August 31, 2023
Top 10 Stock Regal Beloit 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: Regal Beloit – Top 10 Stock in Water Technology
Regal Beloit is listed as a top 10 stock on August 31, 2023 in the market index Water Tech because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. While the company shows high growth, the stock price is high yet professional investor sentiment is low, which may be due to overly optimistic investor behavior, reflected in a low stock price value. Based on the Obermatt 360° View of 82 (top 82% performer), Obermatt assesses an overall strong buy recommendation for Regal Beloit on August 31, 2023.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Electr. Components & Equipment |
| Index | Dividends USA, Water Tech, S&P MIDCAP |
| Size class | X-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 Regal Beloit Strong Buy
| 360 METRICS | August 31, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 49 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 77 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 82 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 49 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 82 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 82 (better than 82% compared with alternatives) for 2023, overall professional sentiment and financial characteristics for the stock Regal Beloit are very positive. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Regal Beloit. The consolidated Growth Rank has a good rank of 77, 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 77% of competitors in the same industry. In addition, the consolidated Safety Rank has a safer rank of 82 which means that the company has a financing structure that is safer than 82% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the consolidated Value Rank has a less desirable rank of 49 which means that the share price of Regal Beloit is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is higher than for 51% of alternative stocks in the same industry. The consolidated Sentiment Rank also has a low rank of 49, which means that professional investors are more pessimistic about the stock than for 51% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 82, Regal Beloit is better positioned than 82% of all alternative stock investment opportunities based on the Obermatt Method. As only half of the consolidated Obermatt Ranks exhibit excellent performance, the picture is ambiguous. Growth is above-average (Growth Rank of 77), and the company is safely financed (Safety Rank of 82). However, professional market sentiment is low(Sentiment Rank of 49). The negative market view on Regal Beloit may be due to the high stock price (low value). A growth company like this may get too expensive at one point in time. If too many investors are desperate to board the train, they may drive stock prices above reasonable levels. It is typical for growth companies to have low value ratings, because investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of Regal Beloit compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one hundred minus the growth 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 value rank is above 60. As market sentiment is low, you should be careful with paying more than market-average for this stock and conduct further research into the company’s future growth potential. ...read more
Sentiment Strategy: Professional Market Sentiment for Regal Beloit only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 49 (better than 49% compared with alternatives), overall professional sentiment and engagement for the stock Regal Beloit is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Regal Beloit. Analyst Opinions are at a rank of 81 (better than 81% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. This is a good sign, were it not for Analyst Opinions Change with a low rank of 25, which means that currently, stock research experts are changing their opinions for the worse. In other words, they are getting more critical of a stock investment in Regal Beloit. The Professional Investors rank is also low at 45, meaning that professional investors hold less stock in this company than in 55% of alternative investment opportunities. Pros tend to invest in other companies. Even worse, Market Pulse has a low rank of 44, which means that the current professional news and professional social networks are critical of this company (more negative news than for 56% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 49 (less encouraging than 51% compared with investment alternatives), Regal Beloit has a reputation among professional investors that is below that of its competitors. There are several negative sentiment signals, with only the Analyst Opinions Rank above average. This could be a stock with a long reputation for being positive but where things are worsening. Most analysts may not see it yet, but some have, and the professionals are already quite pessimistic. Proceed with caution when investing in this stock. ...read more
Value Strategy: Regal Beloit Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 49 (worse than 51% compared with alternatives), Regal Beloit shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Regal Beloit. Expected dividend yields are higher than for 73% of comparable companies (a Dividend Yield rank of 73), making the stock attractive. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 65, which means that the stock price is lower compared with invested capital than for 65% of comparable investments. But in respect to sales and profits, the picture is reversed. Price-to-Sales is 48 which means that the stock price compared with what market professionals expect for future profits is higher than for 52% of comparable companies, indicating a low value concerning Regal Beloit's sales levels. The Price-to-Profit ratio (also referred to as price-earnings (P/E) ratio) is also unfavorable for Regal Beloit with a rank of 16. This means that the stock price, compared with what market professionals expect for future profits, is higher than for 84% of comparable companies, indicating a low value concerning Regal Beloit's profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 49, is a hold recommendation based on Regal Beloit's stock price compared with the company's operational size and dividend yields. The company seems confident that it can generate a reasonable return on invested capital, because it pays an above-average dividend while profits are below what you would expect for a company with this stock price. If you agree with this practice and believe that profits will return to higher levels, as the current dividend policy suggests, Regal Beloit may be an attractive investment. If this is not the case, you may want to be careful with this stock as it is also expensive compared with its expected revenue levels. ...read more
Growth Strategy: Regal Beloit Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 77 (better than 77% compared with alternatives) for 2023, Regal Beloit 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 but one indicator above average for Regal Beloit. Sales Growth has a rank of 62 which means that currently, professionals expect the company to grow more than 62% of its competitors. Capital Growth is also above 42% of competitors with a rank of 67, and Stock Returns with the rank of 75 is also an outperformance. Only Profit Growth is low with a rank of 42 which means that currently, professionals expect the company to grow its profits less than 58% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 77, is a buy recommendation for growth and momentum investors. All three operating growth indicators, namely revenue, profit, and capital growth, are showing improvements. This is a good indication of a company with a positive future. That might, at the same time, be the simple reason why profit growth is low. A growing company needs money and thus can't yet show high profit growth. Look out for signs in corporate communication about extra growth efforts costing time and money. If that is the case, Regal Beloit is a good growth stock. ...read more
Safety Strategy: Regal Beloit Debt Financing Safety very solid
| SAFETY METRICS | August 31, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 57 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 44 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 77 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 82 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 82 (better than 82% compared with alternatives) for 2023, the company Regal Beloit has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Regal Beloit 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 Regal Beloit. Leverage is at a rank of 57, meaning the company has a below-average debt-to-equity ratio. It has less debt than 57% 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 44, 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 56% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 82 (better than 82% compared with alternatives), Regal Beloit 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 Regal Beloit. 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: Regal Beloit Top Financial Performance
| COMBINED PERFORMANCE | August 31, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 49 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 77 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 77 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 95 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 95 (better than 95% compared with investment alternatives), Regal Beloit (Electr. Components & Equipment, USA) shares have much better financial characteristics than comparable stocks. Shares of Regal Beloit are low in value (priced high) with a consolidated Value Rank of 49 (worse than 51% of alternatives). But they show above-average growth (Growth Rank of 77) and are safely financed (Safety Rank of 82, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 95, is a strong buy recommendation based on Regal Beloit's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Regal Beloit exhibits low value (Obermatt Value Rank of 49), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 77). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 82) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.