May 11, 2023
Top 10 Stock Sumitomo Forestry Strong 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: Sumitomo Forestry – Top 10 Stock in Wood & Timber Industry
Sumitomo Forestry is listed as a top 10 stock on May 11, 2023 in the market index Timber Industry 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° Rank of 80 (top 80% performer), Obermatt assesses an overall strong buy recommendation for Sumitomo Forestry on May 11, 2023.
Snapshot: Obermatt Ranks
| Country | Japan |
| Industry | Homebuilding |
| Index | Renewables Users, Timber Industry |
| 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 Sumitomo Forestry Strong Buy
| 360 METRICS | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 99 |
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| GROWTH | ||||||||
| GROWTH | 61 |
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| SAFETY | ||||||||
| SAFETY | 90 |
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| SENTIMENT | ||||||||
| SENTIMENT | 18 |
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| 360° VIEW | ||||||||
| 360° VIEW | 80 |
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ANALYSIS: With an Obermatt 360° Rank of 80 (better than 80% compared with alternatives) for 2023, overall professional sentiment and engagement for the stock Sumitomo Forestry are very positive. The 360° Rank is based on consolidating four consolidated indicators, with three out of four indicators above average for Sumitomo Forestry. The consolidated Value Rank has an attractive rank of 99, which means that the share price of Sumitomo Forestry 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 99% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 61, 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 90. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of only 18. Professional investors are more confident in 82% other stocks. ...read more
RECOMMENDATION: With a 360° Rank of 80, Sumitomo Forestry is better than 80% 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 99), above-average growth (Growth Rank of 61) and an indication that the company is safely financed (Safety Rank of 90), 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 18), 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 Sumitomo Forestry 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 Sumitomo Forestry negative
ANALYSIS: With an Obermatt Sentiment Rank of 18 (better than 18% compared with alternatives), overall professional sentiment and engagement for the stock Sumitomo Forestry is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Sumitomo Forestry. Analyst Opinions are at a rank of 41 (worse than 59% 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 19 which means that stock research experts are getting even more pessimistic. It doesn't end with the analysts. Market Pulse is also low with a rank of 47, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 53% of competitors). No wonder, the Professional Investors rank is only 29, which means that professional investors hold less stock in this company than in 71% of alternative investment opportunities. Pros tend to stay away from Sumitomo Forestry, which may be due to a small company size but just as likely because of its relatively low Sentiment Rank. ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 18 (less encouraging than 82% compared with investment alternatives), Sumitomo Forestry has a reputation among professional investors that is far below that of its competitors. Investors should be careful with this stock right now. Further research is required if an investment is desired, because the facts found in the professional community are all negative. ...read more
Value Strategy: Sumitomo Forestry Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 99 (better than 99% compared with alternatives) for 2023, Sumitomo Forestry shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Sumitomo Forestry. Price-to-Sales has a value of 80 which means that the stock price compared with what market professionals expect for future sales is lower than 80% of comparable companies, indicating a good value for Sumitomo Forestry's revenue size. The same is valid for expected Price-to-Profits, more favorable than 92% of alternatives, and it is also true for the Price-to-Book capital (also referred to as market-to-book ratio) with an Obermatt Price-to-Capital Rank of 73. Compared with other companies in the same industry, dividend yields of Sumitomo Forestry are expected to be higher than 78% of all competitors (an Obermatt Dividend Yield rank of 78). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 99, is a strong buy recommendation based on Sumitomo Forestry's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in Sumitomo Forestry based on its detailed value metrics.
Growth Strategy: Sumitomo Forestry Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 61 (better than 61% compared with alternatives), Sumitomo Forestry 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 Sumitomo Forestry. Sales Growth has a rank of 74 which means that currently professionals expect the company to grow more than 74% of its competitors. Stock Returns are also above average with a rank of 97. But Capital Growth has only a rank of 34, which means that currently professionals expect the company to grow its invested capital less than 85% of its competitors. Profit Growth is also low, with a rank of only 15, which means that, currently, professionals expect the company to grow its profits below average. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 61, is a BUY recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 97% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. ...read more
Safety Strategy: Sumitomo Forestry Debt Financing Safety very solid
| SAFETY METRICS | May 11, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 52 |
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| REFINANCING | ||||||||
| REFINANCING | 83 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 80 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 90 |
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ANALYSIS: With an Obermatt Safety Rank of 90 (better than 90% compared with alternatives) for 2023, the company Sumitomo Forestry has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Sumitomo Forestry 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, where all three are above average for Sumitomo Forestry. Leverage is at 52, meaning the company has a below-average debt-to-equity ratio. It has less debt than 52% of its competitors. Refinancing is at a rank of 83, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 83% of its competitors. Finally, Liquidity is also good at a rank of 80, which means that the company generates more profit to service its debt than 80% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 90 (better than 90% compared with alternatives), Sumitomo Forestry has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more
Combined financial peformance: Sumitomo Forestry Top Financial Performance
| COMBINED PERFORMANCE | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 99 |
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| GROWTH | ||||||||
| GROWTH | 61 |
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| SAFETY | ||||||||
| SAFETY | 80 |
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| COMBINED | ||||||||
| COMBINED | 94 |
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ANALYSIS: With an Obermatt Combined Rank of 94 (better than 94% compared with investment alternatives), Sumitomo Forestry (Homebuilding, Japan) shares have much better financial characteristics than comparable stocks. Shares of Sumitomo Forestry are a good value (attractively priced) with a consolidated Obermatt Value Rank of 99 (better than 99% of alternatives), show above-average growth (Growth Rank of 61), and are safely financed (Safety Rank of 90), which means low debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 94, is a strong buy recommendation based on Sumitomo Forestry's financial characteristics. As the company Sumitomo Forestry's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 99), above-average growth (Obermatt Growth Rank of 61), and indicate that the company is safely financed (Obermatt Safety Rank of 90), 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 clear in the future. We recommend evaluating the future of Sumitomo Forestry. 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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