including positive market sentiment in the professional investor community, it is a solid stock investment where the risk of paying too much for the shares is limited. Based on the Obermatt 360° View of 91 (top 91% performer), Obermatt assesses an overall strong buy recommendation for OCBC Group on September 21, 2023.
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 OCBC Group Strong Buy
| 360 METRICS | September 21, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 69 |
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| GROWTH | ||||||||
| GROWTH | 59 |
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| SAFETY | ||||||||
| SAFETY | 98 |
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| SENTIMENT | ||||||||
| SENTIMENT | 73 |
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| 360° VIEW | ||||||||
| 360° VIEW | 91 |
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ANALYSIS: With an Obermatt 360° View of 91 (better than 91% compared with alternatives) for 2023, overall professional sentiment and financial characteristics for the stock OCBC Group are very positive. The 360° View is based on consolidating four consolidated indicators, with all four indicators above average for OCBC Group. The consolidated Value Rank has an attractive rank of 69, which means that the share price of OCBC Group is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 69% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 59, 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. The company is also safely financed with a Safety rank of 98. Finally, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 73. ...read more
RECOMMENDATION: With a consolidated 360° View of 91, OCBC Group is better positioned than 91% of all alternative stock investment opportunities based on the Obermatt Method. As all consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 69), above-average growth (Growth Rank of 59), safe financing practices (Safety Rank of 98), and a positive market sentiment in the professional investor community (Sentiment Rank of 73), it is a solid stock investment where the risk of paying too much for the shares is limited and disappointments are less likely to occur, unless information not publicly available. High-Value Ranks sometimes indicate that the company's future is challenging. If they are safely financed and have above average growth, and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of OCBC Group is as difficult as the stock’s low price, despite what good growth and safe financing practice suggest. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible, which may indicate good timing right now. ...read more
Sentiment Strategy: Professional Market Sentiment for OCBC Group positive
ANALYSIS: With an Obermatt Sentiment Rank of 73 (better than 73% compared with alternatives), overall professional sentiment and engagement for the stock OCBC Group is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for OCBC Group. Analyst Opinions are at a rank of 62 (better than 62% 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 74, 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 OCBC Group. Finally, the Professional Investors rank is 67, which means that currently, professional investors hold more stock in this company than in 67% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 73 (more positive than 73% compared with investment alternatives), OCBC Group has a reputation among professional investors that is above-average compared with 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 40, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 60% of competitors). This could mean future risks and should make investors careful. Attention to negative news for OCBC Group 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: OCBC Group Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 69 (better than 69% compared with alternatives), OCBC Group shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for OCBC Group. Price-to-Profit (also referred to as price-earnings, P/E) is 65 which means that the stock price compared with what market professionals expect for future profits is lower than for 65% of comparable companies, indicating a good value concerning OCBC Group'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, which means that the stock price is lower as regards to invested capital than for 44% of comparable investments. On the other hand, Price-to-Sales is less favorable than 67% of alternatives (only 33% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 15% 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 69, is a buy recommendation based on OCBC Group's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. ...read more
Growth Strategy: OCBC Group Growth Momentum good
| GROWTH METRICS | September 21, 2023 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 31 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 68 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 71 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 47 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 59 |
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ANALYSIS: With an Obermatt Growth Rank of 59 (better than 59% compared with alternatives), OCBC Group 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, where half of the indicators are below and half above average for OCBC Group. Profit Growth, with a rank of 68 (better than 68% of its competitors), and Capital Growth, with a rank of 71, are both positive, which is a healthy sign for positive development. But Sales Growth has only a rank of 31, which means that, currently, professionals expect the company to grow less than 69% of its competitors, and Stock Returns are at a rank of 47. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 59, is a buy recommendation for growth and momentum investors. Stock returns that are a thing of the past can be less of a problem. Below-average revenue growth may be caused by divestments of underperforming businesses. If that is the case, then the positive developments of profit and capital growth are signs of a company with growth potential. If these are the reasons, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: OCBC Group Debt Financing Safety very solid
| SAFETY METRICS | September 21, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 80 |
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| REFINANCING | ||||||||
| REFINANCING | 55 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 96 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 98 |
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ANALYSIS: With an Obermatt Safety Rank of 98 (better than 98% compared with alternatives) for 2023, the company OCBC Group has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of OCBC Group 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 all three are above average for OCBC Group. Leverage is at 80, meaning the company has a below-average debt-to-equity ratio. It has less debt than 80% of its competitors. Refinancing is at a rank of 55, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 55% of its competitors. Finally, Liquidity is also good at a rank of 96, which means that the company generates more profit to service its debt than 96% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 98 (better than 98% compared with alternatives), OCBC Group has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more
Combined financial peformance: OCBC Group Top Financial Performance
| COMBINED PERFORMANCE | September 21, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 69 |
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| GROWTH | ||||||||
| GROWTH | 59 |
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| SAFETY | ||||||||
| SAFETY | 96 |
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| COMBINED | ||||||||
| COMBINED | 91 |
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ANALYSIS: With an Obermatt Combined Rank of 91 (better than 91% compared with investment alternatives), OCBC Group (Diversified Banks, Singapore) shares have much better financial characteristics than comparable stocks. Shares of OCBC Group are a good value (attractively priced) with a consolidated Value Rank of 69 (better than 69% of alternatives), show above-average growth (Growth Rank of 59), and are safely financed (Safety Rank of 98), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 91, is a strong buy recommendation based on OCBC Group's financial characteristics. As the company OCBC Group's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 69), above-average growth (Obermatt Growth Rank of 59), and indicate that the company is safely financed (Obermatt Safety Rank of 98), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of OCBC Group. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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