October 31, 2024
Top 10 Stock Alstom Sell 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: Alstom – Top 10 Stock in Cotation Assistée en Continu Index CAC 40
Alstom is listed as a top 10 stock on October 31, 2024 in the market index CAC 40 because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company is growing above average, but all other facts speak against a stock purchase, especially the low market sentiment by professional investors. Based on the Obermatt 360° View of 14 (14% performer), Obermatt issues an overall sell recommendation for Alstom on October 31, 2024.
Snapshot: Obermatt Ranks
| Country | France |
| Industry | Heavy Machinery |
| Index | CAC 40, CAC All, SBF 120, Human Rights |
| 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 Alstom Sell
| 360 METRICS | October 31, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 46 |
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| GROWTH | ||||||||
| GROWTH | 94 |
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| SAFETY | ||||||||
| SAFETY | 1 |
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| SENTIMENT | ||||||||
| SENTIMENT | 14 |
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| 360° VIEW | ||||||||
| 360° VIEW | 14 |
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ANALYSIS: With an Obermatt 360° View of 14 (better than 14% compared with alternatives), overall professional sentiment and financial characteristics for the stock Alstom are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Alstom. The consolidated Growth Rank has a good rank of 94, 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. It ranks higher than 94% of competitors in the same industry. The other indicators are below average, namely the Value, Safety, and Sentiment Ranks.The Value Rank at 46 means that the share price of Alstom is on the high side compared with its peers regarding revenues, profits, and invested capital. The stock price is higher than for 54% of alternative stocks in the same industry. The consolidated Safety Rank has a riskier rank of 1, which means that the company has a riskier financing structure than 99% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. The consolidated Sentiment Rank also has a low rank of 14, indicating professional investors are more pessimistic about the stock than for 86% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 14, Alstom is worse than 86% of all alternative stock investment opportunities based on the Obermatt Method. This means that Alstom shares are on the riskier side for investors. As only one of the consolidated Obermatt Ranks exhibits excellent performance, namely the above-average growth (Growth Rank of 94), it is a riskier stock investment proposition. Aside from the critical professional market sentiment (Sentiment Rank of 14), the company is rather risky when it comes to financing (Safety Rank of 1). The negative market view on Alstom may be due to the high stock price (low value). A growth company like this may get too expensive at one point in time. If too many investors are desperate to join the party, they may drive stock prices above reasonable levels. While it is typical for growth companies to have low value, because investors are willing to pay more for companies that are expected to have high growth, the crucial question is: how much more do you pay for the stock of Alstom compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one minus the growth rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value (even though it is lower than 50). As market sentiment is critical, you should be careful with paying more than market-average for this stock and conduct further research into the company's future growth potential. ...read more
Sentiment Strategy: Professional Market Sentiment for Alstom negative
ANALYSIS: With an Obermatt Sentiment Rank of 14 (better than 14% compared with alternatives), overall professional sentiment and engagement for the stock Alstom 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 Alstom. Analyst Opinions are at a rank of 41 (worse than 59% 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 28 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 20, 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 80% 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 Alstom, 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 14 (less encouraging than 86% compared with investment alternatives), Alstom 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: Alstom Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 46 (worse than 54% compared with alternatives), Alstom shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Alstom. Price-to-Sales (P/S) is 65, which means that the stock price compared with what market professionals expect for future sales is lower than for 65% of comparable companies, indicating a good value regarding Alstom's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 53% 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 80. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 25% of all competitors have even lower dividend yields than Alstom (a Dividend Yield Rank of 25). 75% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 46, is a hold recommendation based on Alstom'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: Alstom Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 94 (better than 94% compared with alternatives) for 2024, Alstom 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 all four indicators above average for Alstom. Sales Growth has a value of 52, which means that, currently, professionals expect the company to grow more than 52% of its competitors. The same is valid for Profit Growth with a value of 96 and for Capital Growth with 65. In addition, Stock Returns had an above-average rank value of 92, which means they have been higher than 92% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 94, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Alstom exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. ...read more
Safety Strategy: Alstom Debt Financing Safety risky
| SAFETY METRICS | October 31, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 41 |
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| REFINANCING | ||||||||
| REFINANCING | 1 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 14 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 1 |
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ANALYSIS: With an Obermatt Safety Rank of 1 (better than 1% compared with alternatives), the company Alstom has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Alstom is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with all three metrics below average for Alstom. Liquidity is at 14, meaning that the company generates less profit to service its debt than 86% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 41, meaning the company has an above-average debt-to-equity ratio. It has more debt than 59% of its competitors. Finally, Refinancing is at a rank of 1 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 99% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 1 (worse than 99% compared with alternatives), Alstom has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing.
Combined financial peformance: Alstom Below-Average Financial Performance
| COMBINED PERFORMANCE | October 31, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 46 |
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| GROWTH | ||||||||
| GROWTH | 94 |
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| SAFETY | ||||||||
| SAFETY | 14 |
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| COMBINED | ||||||||
| COMBINED | 39 |
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ANALYSIS: With an Obermatt Combined Rank of 39 (worse than 61% compared with investment alternatives), Alstom (Heavy Machinery, France) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Alstom are low in value (priced high) with a consolidated Value Rank of 46 (worse than 54% of alternatives), and are riskily financed (Safety Rank of 1, which means above-average debt burdens) but show above-average growth (Growth Rank of 94). ...read more
RECOMMENDATION: A Combined Rank of 39, is a hold recommendation based on Alstom's financial characteristics. As the company Alstom shows low value with an Obermatt Value Rank of 46 (54% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 94% of comparable companies (Obermatt Growth Rank is 94). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 1 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Alstom, even a low-value company (in terms of its key financial indicators) can be a good investment. ...read more
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