Fact based stock research
Ricardo (LSE:RCDO)
GB0007370074
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.
Ricardo stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 23 (worse than 77% compared with investment alternatives), Ricardo (Research & Consulting, United Kingdom) shares have lower financial characteristics compared with similar stocks. Shares of Ricardo are low in value (priced high) with a consolidated Value Rank of 49 (worse than 51% of alternatives) and show below-average growth (Growth Rank of 20) but are safely financed (Safety Rank of 57), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 23, is a sell recommendation based on Ricardo's financial characteristics. As the company Ricardo's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 49) and low growth (Obermatt Growth Rank of 20), 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 57) 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 lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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360° Viewnew| Country | United Kingdom |
| Industry | Research & Consulting |
| Index | FTSE All Shares |
| Size class | Medium |
18-Apr-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.
It’s easier said than done. When your stock drops, it’s easy to want to sell it and find a better performer. Think twice, or even three times, before trading. Those fees (especially the hidden ones) can eat up your gains.
Review the performance ranks of the individual metrics that form each investment strategy.
Research History: Ricardo
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 38 |
|
44 |
|
37 |
|
49 |
|
| GROWTH | ||||||||
| GROWTH | 88 |
|
8 |
|
54 |
|
20 |
|
| SAFETY | ||||||||
| SAFETY | 35 |
|
62 |
|
48 |
|
57 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
50 |
|
26 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
28 |
|
30 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 23 (worse than 77% compared with investment alternatives), Ricardo (Research & Consulting, United Kingdom) shares have lower financial characteristics compared with similar stocks. Shares of Ricardo are low in value (priced high) with a consolidated Value Rank of 49 (worse than 51% of alternatives) and show below-average growth (Growth Rank of 20) but are safely financed (Safety Rank of 57), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 23, is a sell recommendation based on Ricardo's financial characteristics. As the company Ricardo's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 49) and low growth (Obermatt Growth Rank of 20), 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 57) 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 lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 38 |
|
44 |
|
37 |
|
49 |
|
| GROWTH | ||||||||
| GROWTH | 88 |
|
8 |
|
54 |
|
20 |
|
| SAFETY | ||||||||
| SAFETY | 35 |
|
62 |
|
48 |
|
57 |
|
| COMBINED | ||||||||
| COMBINED | 20 |
|
24 |
|
39 |
|
23 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 49 (worse than 51% compared with alternatives), Ricardo shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Ricardo. Price-to-Profit (also referred to as price to earnings, P/E ratio) is 54 which means that the stock price compared with what market professionals expect for future profits is lower than for 54% of comparable companies, indicating a good value concerning Ricardo's profit levels. The same is valid for the expected Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 69, and for Dividend Yield with a Dividend Yield Rank of 50. But, compared with other companies in the same industry, the stock price is higher than average as regards expected revenues; only 51% of all competitors have an even higher stock price as regards to sales revenues (a Price-to-Sales Rank of 49). Profits, the level of invested capital, and dividend policy suggest that this stock is attractively priced. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 49, is a hold recommendation based on Ricardo's stock price compared with the company's operational size and dividend yields. Since it is on the expensive side for Price-to-Sales, it may mean that Ricardo has pricing power in its distribution market because it can charge higher prices than its competitors. If this is the case, all four value indicators are positive signals for purchasing Ricardo shares. 9. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision. ...read more
| VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| PRICE VS. REVENUES (P/S) | ||||||||
| PRICE VS. REVENUES (P/S) | 69 |
|
45 |
|
47 |
|
49 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 24 |
|
62 |
|
37 |
|
54 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 76 |
|
73 |
|
67 |
|
69 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 54 |
|
32 |
|
44 |
|
50 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 38 |
|
44 |
|
37 |
|
49 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 20 (better than 20% compared with alternatives), Ricardo 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 all four metrics below average for Ricardo. Sales Growth has a rank of 49, which means that currently professionals expect the company to grow less than 51% of its competitors. The same is valid for Profit Growth, with a rank of 37, and Capital Growth with 38. In addition, Stock Returns have a below market rank of 14, which means that the stock returns have recently been below 86% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 20, is a sell recommendation for growth and momentum investors. These are all bad growth momentum indicators. These are negative signals for investors interested in growth companies. Value is likely good for this company, as investors may have left this stock in the cold. If that is the case, investors should look at the company's outlook, especially Sentiment performance, because it may be a turnaround situation that could entail above-average stock returns in the future. But it remains a risky bet, as no growth signals are in the green zone yet. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is low here. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 54 |
|
43 |
|
64 |
|
49 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 20 |
|
20 |
|
26 |
|
37 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
16 |
|
59 |
|
38 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 76 |
|
50 |
|
36 |
|
14 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 88 |
|
8 |
|
54 |
|
20 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 57 (better than 57% compared with alternatives), the company Ricardo 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 Ricardo 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 just one indicator above average for Ricardo and the other two below average. Refinancing is at 88, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 88% of its competitors. But Leverage is high with a rank of 44, meaning the company has an above-average debt-to-equity ratio. It has more debt than 56% of its competitors. Liquidity is also on the riskier side with a rank of 26, meaning the company generates less profit to service its debt than 74% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 57 (better than 57% compared with alternatives), Ricardo has a financing structure that is safer than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Ricardo are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. In the long-term, investors may have a debt challenge with Ricardo and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 24 |
|
57 |
|
43 |
|
44 |
|
| REFINANCING | ||||||||
| REFINANCING | 76 |
|
84 |
|
82 |
|
88 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 45 |
|
24 |
|
16 |
|
26 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 35 |
|
62 |
|
48 |
|
57 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
69 |
|
59 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
50 |
|
50 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
18 |
|
14 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
61 |
|
34 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
50 |
|
26 |
|
new |
|
Stock analysis by the purely fact based Obermatt Method for Ricardo from April 18, 2024.
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