February 15, 2024
Top 10 Stock Quanta Computer 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: Quanta Computer – Top 10 Stock in Recycling Leaders
Quanta Computer is listed as a top 10 stock on February 15, 2024 in the market index Recycling 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 70 (high 70% performer), Obermatt assesses an overall buy recommendation for Quanta Computer on February 15, 2024.
Snapshot: Obermatt Ranks
| Country | Taiwan |
| Industry | Technology Hardware & Peripherals |
| Index | Human Rights, Recycling, FTSE Taiwan |
| Size class | XX-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 Quanta Computer Buy
| 360 METRICS | February 15, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 47 |
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| GROWTH | ||||||||
| GROWTH | 100 |
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| SAFETY | ||||||||
| SAFETY | 4 |
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| SENTIMENT | ||||||||
| SENTIMENT | 79 |
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| 360° VIEW | ||||||||
| 360° VIEW | 70 |
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ANALYSIS: With an Obermatt 360° View of 70 (better than 70% compared with alternatives), overall professional sentiment and financial characteristics for the stock Quanta Computer are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Quanta Computer. The consolidated Growth Rank has a good rank of 100, 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 100% of competitors in the same industry. The consolidated Sentiment Rank also has a good rank of 79, which means that professional investors are more optimistic about the stock than for 79% of alternative investment opportunities. But the consolidated Value Rank has a less desirable rank of 47, which means that the share price of Quanta Computer 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 53% of alternative stocks in the same industry. Finally, the consolidated Safety Rank has a riskier rank of 4, which means that the company has a financing structure that is riskier than those of 96% 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 70, Quanta Computer is better positioned than 70% 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 100), and professional market sentiment is positive (Sentiment Rank of 79), 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 Quanta Computer very positive
ANALYSIS: With an Obermatt Sentiment Rank of 79 (better than 79% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Quanta Computer is very positive. The Sentiment Rank is based on consolidating four sentiment indicators where all but one are above average for Quanta Computer. Analyst Opinions are at a rank of 93 (better than 93% 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 65, which means that currently, professional investors hold more stock in this company than in 65% of alternative investment opportunities. Pros tend to favor investing in this company. In addition, Market Pulse has a rank of 75 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 75% of competitors). But Analyst Opinions Change has a below-average rank of 33, 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 Quanta Computer. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 79 (more positive than 79% compared with investment alternatives), Quanta Computer has a reputation among professional investors that is significantly higher than 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: Quanta Computer Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 47 (worse than 53% compared with alternatives), Quanta Computer shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half above average for Quanta Computer. Price-to-Sales (P/S) is 69, which means that the stock price compared with what market professionals expect for future sales is lower than for 69% of comparable companies, indicating a good value concerning Quanta Computer's revenue size. The same is valid for dividend yields with a Dividend Yield rank of 71, which means that dividends are expected to be higher than for 71% of comparable investments. On the other hand, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is less favorable than for 81% of alternatives (only 19% of peers have an even higher ratio). The same is valid for the Price-to-Profit (or Price / Earnings, P/E) ratio, which is higher than for 62% 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 47, is a hold recommendation based on Quanta Computer's stock price compared with the company's operational size and dividend yields. This is a somewhat surprising picture, because it means that profits are low while dividends are high. One interpretation could be that profits are expected to increase, justifying the high dividend payments. But it could also mean that the company desperately keeps the high dividends to avoid a collapsing share price. This would be a rather dangerous constellation. ...read more
Growth Strategy: Quanta Computer Growth Momentum high
| GROWTH METRICS | February 15, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 96 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 78 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 92 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 97 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 100 |
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ANALYSIS: With an Obermatt Growth Rank of 100 (better than 100% compared with alternatives) for 2024, Quanta Computer 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 four indicators above average for Quanta Computer. Sales Growth has a value of 96, which means that, currently, professionals expect the company to grow more than 96% of its competitors. The same is valid for Profit Growth with a value of 78 and for Capital Growth with 92. In addition, Stock Returns had an above-average rank value of 97, which means they have been higher than 97% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 100, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Quanta Computer exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. ...read more
Safety Strategy: Quanta Computer Debt Financing Safety risky
| SAFETY METRICS | February 15, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 1 |
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| REFINANCING | ||||||||
| REFINANCING | 22 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 18 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 4 |
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ANALYSIS: With an Obermatt Safety Rank of 4 (better than 4% compared with alternatives), the company Quanta Computer 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 Quanta Computer 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 Quanta Computer. Liquidity is at 18, meaning that the company generates less profit to service its debt than 82% 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 1, meaning the company has an above-average debt-to-equity ratio. It has more debt than 99% of its competitors. Finally, Refinancing is at a rank of 22 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 78% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 4 (worse than 96% compared with alternatives), Quanta Computer 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: Quanta Computer Below-Average Financial Performance
| COMBINED PERFORMANCE | February 15, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 47 |
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| GROWTH | ||||||||
| GROWTH | 100 |
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| SAFETY | ||||||||
| SAFETY | 18 |
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| COMBINED | ||||||||
| COMBINED | 41 |
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ANALYSIS: With an Obermatt Combined Rank of 41 (worse than 59% compared with investment alternatives), Quanta Computer (Technology Hardware & Peripherals, Taiwan) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Quanta Computer are low in value (priced high) with a consolidated Value Rank of 47 (worse than 53% of alternatives), and are riskily financed (Safety Rank of 4, which means above-average debt burdens) but show above-average growth (Growth Rank of 100). ...read more
RECOMMENDATION: A Combined Rank of 41, is a hold recommendation based on Quanta Computer's financial characteristics. As the company Quanta Computer shows low value with an Obermatt Value Rank of 47 (53% 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 100% of comparable companies (Obermatt Growth Rank is 100). 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 4 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 Quanta Computer, even a low-value company (in terms of its key financial indicators) can be a good investment. ...read more
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