March 7, 2024
Top 10 Stock Perpetual 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: Perpetual – Top 10 Stock in Australian Securities Exchange Index ASX 200
Perpetual is listed as a top 10 stock on March 07, 2024 in the market index ASX 200 because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 67 (high 67% performer), Obermatt assesses an overall buy recommendation for Perpetual on March 07, 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 Perpetual Buy
| 360 METRICS | March 7, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 71 |
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| GROWTH | ||||||||
| GROWTH | 44 |
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| SAFETY | ||||||||
| SAFETY | 83 |
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| SENTIMENT | ||||||||
| SENTIMENT | 21 |
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| 360° VIEW | ||||||||
| 360° VIEW | 67 |
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ANALYSIS: With an Obermatt 360° View of 67 (better than 67% compared with alternatives), overall professional sentiment and financial characteristics for the stock Perpetual are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Perpetual. The consolidated Value Rank has an attractive rank of 71, which means that the share price of Perpetual 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 71% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 83. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 21. Professional investors are more confident in 79% other stocks. The consolidated Growth Rank also has a low rank of 44, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 56 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 67, Perpetual is better positioned than 67% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 71), and the financing structure is on the safer side (Safety Rank of 83). However, sentiment in the professional investor community is below-average (Sentiment Rank of 21), as is the growth momentum for the company (Growth Rank of 44). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for Perpetual negative
ANALYSIS: With an Obermatt Sentiment Rank of 21 (better than 21% compared with alternatives), overall professional sentiment and engagement for the stock Perpetual is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half the indicators below and half above average for Perpetual. Analyst Opinions are at a rank of 47 (worse than 53% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 8, which means that stock research experts are getting even more pessimistic. In addition, the Professional Investors rank is 27, which means that professional investors hold less stock in this company than in 73% of alternative investment opportunities. Pros tend to invest in other companies. The only positive sentiment indicator for Perpetual is Market Pulse, with a rank of 70, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 70% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 21 (less encouraging than 79% compared with investment alternatives), Perpetual has a reputation among professional investors that is far below that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: Perpetual Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 71 (better than 71% compared with alternatives), Perpetual shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, where three out of four indicators are above average for Perpetual. Price-to-Sales (P/S) is 62 which means that the stock price compared with what market professionals expect for future sales is lower than for 62% of comparable companies, indicating a good value for Perpetual's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 55. Finally, compared with other companies in the same industry, dividend yields of Perpetual are expected to be higher than for 85% of all competitors (a Dividend Yield rank of 85). The only low rank is for expected profits with a Price-to-Profit Rank of 48, indicating that the market expects the company's profit to be low despite a high dividend. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 71, is a buy recommendation based on Perpetual's stock price compared with the company's operational size and dividend yields. The low Profit Rank could result from a one-off charge, for instance, for an accident, a legal settlement, or a restructuring project. If the company keeps its dividends high, the low expected profit may be transitory. If that is the case, the three good value ranks for Sales, Capital, and Dividends are reliable indicators for good stock price value, a low stock price. ...read more
Growth Strategy: Perpetual Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 44 (better than 44% compared with alternatives), Perpetual shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, where half of the indicators are below and half above average for Perpetual. Profit Growth, with a rank of 78 (better than 78% of its competitors), and Capital Growth, with a rank of 100, are both positive, which is a healthy sign for positive development. But Sales Growth has only a rank of 26, which means that, currently, professionals expect the company to grow less than 74% of its competitors, and Stock Returns are at a rank of 34. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 44, is a hold 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: Perpetual Debt Financing Safety very solid
| SAFETY METRICS | March 7, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 66 |
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| REFINANCING | ||||||||
| REFINANCING | 33 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 92 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 83 |
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ANALYSIS: With an Obermatt Safety Rank of 83 (better than 83% compared with alternatives) for 2024, the company Perpetual has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Perpetual 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 Perpetual. Leverage is at a rank of 66, meaning the company has a below-average debt-to-equity ratio. It has less debt than 66% of its competitors. Liquidity is also good at a rank of 92, meaning the company generates more profit to service its debt than 92% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 33, 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 67% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 83 (better than 83% compared with alternatives), Perpetual has a financing structure that is significantly safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Perpetual. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. ...read more
Combined financial peformance: Perpetual Top Financial Performance
| COMBINED PERFORMANCE | March 7, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 71 |
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| GROWTH | ||||||||
| GROWTH | 44 |
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| SAFETY | ||||||||
| SAFETY | 92 |
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| COMBINED | ||||||||
| COMBINED | 90 |
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ANALYSIS: With an Obermatt Combined Rank of 90 (better than 90% compared with investment alternatives), Perpetual (Asset Management & Custody, Australia) shares have much better financial characteristics than comparable stocks. Shares of Perpetual are a good value (attractively priced) with a consolidated Value Rank of 71 (better than 71% of alternatives), are safely financed (Safety Rank of 83, which means low debt burdens), but show below-average growth (Growth Rank of 44). ...read more
RECOMMENDATION: A Combined Rank of 90, is a strong buy recommendation based on Perpetual's financial characteristics. As the company Perpetual's key financial metrics exhibit good value (Obermatt Value Rank of 71) but low growth (Obermatt Growth Rank of 44) while being safely financed (Obermatt Safety Rank of 83), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 71% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. ...read more
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