June 22, 2023
Top 10 Stock 3i Group 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: 3i Group – Top 10 Stock in FTSE 100 Index
3i Group is listed as a top 10 stock on June 22, 2023 in the market index FTSE 100 because of its high performance in at least one of the Obermatt investment strategies. As all consolidated Obermatt Ranks exhibit excellent performance, including positive market sentiment in the professional investor community, it is a solid stock investment where the risk of paying too much for the shares is limited. Based on the Obermatt 360° View of 93 (top 93% performer), Obermatt assesses an overall strong buy recommendation for 3i Group on June 22, 2023.
Snapshot: Obermatt Ranks
| Country | United Kingdom |
| Industry | Asset Management & Custody |
| Index | FTSE All Shares, FTSE 100, FTSE 350, Diversity Europe |
| Size class | X-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 3i Group Strong Buy
| 360 METRICS | June 22, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 52 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 78 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 58 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 77 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 93 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 93 (better than 93% compared with alternatives) for 2023, overall professional sentiment and financial characteristics for the stock 3i Group are very positive. The 360° View is based on consolidating four consolidated indicators, with all four indicators above average for 3i Group. The consolidated Value Rank has an attractive rank of 52, which means that the share price of 3i Group 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 52% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 78, 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. The company is also safely financed with a Safety rank of 58. Finally, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 77. ...read more
RECOMMENDATION: With a 360° View of 93, 3i Group is better positioned than 93% of all alternative stock investment opportunities based on the Obermatt Method. As all consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 52), above-average growth (Growth Rank of 78), safe financing practices (Safety Rank of 58), and a positive market sentiment in the professional investor community (Sentiment Rank of 77), 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, unless information not publicly available. High-Value Ranks sometimes indicate that the company's future is challenging. If they are safely financed and have above average growth, and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of 3i Group is as difficult as the stock’s low price, despite what good growth and safe financing practice suggest. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible, which may indicate good timing right now. ...read more
Sentiment Strategy: Professional Market Sentiment for 3i Group very positive
ANALYSIS: With an Obermatt Sentiment Rank of 77 (better than 77% compared with alternatives) for 2023, overall professional sentiment and engagement for the stock 3i Group is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for 3i Group. Analyst Opinions are at a rank of 68 (better than 68% 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 and has a rank of 85 which means that currently, stock research experts are getting even more optimistic about investments in 3i Group. But Market Pulse has a low rank of 39, 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 61% of competitors). This is an essential sign of caution, as it could be the forebearer of bad news. Professional Investors are also somewhat absent with a rank of 46, which means that, currently, professional investors hold less stock in this company than in 54% of alternative investment opportunities. Pros tend to invest in other companies. This is expected if the company is of a smaller size (medium or smaller). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 77 (more positive than 77% compared with investment alternatives), 3i Group has a reputation among professional investors that is significantly higher than that of its competitors. While the general news feeds in the professional market are negative, the analyst recommendations are optimistic about the company, and even increase their ratings despite the negative news. This is an ambiguous situation with positive and negative signals from the professional side. Investors should be on the lookout for negative news but not worry too much about it as long as the overall news is still positive. ...read more
Value Strategy: 3i Group Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 52 (better than 52% compared with alternatives), 3i Group shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for 3i Group. Price-to-Profit (also referred to as price-earnings, P/E) is 89 which means that the stock price compared with what market professionals expect for future profits is lower than for 89% of comparable companies, indicating a good value concerning 3i Group's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 61, which means that the stock price is lower as regards to invested capital than for 61% of comparable investments. On the other hand, Price-to-Sales is less favorable than for 66% of alternatives (only 34% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than for 78% of comparable companies, making the stock more expensive compared with the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 52, is a BUY recommendation based on 3i Group's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high concerning expected revenues, the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting Group or BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than distribute it to shareholders through dividends, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. ...read more
Growth Strategy: 3i Group Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 78 (better than 78% compared with alternatives) for 2023, 3i Group shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for 3i Group. Capital Growth has a rank of 90, which means that currently professionals expect the company to grow its invested capital more than 15% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 99 (above 99% 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 15. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 78, is a BUY 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 3i Group, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. ...read more
Safety Strategy: 3i Group Debt Financing Safety above-average
| SAFETY METRICS | June 22, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 78 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 9 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 73 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 58 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 58 (better than 58% compared with alternatives), the company 3i Group 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 3i Group 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 3i Group. Leverage is at a rank of 78, meaning the company has a below-average debt-to-equity ratio. It has less debt than 78% of its competitors. Liquidity is also good at a rank of 73, meaning the company generates more profit to service its debt than 73% 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 9, 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 91% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 58 (better than 58% compared with alternatives), 3i Group 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 3i Group. 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. ...read more
Combined financial peformance: 3i Group Top Financial Performance
| COMBINED PERFORMANCE | June 22, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 52 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 78 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 73 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 86 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 86 (better than 86% compared with investment alternatives), 3i Group (Asset Management & Custody, United Kingdom) shares have much better financial characteristics than comparable stocks. Shares of 3i Group are a good value (attractively priced) with a consolidated Obermatt Value Rank of 52 (better than 52% of alternatives), show above-average growth (Growth Rank of 78), and are safely financed (Safety Rank of 58), which means low debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 86, is a strong buy recommendation based on 3i Group's financial characteristics. As the company 3i Group's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 52), above-average growth (Obermatt Growth Rank of 78), and indicate that the company is safely financed (Obermatt Safety Rank of 58), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of 3i Group. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...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.