January 18, 2024
Top 10 Stock Sims Metal Management 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: Sims Metal Management – Top 10 Stock in Low Waste Leaders
Sims Metal Management is listed as a top 10 stock on January 18, 2024 in the market index Low Waste because of its high performance in at least one of the Obermatt investment strategies. As three out of four consolidated Obermatt Ranks exhibit excellent performance, it is a solid investment from a financial fact perspective where only investor sentiment is a reason for caution. Based on the Obermatt 360° View of 69 (high 69% performer), Obermatt assesses an overall buy recommendation for Sims Metal Management on January 18, 2024.
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 Sims Metal Management Buy
| 360 METRICS | January 18, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 96 |
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| GROWTH | ||||||||
| GROWTH | 63 |
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| SAFETY | ||||||||
| SAFETY | 54 |
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| SENTIMENT | ||||||||
| SENTIMENT | 22 |
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| 360° VIEW | ||||||||
| 360° VIEW | 69 |
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ANALYSIS: With an Obermatt 360° View of 69 (better than 69% compared with alternatives), overall professional sentiment and financial characteristics for the stock Sims Metal Management are above average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators above average for Sims Metal Management. The consolidated Value Rank has an attractive rank of 96, which means that the share price of Sims Metal Management 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 96% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 63, 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. The company is also safely financed with a Safety Rank of 54. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of only 22. Professional investors are more confident in 78% other stocks. ...read more
RECOMMENDATION: With a consolidated 360° View of 69, Sims Metal Management is better positioned than 69% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 96), above-average growth (Growth Rank of 63), and safe financing practices (Safety Rank of 54), it is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely, unless information not publicly available. Only the professional market sentiment is on the riskier side (Sentiment Rank of 22), but that could also mean an overreaction to negative news in the past. Good value is sometimes an indication that the company's future is challenging. If they have been enjoying above average growth and are still a good value, this may not continue. We recommend evaluating whether the future of Sims Metal Management is as challenging as the low price of the stock despite good growth and safe financing practices suggest. Since the professional community is pessimistic, you may want to reflect these negative opinions in light of what you find reasonable to expect for the future. If you believe this pessimistic view is transitory, you have a solid investment case based on current financial factors. ...read more
Sentiment Strategy: Professional Market Sentiment for Sims Metal Management negative
ANALYSIS: With an Obermatt Sentiment Rank of 22 (better than 22% compared with alternatives), overall professional sentiment and engagement for the stock Sims Metal Management is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half the indicators below and half above average for Sims Metal Management. Analyst Opinions are at a rank of 1 (worse than 99% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 23, which means that stock research experts are getting even more pessimistic. In addition, the Professional Investors rank is 34, which means that professional investors hold less stock in this company than in 66% of alternative investment opportunities. Pros tend to invest in other companies. The only positive sentiment indicator for Sims Metal Management is Market Pulse, with a rank of 89, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 89% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 22 (less encouraging than 78% compared with investment alternatives), Sims Metal Management has a reputation among professional investors that is far below that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: Sims Metal Management Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 96 (better than 96% compared with alternatives) for 2024, Sims Metal Management shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, where three out of four indicators are above average for Sims Metal Management. Price-to-Sales (P/S) is 93 which means that the stock price compared with what market professionals expect for future sales is lower than for 93% of comparable companies, indicating a good value for Sims Metal Management's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 82. Finally, compared with other companies in the same industry, dividend yields of Sims Metal Management are expected to be higher than for 72% of all competitors (a Dividend Yield rank of 72). The only low rank is for expected profits with a Price-to-Profit Rank of 46, indicating that the market expects the company's profit to be low despite a high dividend. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 96, is a buy recommendation based on Sims Metal Management's stock price compared with the company's operational size and dividend yields. The low Profit Rank could result from a one-off charge, for instance, for an accident, a legal settlement, or a restructuring project. If the company keeps its dividends high, the low expected profit may be transitory. If that is the case, the three good value ranks for Sales, Capital, and Dividends are reliable indicators for good stock price value, a low stock price. ...read more
Growth Strategy: Sims Metal Management Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 63 (better than 63% compared with alternatives), Sims Metal Management 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 Sims Metal Management. Sales Growth has a rank of 61 which means that currently, professionals expect the company to grow more than 61% of its competitors. Capital Growth is also above 28% of competitors with a rank of 82. But Profit Growth only has a rank of 28, which means that currently professionals expect the company to grow its profits less than 72% of its competitors. And Stock Returns have also been below average with a rank of only 41. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 63, is a buy 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: Sims Metal Management Debt Financing Safety above-average
| SAFETY METRICS | January 18, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 48 |
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| REFINANCING | ||||||||
| REFINANCING | 71 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 32 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 54 |
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ANALYSIS: With an Obermatt Safety Rank of 54 (better than 54% compared with alternatives), the company Sims Metal Management 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 Sims Metal Management 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 Sims Metal Management and the other two below average. Refinancing is at 71, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 71% of its competitors. But Leverage is high with a rank of 48, meaning the company has an above-average debt-to-equity ratio. It has more debt than 52% of its competitors. Liquidity is also on the riskier side with a rank of 32, meaning the company generates less profit to service its debt than 68% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 54 (better than 54% compared with alternatives), Sims Metal Management 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 Sims Metal Management 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. ...read more
Combined financial peformance: Sims Metal Management Top Financial Performance
| COMBINED PERFORMANCE | January 18, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 96 |
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| GROWTH | ||||||||
| GROWTH | 63 |
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| SAFETY | ||||||||
| SAFETY | 32 |
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| COMBINED | ||||||||
| COMBINED | 96 |
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ANALYSIS: With an Obermatt Combined Rank of 96 (better than 96% compared with investment alternatives), Sims Metal Management (Steel, USA) shares have much better financial characteristics than comparable stocks. Shares of Sims Metal Management are a good value (attractively priced) with a consolidated Value Rank of 96 (better than 96% of alternatives), show above-average growth (Growth Rank of 63), and are safely financed (Safety Rank of 54), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 96, is a strong buy recommendation based on Sims Metal Management's financial characteristics. As the company Sims Metal Management's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 96), above-average growth (Obermatt Growth Rank of 63), and indicate that the company is safely financed (Obermatt Safety Rank of 54), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of Sims Metal Management. 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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