Fact based stock research
Shoprite (JSE:SHP)
ZAE000012084
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.
Shoprite stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 37 (worse than 63% compared with investment alternatives), Shoprite (Food Retail, South Africa) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Shoprite are low in value (priced high) with a consolidated Value Rank of 43 (worse than 57% of alternatives), and are riskily financed (Safety Rank of 33, which means above-average debt burdens) but show above-average growth (Growth Rank of 67). ...read more
RECOMMENDATION: A Combined Rank of 37, is a hold recommendation based on Shoprite's financial characteristics. As the company Shoprite shows low value with an Obermatt Value Rank of 43 (57% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 67% of comparable companies (Obermatt Growth Rank is 67). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 33 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Shoprite, even a low-value company (in terms of its key financial indicators) can be a good investment. 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 | South Africa |
| Industry | Food Retail |
| Index | Low Emissions, Energy Efficient, JSE All Shares |
| Size class | X-Large |
This stock has achievements: Top 10 Stock.
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: Shoprite
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 43 |
|
63 |
|
37 |
|
43 |
|
| GROWTH | ||||||||
| GROWTH | 68 |
|
49 |
|
67 |
|
67 |
|
| SAFETY | ||||||||
| SAFETY | 55 |
|
31 |
|
26 |
|
33 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
33 |
|
61 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
39 |
|
44 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 37 (worse than 63% compared with investment alternatives), Shoprite (Food Retail, South Africa) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Shoprite are low in value (priced high) with a consolidated Value Rank of 43 (worse than 57% of alternatives), and are riskily financed (Safety Rank of 33, which means above-average debt burdens) but show above-average growth (Growth Rank of 67). ...read more
RECOMMENDATION: A Combined Rank of 37, is a hold recommendation based on Shoprite's financial characteristics. As the company Shoprite shows low value with an Obermatt Value Rank of 43 (57% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 67% of comparable companies (Obermatt Growth Rank is 67). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 33 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Shoprite, even a low-value company (in terms of its key financial indicators) can be a good investment. 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 | 43 |
|
63 |
|
37 |
|
43 |
|
| GROWTH | ||||||||
| GROWTH | 68 |
|
49 |
|
67 |
|
67 |
|
| SAFETY | ||||||||
| SAFETY | 55 |
|
31 |
|
26 |
|
33 |
|
| COMBINED | ||||||||
| COMBINED | 60 |
|
37 |
|
32 |
|
37 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 43 (worse than 57% compared with alternatives), Shoprite 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 Shoprite. Price-to-Sales (P/S) is 66, which means that the stock price compared with what market professionals expect for future sales is lower than for 66% of comparable companies, indicating a good value concerning Shoprite's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 50% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 60 (dividends are expected to be higher than 60% 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 76% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Shoprite to 24. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 43, is a hold recommendation based on Shoprite'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. 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) | 59 |
|
70 |
|
54 |
|
66 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 39 |
|
52 |
|
59 |
|
50 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 12 |
|
36 |
|
20 |
|
24 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 72 |
|
67 |
|
51 |
|
60 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 43 |
|
63 |
|
37 |
|
43 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 67 (better than 67% compared with alternatives), Shoprite 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 all but one indicator above average for Shoprite. Sales Growth has a rank of 79 which means that currently, professionals expect the company to grow more than 79% of its competitors. Capital Growth is also above 32% of competitors with a rank of 55, and Stock Returns with the rank of 71 is also an outperformance. Only Profit Growth is low with a rank of 32 which means that currently, professionals expect the company to grow its profits less than 68% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 67, 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, Shoprite is a good growth stock. 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. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 53 |
|
25 |
|
55 |
|
79 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 64 |
|
34 |
|
56 |
|
32 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
62 |
|
39 |
|
55 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 70 |
|
83 |
|
77 |
|
71 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 68 |
|
49 |
|
67 |
|
67 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 33 (better than 33% compared with alternatives), the company Shoprite has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Shoprite 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 Shoprite and the other two below average. Refinancing is at 56, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 56% of its competitors. But Leverage is high with a rank of 15, meaning the company has an above-average debt-to-equity ratio. It has more debt than 85% of its competitors. Liquidity is also on the riskier side with a rank of 41, meaning the company generates less profit to service its debt than 59% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 33 (worse than 67% compared with alternatives), Shoprite has a financing structure that is riskier 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 Shoprite 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 Shoprite 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 | 53 |
|
16 |
|
14 |
|
15 |
|
| REFINANCING | ||||||||
| REFINANCING | 51 |
|
51 |
|
55 |
|
56 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 59 |
|
35 |
|
34 |
|
41 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 55 |
|
31 |
|
26 |
|
33 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
18 |
|
31 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
32 |
|
67 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
65 |
|
68 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
56 |
|
62 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
33 |
|
61 |
|
new |
|
Stock analysis by the purely fact based Obermatt Method for Shoprite from April 18, 2024.
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