September 7, 2023
Top 10 Stock Scales 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: Scales – Top 10 Stock in SDG 6: Clean Water and Sanitation
Scales is listed as a top 10 stock on September 07, 2023 in the market index SDG 6 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° View of 45 (45% performer), Obermatt assesses an overall hold recommendation for Scales on September 07, 2023.
Snapshot: Obermatt Ranks
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 Scales Hold
| 360 METRICS | September 7, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 53 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 25 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 70 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 47 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 45 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 45 (better than 45% compared with alternatives), overall professional sentiment and financial characteristics for the stock Scales are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Scales. The consolidated Value Rank has an attractive rank of 53, which means that the share price of Scales is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 53% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 70. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 47. Professional investors are more confident in 53% other stocks. The consolidated Growth Rank also has a low rank of 25, 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. 75 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 45, Scales is worse than 55% 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 53), and the financing structure is on the safer side (Safety Rank of 70). However, sentiment in the professional investor community is below-average (Sentiment Rank of 47), as is the growth momentum for the company (Growth Rank of 25). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. 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 Scales only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 47 (better than 47% compared with alternatives), overall professional sentiment and engagement for the stock Scales is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Scales. Analyst Opinions are at a rank of 62 (better than 62% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. In addition, Analyst Opinions Change has a rank of 50, which means that currently, stock research experts are getting even more optimistic. Obermatt Market Pulse further supports this with a rank of 91, which means that the current professional news and professional social networks are generally positive when discussing this company (more positive news than for 91% of competitors). But there are few stock holdings by institutional investors. The Professional Investors rank is low at 15, which means that currently, professional investors hold less stock in this company than in 85% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 47 (less encouraging than 53% compared with investment alternatives), Scales has a reputation among professional investors that is below that of its competitors. Not having too many professionals invested in Scales may be less of an issue, especially if the stock is from a smaller company where professionals typically invest less. It is natural for professional investors to focus on large and extra-large companies, as they provide more safety. Smaller companies attract fewer professionals in the shareholder community. Overall, the signals from the professionals are still quite favorable for investments in Scales. ...read more
Value Strategy: Scales Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 53 (better than 53% compared with alternatives), Scales shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Scales. Expected dividend yields are higher than for 85% of comparable companies (a Dividend Yield rank of 85), 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 58, which means that the stock price is lower compared with invested capital than for 58% of comparable investments. But in respect to sales and profits, the picture is reversed. Price-to-Sales is 45 which means that the stock price compared with what market professionals expect for future profits is higher than for 55% of comparable companies, indicating a low value concerning Scales's sales levels. The Price-to-Profit ratio (also referred to as price-earnings (P/E) ratio) is also unfavorable for Scales with a rank of 45. This means that the stock price, compared with what market professionals expect for future profits, is higher than for 55% of comparable companies, indicating a low value concerning Scales's profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 53, is a buy recommendation based on Scales'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, Scales 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: Scales Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 25 (better than 25% compared with alternatives), Scales 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 half of the indicators below and half above average for Scales. Sales Growth has a rank of 86 which means that currently, professionals expect the company to grow more than 86% of its competitors. Capital Growth is also above 18% of competitors with a rank of 67. But Profit Growth only has a rank of 18, which means that currently professionals expect the company to grow its profits less than 82% of its competitors. And Stock Returns have also been below average with a rank of only 7. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 25, is a hold recommendation for growth and momentum investors. Profits are sometimes low if the company invests in the future. The positive revenue and capital investment outlook confirms such an interpretation. Both revenues and capital are solid growth indicators, and lower profits in such a case would be encouraging. But the investors see it differently by punishing the share price. Sometimes, Mister Market is not very reliable, because it is not uncommon for it to be volatile. Investors should look out for signs of growth expenditure that could justify low profit growth, and they may also find reasons why recent stock price developments don't confirm the growth outlook of operations. While operating growth indicators are not perfect, they are more reliable indicators for future performance than stock prices that can repeatedly surprise investors. ...read more
Safety Strategy: Scales Debt Financing Safety above-average
| SAFETY METRICS | September 7, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 62 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 70 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 43 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 70 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 70 (better than 70% compared with alternatives), the company Scales 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 Scales 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 two out of three are above average for Scales.Leverage is at 62, meaning the company has a below-average debt-to-equity ratio. It has less debt than 62% of its competitors.Refinancing is at a rank of 70, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 70% of its competitors. Liquidity is at 43, meaning that the company generates less profit to service its debt than 57% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 70 (better than 70% compared with alternatives), Scales has a financing structure that is safer than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. ...read more
Combined financial peformance: Scales Above-Average Financial Performance
| COMBINED PERFORMANCE | September 7, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 53 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 25 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 43 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 53 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 53 (better than 53% compared with investment alternatives), Scales (Agricultural Products, New Zealand) shares have above-average financial characteristics compared with similar stocks. Shares of Scales are a good value (attractively priced) with a consolidated Value Rank of 53 (better than 53% of alternatives), are safely financed (Safety Rank of 70, which means low debt burdens), but show below-average growth (Growth Rank of 25). ...read more
RECOMMENDATION: A Combined Rank of 53, is a buy recommendation based on Scales's financial characteristics. As the company Scales's key financial metrics exhibit good value (Obermatt Value Rank of 53) but low growth (Obermatt Growth Rank of 25) while being safely financed (Obermatt Safety Rank of 70), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 53% 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
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.