August 31, 2023
Top 10 Stock Thungela Resources 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: Thungela Resources – Top 10 Stock in Johannesburg Securities Exchange All Shares Index JSE All Shares
Thungela Resources is listed as a top 10 stock on August 31, 2023 in the market index JSE All Shares 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 negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 85 (top 85% performer), Obermatt assesses an overall strong buy recommendation for Thungela Resources on August 31, 2023.
Snapshot: Obermatt Ranks
| Country | South Africa |
| Industry | Coal & Consumable Fuels |
| Index | JSE All Shares |
| Size class | 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° View Thungela Resources Strong Buy
| 360 METRICS | August 31, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 85 |
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| GROWTH | ||||||||
| GROWTH | 43 |
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| SAFETY | ||||||||
| SAFETY | 98 |
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| SENTIMENT | ||||||||
| SENTIMENT | 39 |
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| 360° VIEW | ||||||||
| 360° VIEW | 85 |
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ANALYSIS: With an Obermatt 360° View of 85 (better than 85% compared with alternatives) for 2023, overall professional sentiment and financial characteristics for the stock Thungela Resources are very positive. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Thungela Resources. The consolidated Value Rank has an attractive rank of 85, which means that the share price of Thungela Resources 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 85% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 98. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 39. Professional investors are more confident in 61% other stocks. The consolidated Growth Rank also has a low rank of 43, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 57 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 85, Thungela Resources is better positioned than 85% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 85), and the financing structure is on the safer side (Safety Rank of 98). However, sentiment in the professional investor community is below-average (Sentiment Rank of 39), as is the growth momentum for the company (Growth Rank of 43). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still 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 Thungela Resources only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 39 (better than 39% compared with alternatives), overall professional sentiment and engagement for the stock Thungela Resources is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Thungela Resources. Analyst Opinions are at a rank of 22 (worse than 78% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 62, which means that stock research experts are more positive in their investment recommendations in the company. In other words, they are getting more optimistic of stock investments in Thungela Resources. More encouragingly, the Professional Investors rank is 51, which means that professional investors hold more stock in this company than in 51% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 32, 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 68% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 39 (less encouraging than 61% compared with investment alternatives), Thungela Resources has a reputation among professional investors that is below that of its competitors. The sentiment signals are mixed for Thungela Resources. While analysts and the news channels are negative, there is a change in what analysts think. Above-average institutional investors in this company support them. Sentiment signals remain mixed with analysts and news channels pessimistic, though improving, and professional investors above average. ...read more
Value Strategy: Thungela Resources Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 85 (better than 85% compared with alternatives) for 2023, Thungela Resources shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Thungela Resources. Price-to-Sales is 69 which means that the stock price compared with what market professionals expect for future sales is lower than for 69% of comparable companies, indicating a good value for Thungela Resources's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 93% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 72. Compared with other companies in the same industry, dividend yields of Thungela Resources are expected to be higher than for 78% of all competitors (a Dividend Yield rank of 78). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 85, is a buy recommendation based on Thungela Resources'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 Thungela Resources based on its detailed value metrics.
Growth Strategy: Thungela Resources Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 43 (better than 43% compared with alternatives), Thungela Resources 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 Thungela Resources. Sales Growth has a rank of 72 which means that currently, professionals expect the company to grow more than 72% of its competitors. Capital Growth is also above 8% of competitors with a rank of 81. But Profit Growth only has a rank of 8, which means that currently professionals expect the company to grow its profits less than 92% of its competitors. And Stock Returns have also been below average with a rank of only 13. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 43, is a hold 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: Thungela Resources Debt Financing Safety very solid
| SAFETY METRICS | August 31, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 95 |
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| REFINANCING | ||||||||
| REFINANCING | 97 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 91 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 98 |
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ANALYSIS: With an Obermatt Safety Rank of 98 (better than 98% compared with alternatives) for 2023, the company Thungela Resources has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Thungela Resources 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 Thungela Resources. Leverage is at 95, meaning the company has a below-average debt-to-equity ratio. It has less debt than 95% of its competitors. Refinancing is at a rank of 97, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 97% of its competitors. Finally, Liquidity is also good at a rank of 91, which means that the company generates more profit to service its debt than 91% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 98 (better than 98% compared with alternatives), Thungela Resources 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: Thungela Resources Top Financial Performance
| COMBINED PERFORMANCE | August 31, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 85 |
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| GROWTH | ||||||||
| GROWTH | 43 |
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| SAFETY | ||||||||
| SAFETY | 91 |
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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), Thungela Resources (Coal & Consumable Fuels, South Africa) shares have much better financial characteristics than comparable stocks. Shares of Thungela Resources are a good value (attractively priced) with a consolidated Value Rank of 85 (better than 85% of alternatives), are safely financed (Safety Rank of 98, which means low debt burdens), but show below-average growth (Growth Rank of 43). ...read more
RECOMMENDATION: A Combined Rank of 94, is a strong buy recommendation based on Thungela Resources's financial characteristics. As the company Thungela Resources's key financial metrics exhibit good value (Obermatt Value Rank of 85) but low growth (Obermatt Growth Rank of 43) while being safely financed (Obermatt Safety Rank of 98), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 85% 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. ...read more
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