May 11, 2023
Top 10 Stock Rayonier 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: Rayonier – Top 10 Stock in Wood & Timber Industry
Rayonier 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. Only one consolidated Obermatt Rank is above-average. The company is safely financed, but all other facts speak against a stock purchase, especially the low market sentiment by professional investors. Based on the Obermatt 360° Rank of 45 (45% performer), Obermatt assesses an overall hold recommendation for Rayonier on May 11, 2023.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | REITs: Specialized |
| Index | R/E USA, Timber Industry, 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 Rayonier Hold
| 360 METRICS | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 20 |
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| GROWTH | ||||||||
| GROWTH | 39 |
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| SAFETY | ||||||||
| SAFETY | 92 |
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| SENTIMENT | ||||||||
| SENTIMENT | 44 |
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| 360° VIEW | ||||||||
| 360° VIEW | 45 |
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ANALYSIS: With an Obermatt 360° Rank of 45 (better than 45% compared with alternatives), overall professional sentiment and engagement for the stock Rayonier are below the industry average. The 360° Rank is based on consolidating four consolidated indicators, with three out of four metrics below average for Rayonier. The only rank that is above average is the consolidated Safety Rank at 92, which means that the company has a financing structure that is safer than 92% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the Value, Growth and Sentiment Ranks are all below average. The consolidated Value Rank has a less desirable rank of 20, which means that the share price of Rayonier is on the high side compared with typical size in indicators such as revenues, profits, and invested capital. The consolidated Growth Rank also has a low rank of 39, which implies that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. Finally, the consolidated Sentiment Rank is also low at a rank of 44, which means that professional investors are more pessimistic about the stock than for 56% of alternative investment opportunities. While Safety is strong, it’s not the most critical indicator, so we suggest proceeding with caution if you are considering this stock. ...read more
RECOMMENDATION: With a 360° Rank of 45, Rayonier is worse than 55% of all alternative stock investment opportunities based on the Obermatt Method. As only the financing structure, namely the Safety Rank, is on the safer side and all other consolidated Obermatt Ranks are below-average, this is a riskier stock investment proposition. This is especially the case, since professional investor sentiment, the consolidated Obermatt Sentiment Rank, is also low at 44. The negative market view on Rayonier may be the high stock price (low value) or the low level of growth. This is a problem. As the Safety Rank is the least important of the four, we cannot identify enough positive facts that are visible today to make a case for this stock investment. The company may have a strong future which would justify the high stock price, but this is not visible from investor behavior today. As market sentiment is critical, you should be careful with paying more than market-average for this stock, and conduct further research into the company's future growth potential. Prudent investors may only want to invest a smaller portion of their wealth in such situations. Young investors can carry more risk but should still thrive for sufficient diversification. ...read more
Sentiment Strategy: Professional Market Sentiment for Rayonier only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 44 (better than 44% compared with alternatives), overall professional sentiment and engagement for the stock Rayonier is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the indicators below and above average for Rayonier. Analyst Opinions are at a rank of 11 (worse than 89% 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 changing their opinions for the better. In other words, they are getting more optimistic of stock investments in Rayonier. Market Pulse is also positive with a rank of 67, which means that the current professional news and professional social networks are positive in their discussions about this company (more positive news than for 67% of competitors). Only professional investors tend to be absent with a Professional Investors rank of 44, which means that professional investors hold less stock in this company than in 56% of alternative investment opportunities. Pros tend to invest in other companies. But that could also be due to the size of the company. Professional investors tend to invest in XL and XXL companies. If the company is smaller than that, that fact alone may explain why there are fewer pros present. ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 44 (less encouraging than 56% compared with investment alternatives), Rayonier has a reputation among professional investors that is below that of its competitors. Since analysts are getting more optimistic and the professional communication channels are positive, it may be an indication of a company that has the difficult times behind it or is getting less expensive for what they are. For medium to smaller companies, the positive sentiment indicators outshine the negative. ...read more
Value Strategy: Rayonier Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 20 (worse than 80% compared with alternatives), Rayonier shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, where the majority of metrics are below, and only one is above average for Rayonier. Price-to-Sales (P/S) has a value of 50, which means that the stock price compared with what market professionals expect for future sales is lower than 50% of comparable companies, indicating a good value concerning to Rayonier's revenue size. But all other performance indicators point in a different direction. Dividend yields have an Obermatt Dividend Yield rank of 40, meaning that dividends are expected to be lower than 60% of comparable investments. Furthermore, Price-to-Book Capital (also referred to as market-to-book ratio) is less favorable than 80% of alternatives (only 20% of peers have an even higher ratio). The same is valid for Price-to-Profit (or Price / Earnings, P/E), which is higher than 97% 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 20, is a SELL recommendation based on Rayonier'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 Rayonier 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. In other cases, Rayonier looks like an expensive investment today. ...read more
Growth Strategy: Rayonier Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 39 (better than 39% compared with alternatives), Rayonier 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, with three out of four indicators below average for Rayonier. Only Capital Growth has a good rank of 63, which means that currently professionals expect the company to grow its invested capital more than 38% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 45 which means that currently professionals expect the company to grow less than 55% of its competitors. Profit Growth with a rank of 38 and Stock Returns with a rank of 27 are also low (below 73% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 39, is a HOLD recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Rayonier is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. ...read more
Safety Strategy: Rayonier Debt Financing Safety very solid
| SAFETY METRICS | May 11, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 58 |
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| REFINANCING | ||||||||
| REFINANCING | 74 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 63 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 92 |
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ANALYSIS: With an Obermatt Safety Rank of 92 (better than 92% compared with alternatives) for 2023, the company Rayonier has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Rayonier 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 Rayonier. Leverage is at 58, meaning the company has a below-average debt-to-equity ratio. It has less debt than 58% of its competitors. Refinancing is at a rank of 74, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 74% of its competitors. Finally, Liquidity is also good at a rank of 63, which means that the company generates more profit to service its debt than 63% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 92 (better than 92% compared with alternatives), Rayonier 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: Rayonier Above-Average Financial Performance
| COMBINED PERFORMANCE | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 20 |
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| GROWTH | ||||||||
| GROWTH | 39 |
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| SAFETY | ||||||||
| SAFETY | 63 |
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| COMBINED | ||||||||
| COMBINED | 66 |
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ANALYSIS: With an Obermatt Combined Rank of 66 (better than 66% compared with investment alternatives), Rayonier (REITs: Specialized, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Rayonier are low in value (priced high) with a consolidated Obermatt Value Rank of 20 (worse than 80% of alternatives) and show below-average growth (Growth Rank of 39) but are safely financed (Safety Rank of 92), which means low debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 66, is a buy recommendation based on Rayonier's financial characteristics. As the company Rayonier's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 20) and low growth (Obermatt Growth Rank of 39), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 92) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be used in a limited number of investments that account for a small fraction of a safe portfolio. ...read more
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