December 21, 2023
Top 10 Stock Treasury Wine Estates 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: Treasury Wine Estates – Top 10 Stock in Australian Securities Exchange Index ASX 100
Treasury Wine Estates is listed as a top 10 stock on December 21, 2023 in the market index ASX 100 because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company is growing above average, but all other facts speak against a stock purchase, especially the low market sentiment by professional investors. Based on the Obermatt 360° View of 45 (45% performer), Obermatt assesses an overall hold recommendation for Treasury Wine Estates on December 21, 2023.
Snapshot: Obermatt Ranks
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 Treasury Wine Estates Hold
| 360 METRICS | December 21, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 34 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 71 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 45 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 40 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 45 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 45 (better than 45% compared with alternatives), overall professional sentiment and financial characteristics for the stock Treasury Wine Estates are below the industry average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Treasury Wine Estates. The consolidated Growth Rank has a good rank of 71, 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. It ranks higher than 71% of competitors in the same industry. The other indicators are below average, namely the Value, Safety, and Sentiment Ranks.The Value Rank at 34 means that the share price of Treasury Wine Estates is on the high side compared with its peers regarding revenues, profits, and invested capital. The stock price is higher than for 66% of alternative stocks in the same industry. The consolidated Safety Rank has a riskier rank of 45, which means that the company has a riskier financing structure than 55% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. The consolidated Sentiment Rank also has a low rank of 40, indicating professional investors are more pessimistic about the stock than for 60% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 45, Treasury Wine Estates is worse than 55% of all alternative stock investment opportunities based on the Obermatt Method. As only one of the consolidated Obermatt Ranks exhibits excellent performance, namely the above-average growth (Growth Rank of 71), it is a riskier stock investment proposition. Aside from the critical professional market sentiment (Sentiment Rank of 40), the company is rather risky when it comes to financing (Safety Rank of 45). The negative market view on Treasury Wine Estates may be due to the high stock price (low value). A growth company like this may get too expensive at one point in time. If too many investors are desperate to join the party, they may drive stock prices above reasonable levels. While it is typical for growth companies to have low value, because investors are willing to pay more for companies that are expected to have high growth, the crucial question is: how much more do you pay for the stock of Treasury Wine Estates compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one minus the growth rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value (even though it is lower than 50). As market sentiment is critical, you should be careful with paying more than market-average for this stock and conduct further research into the company's future growth potential. ...read more
Sentiment Strategy: Professional Market Sentiment for Treasury Wine Estates only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 40 (better than 40% compared with alternatives), overall professional sentiment and engagement for the stock Treasury Wine Estates is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the indicators below and half above average for Treasury Wine Estates. Analyst Opinions are at a rank of 67 (better than 67% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. Market Pulse is also positive with a rank of 80, which means that the current professional news and professional social networks are positive when discussing this company (more positive news than for 80% of competitors). But Analyst Opinions Change is negative with a below 50 rank of 32, which means that stock research experts are changing their opinions for the worse in recommending the company. In other words, they are getting more critical of investments in Treasury Wine Estates. There are also only so many institutional investors holding company stock with a Professional Investors rank of 30, which means that, currently, professional investors hold less stock in this company than in 70% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 40 (less encouraging than 60% compared with investment alternatives), Treasury Wine Estates has a reputation among professional investors that is below that of its competitors. The signals are ambivalent. The positive news in the market contradicts the negative change in analyst recommendations. Since the overall analyst recommendations are still above average, the stock may be safer for investing, especially if it is not an extra-large company where Pros tend to be less present. In such a case, the Pro Investor rank is not a problem. ...read more
Value Strategy: Treasury Wine Estates Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 34 (worse than 66% compared with alternatives), Treasury Wine Estates shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Treasury Wine Estates. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 83% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 3 which means that the stock price compared with what market professionals expect for future profits is higher than 97% of comparable companies, indicating a low value concerning Treasury Wine Estates's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 34 which means that the stock price compared with what market professionals expect for future profit levels is higher than 66% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 32 is also low. Compared with invested capital, the stock price is higher than for 68% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 34, is a hold recommendation based on Treasury Wine Estates's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Treasury Wine Estates? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose Treasury Wine Estates only if they reasonably expect the low current profit levels to be transitory. ...read more
Growth Strategy: Treasury Wine Estates Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 71 (better than 71% compared with alternatives), Treasury Wine Estates 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 Treasury Wine Estates. Sales Growth has a rank of 94 which means that currently, professionals expect the company to grow more than 94% of its competitors. Capital Growth is also above 48% of competitors with a rank of 76. But Profit Growth only has a rank of 48, which means that currently professionals expect the company to grow its profits less than 52% of its competitors. And Stock Returns have also been below average with a rank of only 9. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 71, is a buy 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: Treasury Wine Estates Debt Financing Safety below-average
| SAFETY METRICS | December 21, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 42 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 33 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 66 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 45 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 45 (better than 45% compared with alternatives), the company Treasury Wine Estates has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Treasury Wine Estates 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 Treasury Wine Estates. Liquidity is at 66, meaning the company generates more profit to service its debt than 66% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 33, 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 67% of its competitors. Leverage is also high at a rank of 42, which means that the company has an above-average debt-to-equity ratio. It has more debt than 58% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 45 (worse than 55% compared with alternatives), Treasury Wine Estates has a financing structure that is riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually 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: Treasury Wine Estates Below-Average Financial Performance
| COMBINED PERFORMANCE | December 21, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 34 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 71 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 66 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 47 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 47 (worse than 53% compared with investment alternatives), Treasury Wine Estates (Distillers & Vintners, Australia) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Treasury Wine Estates are low in value (priced high) with a consolidated Value Rank of 34 (worse than 66% of alternatives), and are riskily financed (Safety Rank of 45, which means above-average debt burdens) but show above-average growth (Growth Rank of 71). ...read more
RECOMMENDATION: A Combined Rank of 47, is a hold recommendation based on Treasury Wine Estates's financial characteristics. As the company Treasury Wine Estates shows low value with an Obermatt Value Rank of 34 (66% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 71% of comparable companies (Obermatt Growth Rank is 71). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 45 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Treasury Wine Estates, even a low-value company (in terms of its key financial indicators) can be a good investment. ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.