Fact based stock research
Sumitomo Chemical (TSE:4005)

JP3401400001

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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.

Sumitomo Chemical stock research in summary

sumitomo-chem.co.jp

ANALYSIS: With an Obermatt Combined Rank of 8 (worse than 92% compared with investment alternatives), Sumitomo Chemical (Diversified Chemicals, Japan) shares have lower financial characteristics compared with similar stocks. Shares of Sumitomo Chemical are a good value (attractively priced) with a consolidated Value Rank of 87 (better than 87% of alternatives) but show below-average growth (Growth Rank of 5), and are riskily financed (Safety Rank of 10), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 8, is a sell recommendation based on Sumitomo Chemical's financial characteristics. As the company Sumitomo Chemical's key financial metrics exhibit good value (Obermatt Value Rank of 87) but low growth (Obermatt Growth Rank of 5) and risky financing practices (Obermatt Safety Rank of 10), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 87% of comparable companies, may indicate 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. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	87
Growth Rank	5
Safety Rank	10
Combined Rank	8

Country	Japan
Industry	Diversified Chemicals
Index	Low Emissions, Energy Efficient, Nikkei 225
Size class	XX-Large

18-Apr-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Sumitomo Chemical

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	100	93	83	87
GROWTH
GROWTH	11	83	3	5
SAFETY
SAFETY	42	12	12	10
SENTIMENT
SENTIMENT	n/a	71	4	^new
360° VIEW
360° VIEW	n/a	85	10	^new

Most recent update of the stock research: 18-Apr-2024. Financial reporting date used for calculating ranks: 31-Dec-2023. Stock research history is based on the Obermatt Method. The higher the rank, the better Sumitomo Chemical is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	100	93	83	87
GROWTH
GROWTH	11	83	3	5
SAFETY
SAFETY	42	12	12	10
COMBINED
COMBINED	81	76	14	8

Last update of combined financial performance: 18-Apr-2024. Stock analysis on combined financial performance: The higher the rank of Sumitomo Chemical the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 87 (better than 87% compared with alternatives) for 2024, Sumitomo Chemical shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Sumitomo Chemical. Price-to-Sales (P/S) is 100, which means that the stock price compared with what market professionals expect for future sales is lower than for 100% of comparable companies, indicating a good value regarding Sumitomo Chemical's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 76% of alternatives, and it's also true for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 85. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 37% of all competitors have even lower dividend yields than Sumitomo Chemical (a Dividend Yield Rank of 37). 63% alternative investments in the same business provide a higher dividend yield. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 87, is a buy recommendation based on Sumitomo Chemical's stock price compared with the company's operational size and dividend yields. The below-average dividend yield may be a good sign, as it could mean the company has more attractive investment opportunities for the generated cash than to pay it out as dividends. A low dividend yield can also indicate a growth phase. 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)	100	91	100	100
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	98	89	30	76
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	98	68	97	85
DIVIDEND YIELD
DIVIDEND YIELD	92	89	74	37
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	100	93	83	87

Last update of Value Rank: 18-Apr-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Sumitomo Chemical; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 5 (better than 5% compared with alternatives), Sumitomo Chemical shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below-average for Sumitomo Chemical. While Sales Growth ranks at 57, professionals currently expect the company to grow more than 57% of its competitors, while all other growth ranks are below the market median. Profit Growth has a rank of 1, which means that, currently, professionals expect the company to grow its profits less than 99% of its competitors, and Capital Growth has a low rank of 45. Historic stock returns were also below average with a current Stock Returns rank of 15 which means that the stock returns have recently been below 85% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 5, is a sell recommendation for growth and momentum investors. If revenues are expected to increase, but all other growth indicators are negative, the company may be investing in future growth through means not visible in the balance sheet and thus not reflected in capital growth. The fact that Stock Returns have been below market doesn't mean that much, as it may be due to overly optimistic investor behavior in the past, which has been corrected to a more reasonable level recently. If that were the case, a positive Value Rank would be a reason to invest because the company is still expected to grow, while stock prices are now at a more reasonable level. 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, especially since the growth performance isn't stellar here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	20	26	48	57
PROFIT GROWTH
PROFIT GROWTH	44	81	1	1
CAPITAL GROWTH
CAPITAL GROWTH	n/a	74	19	45
STOCK RETURNS
STOCK RETURNS	44	89	3	15
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	11	83	3	5

Last update of Growth Rank: 18-Apr-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Sumitomo Chemical.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 10 (better than 10% compared with alternatives), the company Sumitomo Chemical 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 Sumitomo Chemical 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 Sumitomo Chemical and the other two below average. Refinancing is at 63, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 63% of its competitors. But Leverage is high with a rank of 12, meaning the company has an above-average debt-to-equity ratio. It has more debt than 88% of its competitors. Liquidity is also on the riskier side with a rank of 18, meaning the company generates less profit to service its debt than 82% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 10 (worse than 90% compared with alternatives), Sumitomo Chemical has a financing structure that is significantly 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 Sumitomo Chemical 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 Sumitomo Chemical 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	2	10	8	12
REFINANCING
REFINANCING	98	63	81	63
LIQUIDITY
LIQUIDITY	17	18	14	18
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	42	12	12	10

Last update of Safety Rank: 18-Apr-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Sumitomo Chemical and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	25	19	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	39	39	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	76	1	^new
MARKET PULSE
MARKET PULSE	n/a	74	1	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	71	4	^new

Last update of Sentiment Rank: 18-Apr-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Sumitomo Chemical.
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