March 21, 2024
Top 10 Stock UniCredit 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: UniCredit – Top 10 Stock in Milano Italia Borsa Index MIB
UniCredit is listed as a top 10 stock on March 21, 2024 in the market index MIB 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 where the risk of paying too much for the shares is low, despite a currently slow growth momentum. Based on the Obermatt 360° View of 81 (top 81% performer), Obermatt assesses an overall strong buy recommendation for UniCredit on March 21, 2024.
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 UniCredit Strong Buy
| 360 METRICS | March 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 56 |
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| GROWTH | ||||||||
| GROWTH | 24 |
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| SAFETY | ||||||||
| SAFETY | 81 |
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| SENTIMENT | ||||||||
| SENTIMENT | 89 |
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| 360° VIEW | ||||||||
| 360° VIEW | 81 |
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ANALYSIS: With an Obermatt 360° View of 81 (better than 81% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock UniCredit are very positive. The 360° View is based on consolidating four consolidated indicators, with half of the indicators below and half above average for UniCredit. The consolidated Value Rank has an attractive rank of 56, which means that the share price of UniCredit 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 56% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 81. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 89. But the consolidated Growth Rank has a low rank of 24, which means that the company is below average in terms of growth and momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. 76 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 81, UniCredit is better positioned than 81% of all alternative stock investment opportunities based on the Obermatt Method. Three out of four consolidated Obermatt Ranks show above-average performance. The stock has as good value (Value Rank of 56), secure financing practices (Safety Rank of 81), and positive market sentiment in the professional investor community (Sentiment Rank of 89). It is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely to occur. The company’s growth expectations are below the industry average (Growth Rank of 24), but that could also be temporary since professional investors remain optimistic despite the low growth numbers. The low price as reflected in the good Value Rank could indicate that the company's future is challenging. The below-par growth performance may be the reason for this. Companies that grow less are typically cheaper than fast-growing competitors. We recommend evaluating whether the future of UniCredit is as difficult as the stock’s low price suggests, despite the positive professional investor sentiment. Since the professional community is optimistic, you might have less to worry about, and the stock may just go through a more challenging phase now, indicating good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for UniCredit very positive
ANALYSIS: With an Obermatt Sentiment Rank of 89 (better than 89% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock UniCredit is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all four indicators above average for UniCredit. Analyst Opinions are at a rank of 85 (better than 85% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive with a rank of 53, which means that stock research experts are changing their opinions for the better and recommending investing in the company. They are getting more optimistic about stock investments in UniCredit. The Professional Investors rank is 96, which means that currently, professional investors hold more stock in this company than in 96% of alternative investment opportunities. Pros tend to favor investing in this company. Finally, Market Pulse has a rank of 57 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 57% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 89 (more positive than 89% compared with investment alternatives), UniCredit has a reputation among professional investors that is significantly higher than that of its competitors. Since all market sentiment indicators are positive, the professional community highly recommends investment in the company. Does this mean UniCredit stocks are a safe investment? Far from it. Even professionals make mistakes. Especially in stock investing, there is a tendency to follow the leaders. Since trees don't grow to the heavens, such positive sentiment may also be interpreted as a danger sign. A lot of optimism can often be a sign of troubles to come, albeit unforeseen by most. ...read more
Value Strategy: UniCredit Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 56 (better than 56% compared with alternatives), UniCredit shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for UniCredit. Price-to-Profit (also referred to as price to earnings, P/E ratio) is 72 which means that the stock price compared with what market professionals expect for future profits is lower than for 72% of comparable companies, indicating a good value concerning UniCredit's profit levels. The same is valid for the expected Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 52, and for Dividend Yield with a Dividend Yield Rank of 59. But, compared with other companies in the same industry, the stock price is higher than average as regards expected revenues; only 53% of all competitors have an even higher stock price as regards to sales revenues (a Price-to-Sales Rank of 47). Profits, the level of invested capital, and dividend policy suggest that this stock is attractively priced. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 56, is a buy recommendation based on UniCredit's stock price compared with the company's operational size and dividend yields. Since it is on the expensive side for Price-to-Sales, it may mean that UniCredit has pricing power in its distribution market because it can charge higher prices than its competitors. If this is the case, all four value indicators are positive signals for purchasing UniCredit shares. ...read more
Growth Strategy: UniCredit Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 24 (better than 24% compared with alternatives), UniCredit 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 UniCredit. Sales Growth has a below market rank of 23, which means that, currently, professionals expect the company to grow less than 77% of its competitors. The same is valid for Capital Growth, with a rank of 13, and Profit Growth, with a rank of 26. Currently, professionals expect the company to grow its profits less than 74% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 96, which means that the stock returns have recently been above 96% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 24, is a sell recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for UniCredit, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with recent above-market stock returns. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive stock returns are not yet a sign of recovery. Investors should look closely at the Value and Sentiment indicators before they make a stock purchasing decision, because growth is unlikely to be the driving argument behind this investment. ...read more
Safety Strategy: UniCredit Debt Financing Safety very solid
| SAFETY METRICS | March 21, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 46 |
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| REFINANCING | ||||||||
| REFINANCING | 80 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 67 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 81 |
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ANALYSIS: With an Obermatt Safety Rank of 81 (better than 81% compared with alternatives) for 2024, the company UniCredit has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of UniCredit 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 UniCredit. Refinancing is at 80, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 80% of its competitors. Liquidity is also good at 67, meaning the company generates more profit to service its debt than 67% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 46, which means the company has an above-average debt-to-equity ratio. It has more debt than 54% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 81 (better than 81% compared with alternatives), UniCredit has a financing structure that is significantly safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and UniCredit could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. ...read more
Combined financial peformance: UniCredit Above-Average Financial Performance
| COMBINED PERFORMANCE | March 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 56 |
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| GROWTH | ||||||||
| GROWTH | 24 |
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| SAFETY | ||||||||
| SAFETY | 67 |
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| COMBINED | ||||||||
| COMBINED | 58 |
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ANALYSIS: With an Obermatt Combined Rank of 58 (better than 58% compared with investment alternatives), UniCredit (Diversified Banks, Italy) shares have above-average financial characteristics compared with similar stocks. Shares of UniCredit are a good value (attractively priced) with a consolidated Value Rank of 56 (better than 56% of alternatives), are safely financed (Safety Rank of 81, which means low debt burdens), but show below-average growth (Growth Rank of 24). ...read more
RECOMMENDATION: A Combined Rank of 58, is a buy recommendation based on UniCredit's financial characteristics. As the company UniCredit's key financial metrics exhibit good value (Obermatt Value Rank of 56) but low growth (Obermatt Growth Rank of 24) while being safely financed (Obermatt Safety Rank of 81), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 56% 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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