June 1, 2023
Top 10 Stock SoftBank 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: SoftBank – Top 10 Stock in Tokyo Stock Exchange TOPIX 100
SoftBank is listed as a top 10 stock on June 01, 2023 in the market index TOPIX 100 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 27 (27% performer), Obermatt assesses an overall hold recommendation for SoftBank on June 01, 2023.
Snapshot: Obermatt Ranks
| Country | Japan |
| Industry | Wireless Telecommunication |
| Index | TOPIX 100, Artificial Intelligence, Telecommunications |
| 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 SoftBank Hold
| 360 METRICS | June 1, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 63 |
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| GROWTH | ||||||||
| GROWTH | 65 |
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| SAFETY | ||||||||
| SAFETY | 10 |
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| SENTIMENT | ||||||||
| SENTIMENT | 37 |
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| 360° VIEW | ||||||||
| 360° VIEW | 27 |
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ANALYSIS: With an Obermatt 360° View of 27 (better than 27% compared with alternatives), overall professional sentiment and engagement for the stock SoftBank 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 SoftBank. The consolidated Value Rank has an attractive rank of 63, which means that the share price of SoftBank 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 63% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 65, 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 37. Professional investors are more confident in 63% 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 SoftBank. ...read more
RECOMMENDATION: With a 360° View of 27, SoftBank is worse than 73% 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 63 and the Growth Rank above-average at 65, the picture is still mixed. The professional investor community is skeptical, with the Sentiment Rank below-average at 37. 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 SoftBank'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 SoftBank only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 37 (better than 37% compared with alternatives), overall professional sentiment and engagement for the stock SoftBank is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half the indicators below and the other half above average for SoftBank. Analyst Opinions are at a rank of 42 (worse than 58% 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 30, which means that stock research experts are getting more pessimistic. It doesn't end with the analysts. Market Pulse is also low with a rank of 13, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 87% of competitors). On the upside, the Professional Investors rank is 95, which means that professional investors hold more stock in this company than in 95% of alternative investment opportunities. Pros tend to favor investing in this company. This could be due to a large company size, which could contribute to the higher share of professional investors in the company. If this is not the case, the low sentiment ranks are more challenging to explain. ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 37 (less encouraging than 63% compared with investment alternatives), SoftBank has a reputation among professional investors that is below that of its competitors. Should the company be on the smaller side, the presence of professional investors could be reassuring. That would make SoftBank stock something like a hidden gem. Investors should make sure with further research that this is true, because all other sentiment indicators are negative which is a sign for caution. ...read more
Value Strategy: SoftBank Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 63 (better than 63% compared with alternatives), SoftBank 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 SoftBank. Price-to-Sales (P/S) is 67, which means that the stock price compared with what market professionals expect for future sales is lower than for 67% of comparable companies, indicating a good value concerning SoftBank's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 51% of alternatives. Finally, it is true for expected dividend yields with an Dividend Yield rank of 85 (dividends are expected to be higher than 85% 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 83% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for SoftBank to 17. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 63, is a BUY recommendation based on SoftBank'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: SoftBank Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 65 (better than 65% compared with alternatives), SoftBank 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 SoftBank. Capital Growth has a rank of 59, which means that currently professionals expect the company to grow its invested capital more than 32% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 73 (above 73% of alternative investments). But Sales Growth has only a rank of 49, which means that, currently, professionals expect the company to grow less than 51% of its competitors, and Profit Growth is also low at a rank of 32. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 65, is a BUY recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for SoftBank, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. ...read more
Safety Strategy: SoftBank Debt Financing Safety risky
| SAFETY METRICS | June 1, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 10 |
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| REFINANCING | ||||||||
| REFINANCING | 3 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 60 |
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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 SoftBank 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 SoftBank 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 SoftBank. Liquidity is at 60, meaning the company generates more profit to service its debt than 60% 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 10, which means that the company has an above-average debt-to-equity ratio. It has more debt than 90% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 10 (worse than 90% compared with alternatives), SoftBank 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: SoftBank Below-Average Financial Performance
| COMBINED PERFORMANCE | June 1, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 63 |
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| GROWTH | ||||||||
| GROWTH | 65 |
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| SAFETY | ||||||||
| SAFETY | 60 |
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| COMBINED | ||||||||
| COMBINED | 30 |
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ANALYSIS: With an Obermatt Combined Rank of 30 (worse than 70% compared with investment alternatives), SoftBank (Wireless Telecommunication, Japan) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of SoftBank are a good value (attractively priced) with a consolidated Obermatt Value Rank of 63 (better than 63% of alternatives), show above-average growth (Growth Rank of 65) but are riskily financed (Safety Rank of 10), which means above-average debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 30, is a hold recommendation based on SoftBank's financial characteristics. As the company SoftBank's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 63) and above-average growth (Obermatt Growth Rank of 65), 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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