December 21, 2023
Top 10 Stock Western Forest Products 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: Western Forest Products – Top 10 Stock in Wood & Timber Industry
Western Forest Products is listed as a top 10 stock on December 21, 2023 in the market index Timber Industry 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 49 (49% performer), Obermatt assesses an overall hold recommendation for Western Forest Products on December 21, 2023.
Snapshot: Obermatt Ranks
| Country | Canada |
| Industry | Forest Products |
| Index | Renewables Users, Timber Industry |
| 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 Western Forest Products Hold
| 360 METRICS | December 21, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 88 |
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| GROWTH | ||||||||
| GROWTH | 9 |
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| SAFETY | ||||||||
| SAFETY | 98 |
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| SENTIMENT | ||||||||
| SENTIMENT | 18 |
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| 360° VIEW | ||||||||
| 360° VIEW | 49 |
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ANALYSIS: With an Obermatt 360° View of 49 (better than 49% compared with alternatives), overall professional sentiment and financial characteristics for the stock Western Forest Products are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Western Forest Products. The consolidated Value Rank has an attractive rank of 88, which means that the share price of Western Forest Products 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 88% 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 18. Professional investors are more confident in 82% other stocks. The consolidated Growth Rank also has a low rank of 9, 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. 91 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 49, Western Forest Products is worse than 51% 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 88), 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 18), as is the growth momentum for the company (Growth Rank of 9). 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 Western Forest Products negative
ANALYSIS: With an Obermatt Sentiment Rank of 18 (better than 18% compared with alternatives), overall professional sentiment and engagement for the stock Western Forest Products is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Western Forest Products. 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 84, which means that stock research experts have found something to make them more positive about investing in the company. In other words, they are getting more optimistic of stock investments in Western Forest Products. But the Professional Investors rank is low at 6, which means that professional investors hold less stock in this company than in 94% of alternative investment opportunities. Pros tend to invest in other companies. Market Pulse is also low at a rank of 24, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 76% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 18 (less encouraging than 82% compared with investment alternatives), Western Forest Products has a reputation among professional investors that is far below that of its competitors. These are quite a few negative sentiment signals. One may want to trust the analysts that are changing their opinions. They may be early indications of better times, especially if the company is a smaller one. But If they are an extra large company, they should have more professional stockholders than are currently present. ...read more
Value Strategy: Western Forest Products Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 88 (better than 88% compared with alternatives) for 2023, Western Forest Products 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 Western Forest Products. Price-to-Sales (P/S) is 93, which means that the stock price compared with what market professionals expect for future sales is lower than for 93% of comparable companies, indicating a good value regarding Western Forest Products's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 100% of alternatives, and it's also true for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 100. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 37% of all competitors have even lower dividend yields than Western Forest Products (a Dividend Yield Rank of 37). 63% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 88, is a buy recommendation based on Western Forest Products's stock price compared with the company's operational size and dividend yields. The below-average dividend yield may be a good sign, as it could mean the company has more attractive investment opportunities for the generated cash than to pay it out as dividends. A low dividend yield can also indicate a growth phase. ...read more
Growth Strategy: Western Forest Products Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 9 (better than 9% compared with alternatives), Western Forest Products 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 Western Forest Products. Only Capital Growth has a good rank of 77, which means that currently professionals expect the company to grow its invested capital more than 6% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 17 which means that currently professionals expect the company to grow less than 83% of its competitors. Profit Growth with a rank of 6 and Stock Returns with a rank of 11 are also low (below 89% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 9, is a sell recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Western Forest Products is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. ...read more
Safety Strategy: Western Forest Products Debt Financing Safety very solid
| SAFETY METRICS | December 21, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 90 |
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| REFINANCING | ||||||||
| REFINANCING | 97 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 76 |
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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 Western Forest Products has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Western Forest Products 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 Western Forest Products. Leverage is at 90, meaning the company has a below-average debt-to-equity ratio. It has less debt than 90% 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 76, which means that the company generates more profit to service its debt than 76% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 98 (better than 98% compared with alternatives), Western Forest Products 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: Western Forest Products Top Financial Performance
| COMBINED PERFORMANCE | December 21, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 88 |
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| GROWTH | ||||||||
| GROWTH | 9 |
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| SAFETY | ||||||||
| SAFETY | 76 |
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| COMBINED | ||||||||
| COMBINED | 85 |
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ANALYSIS: With an Obermatt Combined Rank of 85 (better than 85% compared with investment alternatives), Western Forest Products (Forest Products, Canada) shares have much better financial characteristics than comparable stocks. Shares of Western Forest Products are a good value (attractively priced) with a consolidated Value Rank of 88 (better than 88% of alternatives), are safely financed (Safety Rank of 98, which means low debt burdens), but show below-average growth (Growth Rank of 9). ...read more
RECOMMENDATION: A Combined Rank of 85, is a strong buy recommendation based on Western Forest Products's financial characteristics. As the company Western Forest Products's key financial metrics exhibit good value (Obermatt Value Rank of 88) but low growth (Obermatt Growth Rank of 9) 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 88% 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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