Fact based stock research
Tech Mahindra (NSEI:TECHM)
INE669C01036
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.
Tech Mahindra stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 67 (better than 67% compared with investment alternatives), Tech Mahindra (IT Consulting & oth. Services, India) shares have above-average financial characteristics compared with similar stocks. Shares of Tech Mahindra are a good value (attractively priced) with a consolidated Value Rank of 76 (better than 76% of alternatives), are safely financed (Safety Rank of 51, which means low debt burdens), but show below-average growth (Growth Rank of 32). ...read more
RECOMMENDATION: A Combined Rank of 67, is a buy recommendation based on Tech Mahindra's financial characteristics. As the company Tech Mahindra's key financial metrics exhibit good value (Obermatt Value Rank of 76) but low growth (Obermatt Growth Rank of 32) while being safely financed (Obermatt Safety Rank of 51), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 76% of comparable companies, may also indicate that 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 and the downside is limited due to below-average financing risks. 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 | India |
| Industry | IT Consulting & oth. Services |
| Index | BSE Sensex, Good Governace Growth Markets, CNX Nifty 50 |
| Size class | X-Large |
This stock has achievements: Top 10 Stock.
25-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.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: Tech Mahindra
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 63 |
|
76 |
|
74 |
|
76 |
|
| GROWTH | ||||||||
| GROWTH | 88 |
|
55 |
|
31 |
|
32 |
|
| SAFETY | ||||||||
| SAFETY | 91 |
|
58 |
|
48 |
|
51 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
38 |
|
27 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
63 |
|
34 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 67 (better than 67% compared with investment alternatives), Tech Mahindra (IT Consulting & oth. Services, India) shares have above-average financial characteristics compared with similar stocks. Shares of Tech Mahindra are a good value (attractively priced) with a consolidated Value Rank of 76 (better than 76% of alternatives), are safely financed (Safety Rank of 51, which means low debt burdens), but show below-average growth (Growth Rank of 32). ...read more
RECOMMENDATION: A Combined Rank of 67, is a buy recommendation based on Tech Mahindra's financial characteristics. As the company Tech Mahindra's key financial metrics exhibit good value (Obermatt Value Rank of 76) but low growth (Obermatt Growth Rank of 32) while being safely financed (Obermatt Safety Rank of 51), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 76% of comparable companies, may also indicate that 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 and the downside is limited due to below-average financing risks. 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 | 63 |
|
76 |
|
74 |
|
76 |
|
| GROWTH | ||||||||
| GROWTH | 88 |
|
55 |
|
31 |
|
32 |
|
| SAFETY | ||||||||
| SAFETY | 91 |
|
58 |
|
48 |
|
51 |
|
| COMBINED | ||||||||
| COMBINED | 97 |
|
73 |
|
54 |
|
67 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 76 (better than 76% compared with alternatives) for 2024, Tech Mahindra 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 Tech Mahindra. Price-to-Sales (P/S) is 62, which means that the stock price compared with what market professionals expect for future sales is lower than for 62% of comparable companies, indicating a good value concerning Tech Mahindra's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 52% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 89 (dividends are expected to be higher than 89% 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 53% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Tech Mahindra to 47. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 76, is a buy recommendation based on Tech Mahindra'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) | 46 |
|
66 |
|
62 |
|
62 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 71 |
|
65 |
|
50 |
|
52 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 19 |
|
52 |
|
50 |
|
47 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 83 |
|
87 |
|
84 |
|
89 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 63 |
|
76 |
|
74 |
|
76 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 32 (better than 32% compared with alternatives), Tech Mahindra shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Tech Mahindra. Capital Growth has a rank of 98, which means that currently professionals expect the company to grow its invested capital more than 1% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 70 (above 70% of alternative investments). But Sales Growth has only a rank of 4, which means that, currently, professionals expect the company to grow less than 96% of its competitors, and Profit Growth is also low at a rank of 1. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 32, is a hold 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 Tech Mahindra, investors may want to look at value and sentiment indicators for a well-rounded picture of this 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, especially since the growth performance is mixed here. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 40 |
|
27 |
|
17 |
|
4 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 37 |
|
53 |
|
4 |
|
1 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
34 |
|
78 |
|
98 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 92 |
|
87 |
|
65 |
|
70 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 88 |
|
55 |
|
31 |
|
32 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 51 (better than 51% compared with alternatives), the company Tech Mahindra 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 Tech Mahindra 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 two out of three indicators above average for Tech Mahindra. Leverage is at a rank of 53, meaning the company has a below-average debt-to-equity ratio. It has less debt than 53% of its competitors. Liquidity is also good at a rank of 55, meaning the company generates more profit to service its debt than 55% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 48, 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 52% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 51 (better than 51% compared with alternatives), Tech Mahindra has a financing structure that is safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Tech Mahindra. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. Investors may have a short-term debt challenge with Tech Mahindra 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 | 58 |
|
56 |
|
56 |
|
53 |
|
| REFINANCING | ||||||||
| REFINANCING | 52 |
|
50 |
|
42 |
|
48 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 97 |
|
64 |
|
54 |
|
55 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 91 |
|
58 |
|
48 |
|
51 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
85 |
|
18 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
22 |
|
39 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
10 |
|
79 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
59 |
|
40 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
38 |
|
27 |
|
new |
|
Stock analysis by the purely fact based Obermatt Method for Tech Mahindra from April 25, 2024.
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