August 10, 2023
Top 10 Stock ACEA 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: ACEA – Top 10 Stock in Milano Italia Borsa Index MIB
ACEA is listed as a top 10 stock on August 10, 2023 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 48 (48% performer), Obermatt assesses an overall hold recommendation for ACEA on August 10, 2023.
Snapshot: Obermatt Ranks
| Country | Italy |
| Industry | Multi-Utilities |
| Index | MIB, Dividends Europe, Energy Efficient, Sound Pay Europe, Water Tech |
| 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 ACEA Hold
| 360 METRICS | August 10, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 98 |
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| GROWTH | ||||||||
| GROWTH | 13 |
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| SAFETY | ||||||||
| SAFETY | 61 |
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| SENTIMENT | ||||||||
| SENTIMENT | 10 |
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| 360° VIEW | ||||||||
| 360° VIEW | 48 |
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ANALYSIS: With an Obermatt 360° View of 48 (better than 48% compared with alternatives), overall professional sentiment and financial characteristics for the stock ACEA 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 ACEA. The consolidated Value Rank has an attractive rank of 98, which means that the share price of ACEA 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 98% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 61. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 10. Professional investors are more confident in 90% other stocks. The consolidated Growth Rank also has a low rank of 13, 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. 87 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 48, ACEA is worse than 52% 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 98), and the financing structure is on the safer side (Safety Rank of 61). However, sentiment in the professional investor community is below-average (Sentiment Rank of 10), as is the growth momentum for the company (Growth Rank of 13). 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 ACEA negative
ANALYSIS: With an Obermatt Sentiment Rank of 10 (better than 10% compared with alternatives), overall professional sentiment and engagement for the stock ACEA is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for ACEA. Analyst Opinions are at a rank of 40 (worse than 60% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 24 which means that stock research experts are getting even more pessimistic. It doesn't end with the analysts. Market Pulse is also low with a rank of 15, 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 85% of competitors). No wonder, the Professional Investors rank is only 42, which means that professional investors hold less stock in this company than in 58% of alternative investment opportunities. Pros tend to stay away from ACEA, which may be due to a small company size but just as likely because of its relatively low Sentiment Rank. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 10 (less encouraging than 90% compared with investment alternatives), ACEA has a reputation among professional investors that is far below that of its competitors. Investors should be careful with this stock right now. Further research is required if an investment is desired, because the facts found in the professional community are all negative. ...read more
Value Strategy: ACEA Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 98 (better than 98% compared with alternatives) for 2023, ACEA shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for ACEA. Price-to-Sales is 72 which means that the stock price compared with what market professionals expect for future sales is lower than for 72% of comparable companies, indicating a good value for ACEA's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 91% 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 90. Compared with other companies in the same industry, dividend yields of ACEA are expected to be higher than for 94% of all competitors (a Dividend Yield rank of 94). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 98, is a buy recommendation based on ACEA'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 ACEA based on its detailed value metrics.
Growth Strategy: ACEA Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 13 (better than 13% compared with alternatives), ACEA 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 metrics below average for ACEA. While Profit Growth has a good rank of 50, as professionals currently expect the company to grow its profits more than 50% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 23, which means that currently professionals expect the company to grow less than 77% of its competitors, while Capital Growth has a rank of 37 and Stock Returns have been below market median, with a rank of 27 (73% of alternative investments were better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 13, is a sell recommendation for growth and momentum investors. While revenue growth and capital growth are good growth momentum indicators, profit is less reliable, because profits may increase due to cost-cutting measures which typically indicate negative growth momentum. "You can save a dollar only once" is the saying about such situations. Growth Investors should look at company priorities closely if they are interested in growth, because the increase in profits is not usually an indicator of growth, and stock prices have been below market, too. ...read more
Safety Strategy: ACEA Debt Financing Safety above-average
| SAFETY METRICS | August 10, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 32 |
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| REFINANCING | ||||||||
| REFINANCING | 41 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 69 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 61 |
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ANALYSIS: With an Obermatt Safety Rank of 61 (better than 61% compared with alternatives), the company ACEA 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 ACEA 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 just one indicator above average for ACEA. Liquidity is 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. But Refinancing is riskier at a rank of 41, 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 59% of its competitors. Leverage is also high at a rank of 32, which means that the company has an above-average debt-to-equity ratio. It has more debt than 68% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 61 (better than 61% compared with alternatives), ACEA has a financing structure that is safer 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: ACEA Above-Average Financial Performance
| COMBINED PERFORMANCE | August 10, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 98 |
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| GROWTH | ||||||||
| GROWTH | 13 |
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| SAFETY | ||||||||
| SAFETY | 69 |
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| COMBINED | ||||||||
| COMBINED | 68 |
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ANALYSIS: With an Obermatt Combined Rank of 68 (better than 68% compared with investment alternatives), ACEA (Multi-Utilities, Italy) shares have above-average financial characteristics compared with similar stocks. Shares of ACEA are a good value (attractively priced) with a consolidated Value Rank of 98 (better than 98% of alternatives), are safely financed (Safety Rank of 61, which means low debt burdens), but show below-average growth (Growth Rank of 13). ...read more
RECOMMENDATION: A Combined Rank of 68, is a buy recommendation based on ACEA's financial characteristics. As the company ACEA's key financial metrics exhibit good value (Obermatt Value Rank of 98) but low growth (Obermatt Growth Rank of 13) while being safely financed (Obermatt Safety Rank of 61), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 98% 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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