May 25, 2023
Top 10 Stock Vedanta 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: Vedanta – Top 10 Stock in Copper Mining and Production
Vedanta is listed as a top 10 stock on May 25, 2023 in the market index Copper 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 below average and thus a signal for caution. Based on the Obermatt 360° View of 46 (46% performer), Obermatt assesses an overall hold recommendation for Vedanta on May 25, 2023.
Snapshot: Obermatt Ranks
| Country | India |
| Industry | Diversified Metals & Mining |
| Index | Low Emissions, Copper, Energy Efficient, Good Governace Growth Markets, Iron, Lithium, Low Waste, Zinc, Rare Earth, Recycling, Silver, Uranium, Water Efficiency |
| 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° Assessment Vedanta Hold
| 360 METRICS | May 25, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 69 |
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| GROWTH | ||||||||
| GROWTH | 69 |
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| SAFETY | ||||||||
| SAFETY | 10 |
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| SENTIMENT | ||||||||
| SENTIMENT | 35 |
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| 360° VIEW | ||||||||
| 360° VIEW | 46 |
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ANALYSIS: With an Obermatt 360° View of 46 (better than 46% compared with alternatives), overall professional sentiment and engagement for the stock Vedanta are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Vedanta. The consolidated Value Rank has an attractive rank of 69, which means that the share price of Vedanta is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 69% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 69, 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. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 35. Professional investors are more confident in 65% other stocks. Worryingly, the company has risky financing, with a Safety rank of 10. This means 90% of comparable companies have a safer financing structure than Vedanta. ...read more
RECOMMENDATION: With a 360° View of 46, Vedanta is worse than 54% of all alternative stock investment opportunities based on the Obermatt Method. Even though half of the consolidated Obermatt Ranks are above-average, namely the Value Rank at 69 and the Growth Rank above-average at 69, the picture is still mixed. The professional investor community is skeptical, with the Sentiment Rank below-average at 35. In addition, the company financing structure is on the riskier side (Safety Rank of 10). While everybody wants to buy at low stock prices (good value), there may be a good reason why Vedanta's share price is low, namely because professionals are skeptical. One may be tempted by above-average growth, but that could also change quickly, as past performance is not a good indicator of future performance. Since the financing structure is on the risky side, investors should 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 Vedanta only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 35 (better than 35% compared with alternatives), overall professional sentiment and engagement for the stock Vedanta is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Vedanta. Analyst Opinions are at a rank of 38 (worse than 62% 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 54, which means that stock research experts have found something to make them more positive about investing in the company. In other words, they are getting more optimistic of stock investments in Vedanta. But the Professional Investors rank is low at 47, which means that professional investors hold less stock in this company than in 53% of alternative investment opportunities. Pros tend to invest in other companies. Market Pulse is also low at a rank of 17, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 83% of competitors). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 35 (less encouraging than 65% compared with investment alternatives), Vedanta has a reputation among professional investors that is below that of its competitors. These are quite a few negative sentiment signals. One may want to trust the analysts that are changing their opinions. They may be early indications of better times, especially if the company is a smaller one. But If they are an extra large company, they should have more professional stockholders than are currently present. ...read more
Value Strategy: Vedanta Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 69 (better than 69% compared with alternatives), Vedanta shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Vedanta. Price-to-Sales (P/S) is 68, which means that the stock price compared with what market professionals expect for future sales is lower than for 68% of comparable companies, indicating a good value concerning Vedanta's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 69% of alternatives. Finally, it is true for expected dividend yields with an Dividend Yield rank of 98 (dividends are expected to be higher than 98% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 54% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Vedanta to 46. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 69, is a BUY recommendation based on Vedanta's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner in assets than its competitors. For instance, the company could be leasing its production facilities or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the three good value ranks for Sales, Profits, and Dividends are reliable indicators for the stock price value. ...read more
Growth Strategy: Vedanta Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 69 (better than 69% compared with alternatives), Vedanta shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Vedanta. Profit Growth has a rank of 68, which means that currently professionals expect the company to grow its profits more than 68% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 79 (above 79% of alternative investments). But Sales Growth has a below the median rank of 40, which means that, currently, professionals expect the company to grow less than 60% of its competitors, and Capital Growth also has a lower rank of 37. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 69, is a BUY recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for Vedanta. ...read more
Safety Strategy: Vedanta Debt Financing Safety risky
| SAFETY METRICS | May 25, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 6 |
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| REFINANCING | ||||||||
| REFINANCING | 3 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 54 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 10 |
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ANALYSIS: With an Obermatt Safety Rank of 10 (better than 10% compared with alternatives), the company Vedanta 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 Vedanta 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 just one indicator above average for Vedanta. Liquidity is at 54, meaning the company generates more profit to service its debt than 54% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 3, 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 97% of its competitors. Leverage is also high at a rank of 6, which means that the company has an above-average debt-to-equity ratio. It has more debt than 94% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 10 (worse than 90% compared with alternatives), Vedanta has a financing structure that is significantly riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usuallyl indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. ...read more
Combined financial peformance: Vedanta Below-Average Financial Performance
| COMBINED PERFORMANCE | May 25, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 69 |
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| GROWTH | ||||||||
| GROWTH | 69 |
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| SAFETY | ||||||||
| SAFETY | 54 |
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| COMBINED | ||||||||
| COMBINED | 46 |
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ANALYSIS: With an Obermatt Combined Rank of 46 (worse than 54% compared with investment alternatives), Vedanta (Diversified Metals & Mining, India) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Vedanta are a good value (attractively priced) with a consolidated Obermatt Value Rank of 69 (better than 69% of alternatives), show above-average growth (Growth Rank of 69) but are riskily financed (Safety Rank of 10), which means above-average debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 46, is a hold recommendation based on Vedanta's financial characteristics. As the company Vedanta's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 69) and above-average growth (Obermatt Growth Rank of 69), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 10) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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