May 11, 2023
Top 10 Stock PotlatchDeltic 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: PotlatchDeltic – Top 10 Stock in Wood & Timber Industry
PotlatchDeltic is listed as a top 10 stock on May 11, 2023 in the market index Timber Industry 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° Rank of 37 (37% performer), Obermatt assesses an overall hold recommendation for PotlatchDeltic on May 11, 2023.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | REITs: Specialized |
| Index | Dividends USA, Low Waste, R/E USA, Recycling, Timber Industry, NASDAQ, 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 PotlatchDeltic Hold
| 360 METRICS | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 56 |
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| GROWTH | ||||||||
| GROWTH | 11 |
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| SAFETY | ||||||||
| SAFETY | 71 |
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| SENTIMENT | ||||||||
| SENTIMENT | 45 |
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| 360° VIEW | ||||||||
| 360° VIEW | 37 |
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ANALYSIS: With an Obermatt 360° Rank of 37 (better than 37% compared with alternatives), overall professional sentiment and engagement for the stock PotlatchDeltic are below the industry average. The 360° Rank is based on consolidating four consolidated indicators, with half the metrics below and half above average for PotlatchDeltic. The consolidated Value Rank has an attractive rank of 56, which means that the share price of PotlatchDeltic is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 56% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 71. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 45. Professional investors are more confident in 55% other stocks. The consolidated Growth Rank also has a low rank of 11, 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. 89 of its competitors have better growth. ...read more
RECOMMENDATION: With a 360° Rank of 37, PotlatchDeltic is worse than 63% 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 56), and the financing structure is on the safer side (Safety Rank of 71). However, sentiment in the professional investor community is below-average (Sentiment Rank of 45), as is the growth momentum for the company (Growth Rank of 11). While everybody wants to buy at low stock prices (good value), professionals’ skepticism may mean that the low price is justified. 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 PotlatchDeltic only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 45 (better than 45% compared with alternatives), overall professional sentiment and engagement for the stock PotlatchDeltic is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators where all but one are above average for PotlatchDeltic. Analyst Opinions are at a rank of 54 (better than 54% 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 66, which means that currently, professional investors hold more stock in this company than in 66% of alternative investment opportunities. Pros tend to favor investing in this company. In addition, Market Pulse has a rank of 53 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 53% of competitors). But Analyst Opinions Change has a below-average rank of 11, 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 PotlatchDeltic. ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 45 (less encouraging than 55% compared with investment alternatives), PotlatchDeltic has a reputation among professional investors that is below 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: PotlatchDeltic Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 56 (better than 56% compared with alternatives), PotlatchDeltic shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for PotlatchDeltic. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 80% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales has a value of 40 which means that the stock price compared with what market professionals expect for future profits is higher than 60% of comparable companies, indicating a low value concerning PotlatchDeltic's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 29 which means that the stock price compared with what market professionals expect for future profit levels is higher than 71% of comparable companies. In addition, Price-to-Book Capital (also referred to as market-to-book ratio) with an Obermatt Price-to-Book Rank of 49 is also low. Compared with invested capital, the stock price is higher than for 51% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 56, is a BUY recommendation based on PotlatchDeltic's stock price compared with the company's operational size and dividend yields. Should dividend investors pick PotlatchDeltic? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose PotlatchDeltic only if they reasonably expect the low current profit levels to be transitory. ...read more
Growth Strategy: PotlatchDeltic Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 11 (better than 11% compared with alternatives), PotlatchDeltic 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 half of the indicators below and half above average for PotlatchDeltic. Sales Growth has a rank of 52 which means that currently professionals expect the company to grow more than 52% of its competitors. Stock Returns are also above average with a rank of 59. But Capital Growth has only a rank of 9, which means that currently professionals expect the company to grow its invested capital less than 86% of its competitors. Profit Growth is also low, with a rank of only 14, which means that, currently, professionals expect the company to grow its profits below average. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 11, is a SELL recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 59% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. ...read more
Safety Strategy: PotlatchDeltic Debt Financing Safety above-average
| SAFETY METRICS | May 11, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 64 |
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| REFINANCING | ||||||||
| REFINANCING | 46 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 77 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 71 |
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ANALYSIS: With an Obermatt Safety Rank of 71 (better than 71% compared with alternatives), the company PotlatchDeltic 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 PotlatchDeltic 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 PotlatchDeltic. Leverage is at a rank of 64, meaning the company has a below-average debt-to-equity ratio. It has less debt than 64% of its competitors. Liquidity is also good at a rank of 77, meaning the company generates more profit to service its debt than 77% 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 46, 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 54% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 71 (better than 71% compared with alternatives), PotlatchDeltic has a financing structure that is 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 PotlatchDeltic. 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: PotlatchDeltic Below-Average Financial Performance
| COMBINED PERFORMANCE | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 56 |
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| GROWTH | ||||||||
| GROWTH | 11 |
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| SAFETY | ||||||||
| SAFETY | 77 |
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| COMBINED | ||||||||
| COMBINED | 36 |
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ANALYSIS: With an Obermatt Combined Rank of 36 (worse than 64% compared with investment alternatives), PotlatchDeltic (REITs: Specialized, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of PotlatchDeltic are a good value (attractively priced) with a consolidated Obermatt Value Rank of 56 (better than 56% of alternatives), are safely financed (Safety Rank of 71, which means low debt burdens), but show below-average growth (Growth Rank of 11). ...read more
RECOMMENDATION: An Obermatt Combined Rank of 36, is a hold recommendation based on PotlatchDeltic's financial characteristics. As the company PotlatchDeltic's key financial metrics exhibit good value (Obermatt Value Rank of 56) but low growth (Obermatt Growth Rank of 11) while being safely financed (Obermatt Safety Rank of 71), it may be a safer investment because companies with low debt can better withstand times of crises. The good value, better than 56% 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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