November 14, 2024
Top 10 Stock AmerisourceBergen 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: AmerisourceBergen – Top 10 Stock in Dow Jones U.S. Health Care Providers Index
AmerisourceBergen is listed as a top 10 stock on November 14, 2024 in the market index D.J. US Health Care because of its high performance in at least one of the Obermatt investment strategies. While only half of the consolidated Obermatt Ranks exhibit above-average performance, the professional market sentiment is positive and it may be a solid investment proposition, especially if a growth recovery is to be expected soon. Based on the Obermatt 360° View of 70 (high 70% performer), Obermatt assesses an overall buy recommendation for AmerisourceBergen on November 14, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Health Care Distributors |
| Index | Dividends USA, Diversity USA, Recycling, D.J. US Health Care, S&P 500 |
| 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 AmerisourceBergen Buy
| 360 METRICS | November 14, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 75 |
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| GROWTH | ||||||||
| GROWTH | 45 |
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| SAFETY | ||||||||
| SAFETY | 20 |
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| SENTIMENT | ||||||||
| SENTIMENT | 91 |
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| 360° VIEW | ||||||||
| 360° VIEW | 70 |
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ANALYSIS: With an Obermatt 360° View of 70 (better than 70% compared with alternatives), overall professional sentiment and financial characteristics for the stock AmerisourceBergen are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for AmerisourceBergen. The consolidated Value Rank has an attractive rank of 75, which means that the share price of AmerisourceBergen is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 75% of alternative stocks in the same industry. The consolidated Sentiment Rank has a good rank of 91, which means that professional investors are more optimistic about the stock than for 91% of alternative investment opportunities. But the consolidated Growth Rank has a low rank of 45, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. The consolidated Safety Rank has a riskier rank of 20, meaning the company has a riskier financing structure than 80 comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. ...read more
RECOMMENDATION: With a consolidated 360° View of 70, AmerisourceBergen is better positioned than 70% of all alternative stock investment opportunities based on the Obermatt Method. Half of the consolidated Obermatt Ranks exhibit above-average performance, but the other half are below market levels. The company enjoys a good value (Value Rank of 75) and positive market sentiment in the professional investor community (Sentiment Rank of 91), but growth expectations are below-average (Growth Rank of 45) and the financing structure is on the risky side(Safety Rank of 20). This combination is rather dangerous, because high debt levels (low safety) require growth to finance the debt burden. The current low growth level may be temporary, because professionals are actually optimistic (positive sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. Companies with less growth typically have a lower price than fast-growing competitors. Even though professional investor sentiment is strong, we recommend further evaluating whether the future of AmerisourceBergen is as challenging as the stock's low price suggests. Since the professional community is optimistic, the stock might just be going through a more challenging phase now, indicating that timing might be good now. ...read more
Sentiment Strategy: Professional Market Sentiment for AmerisourceBergen very positive
ANALYSIS: With an Obermatt Sentiment Rank of 91 (better than 91% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock AmerisourceBergen is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for AmerisourceBergen. Analyst Opinions are at a rank of 45 (worse than 55% 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 74, which indicates a shift in stock research experts opinions for the better. In other words, they are getting more optimistic about stock investments in AmerisourceBergen. Even better, the Professional Investors rank is 91, meaning that professional investors hold more stock in this company than in 91% of alternative investment opportunities. Pros tend to favor investing in this company. Furthermore, Market Pulse has a rank of 92, which means that the current professional news and professional social networks are upbeat when discussing this company (more positive news than for 92% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 91 (more positive than 91% compared with investment alternatives), AmerisourceBergen has a reputation among professional investors that is significantly higher than that of its competitors. While analysts are still critical of the company, some are changing their minds. In addition, the professional news channels are optimistic, and many institutional investors have already bought stock in the company. These are encouraging signals, despite the still lower level of analyst recommendations. They may be due to a problematic past, and about to change. The positive sentiment signals are stronger than the negative. ...read more
Value Strategy: AmerisourceBergen Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 75 (better than 75% compared with alternatives) for 2024, AmerisourceBergen 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 AmerisourceBergen. Price-to-Sales (P/S) is 91, which means that the stock price compared with what market professionals expect for future sales is lower than for 91% of comparable companies, indicating a good value concerning AmerisourceBergen's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 61% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 79 (dividends are expected to be higher than 79% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 97% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for AmerisourceBergen to 3. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 75, is a buy recommendation based on AmerisourceBergen's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner in assets than its competitors. For instance, the company could be leasing its production facilities or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the three good value ranks for Sales, Profits, and Dividends are reliable indicators for the stock price value. ...read more
Growth Strategy: AmerisourceBergen Growth Momentum low
| GROWTH METRICS | November 14, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 51 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 45 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 19 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 63 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 45 |
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ANALYSIS: With an Obermatt Growth Rank of 45 (better than 45% compared with alternatives), AmerisourceBergen 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 half of the indicators below and half above average for AmerisourceBergen. Sales Growth has a rank of 51 which means that currently professionals expect the company to grow more than 51% of its competitors. Stock Returns are also above average with a rank of 63. But Capital Growth has only a rank of 19, which means that currently professionals expect the company to grow its invested capital less than 81% of its competitors. Profit Growth is also low, with a rank of only 45, which means that, currently, professionals expect the company to grow its profits below average. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 45, is a hold recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 63% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. ...read more
Safety Strategy: AmerisourceBergen Debt Financing Safety risky
| SAFETY METRICS | November 14, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 10 |
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| REFINANCING | ||||||||
| REFINANCING | 4 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 94 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 20 |
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ANALYSIS: With an Obermatt Safety Rank of 20 (better than 20% compared with alternatives), the company AmerisourceBergen 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 AmerisourceBergen 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 just one indicator above average for AmerisourceBergen. Liquidity is at 94, meaning the company generates more profit to service its debt than 94% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 4, 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 96% of its competitors. Leverage is also high at a rank of 10, which means that the company has an above-average debt-to-equity ratio. It has more debt than 90% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 20 (worse than 80% compared with alternatives), AmerisourceBergen has a financing structure that is significantly riskier 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: AmerisourceBergen Below-Average Financial Performance
| COMBINED PERFORMANCE | November 14, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 75 |
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| GROWTH | ||||||||
| GROWTH | 45 |
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| SAFETY | ||||||||
| SAFETY | 94 |
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| COMBINED | ||||||||
| COMBINED | 34 |
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ANALYSIS: With an Obermatt Combined Rank of 34 (worse than 66% compared with investment alternatives), AmerisourceBergen (Health Care Distributors, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of AmerisourceBergen are a good value (attractively priced) with a consolidated Value Rank of 75 (better than 75% of alternatives) but show below-average growth (Growth Rank of 45), and are riskily financed (Safety Rank of 20), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 34, is a hold recommendation based on AmerisourceBergen's financial characteristics. As the company AmerisourceBergen's key financial metrics exhibit good value (Obermatt Value Rank of 75) but low growth (Obermatt Growth Rank of 45) and risky financing practices (Obermatt Safety Rank of 20), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 75% of comparable companies, may indicate 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. ...read more
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