March 21, 2024
Top 10 Stock A2A 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: A2A – Top 10 Stock in Milano Italia Borsa Index MIB
A2A 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. 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 61 (high 61% performer), Obermatt assesses an overall buy recommendation for A2A on March 21, 2024.
Snapshot: Obermatt Ranks
| Country | Italy |
| Industry | Multi-Utilities |
| Index | MIB, Low Emissions, Dividends Europe, Diversity Europe, Human Rights, Sound Pay Europe |
| Size class | XX-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 A2A Buy
| 360 METRICS | March 21, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 94 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 31 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 70 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 18 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 61 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 61 (better than 61% compared with alternatives), overall professional sentiment and financial characteristics for the stock A2A are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for A2A. The consolidated Value Rank has an attractive rank of 94, which means that the share price of A2A 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 94% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 70. 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 31, 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. 69 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 61, A2A is better positioned than 61% 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 94), and the financing structure is on the safer side (Safety Rank of 70). 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 31). 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 A2A negative
ANALYSIS: With an Obermatt Sentiment Rank of 18 (better than 18% compared with alternatives), overall professional sentiment and engagement for the stock A2A is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for A2A. Analyst Opinions are at a rank of 17 (worse than 83% 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 68, 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 A2A. But the Professional Investors rank is low at 12, which means that professional investors hold less stock in this company than in 88% of alternative investment opportunities. Pros tend to invest in other companies. Market Pulse is also low at a rank of 31, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 69% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 18 (less encouraging than 82% compared with investment alternatives), A2A 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: A2A Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 94 (better than 94% compared with alternatives) for 2024, A2A shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for A2A. Price-to-Sales is 83 which means that the stock price compared with what market professionals expect for future sales is lower than for 83% of comparable companies, indicating a good value for A2A's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 83% 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 80. Compared with other companies in the same industry, dividend yields of A2A are expected to be higher than for 76% of all competitors (a Dividend Yield rank of 76). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 94, is a buy recommendation based on A2A'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 A2A based on its detailed value metrics.
Growth Strategy: A2A Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 31 (better than 31% compared with alternatives), A2A 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 three out of four indicators below average for A2A. Sales Growth has a below market rank of 16, which means that, currently, professionals expect the company to grow less than 84% of its competitors. The same is valid for Capital Growth, with a rank of 46, and Profit Growth, with a rank of 36. Currently, professionals expect the company to grow its profits less than 64% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 78, which means that the stock returns have recently been above 78% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 31, is a hold recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for A2A, 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: A2A Debt Financing Safety above-average
| SAFETY METRICS | March 21, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 39 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 77 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 69 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 70 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 70 (better than 70% compared with alternatives), the company A2A 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 A2A 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 A2A. Refinancing is at 77, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 77% of its competitors. Liquidity is also good at 69, meaning the company generates more profit to service its debt than 69% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 39, which means the company has an above-average debt-to-equity ratio. It has more debt than 61% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 70 (better than 70% compared with alternatives), A2A has a financing structure that is 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 A2A 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: A2A Top Financial Performance
| COMBINED PERFORMANCE | March 21, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 94 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 31 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 69 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 85 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 85 (better than 85% compared with investment alternatives), A2A (Multi-Utilities, Italy) shares have much better financial characteristics than comparable stocks. Shares of A2A are a good value (attractively priced) with a consolidated Value Rank of 94 (better than 94% of alternatives), are safely financed (Safety Rank of 70, which means low debt burdens), but show below-average growth (Growth Rank of 31). ...read more
RECOMMENDATION: A Combined Rank of 85, is a strong buy recommendation based on A2A's financial characteristics. As the company A2A's key financial metrics exhibit good value (Obermatt Value Rank of 94) but low growth (Obermatt Growth Rank of 31) while being safely financed (Obermatt Safety Rank of 70), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 94% 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
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.