Fact based stock research
Auto Trader Group (LSE:AUTO)
GB00BVYVFW23
How to read the free 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.
Auto Trader Group stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 51 (better than 51% compared with investment alternatives), Auto Trader Group (Interactive Media & Services, United Kingdom) shares have above-average financial characteristics compared with similar stocks. Shares of Auto Trader Group are low in value (priced high) with a consolidated Value Rank of 19 (worse than 81% of alternatives). But they show above-average growth (Growth Rank of 67) and are safely financed (Safety Rank of 77, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 51, is a buy recommendation based on Auto Trader Group's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Auto Trader Group exhibits low value (Obermatt Value Rank of 19), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 67). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 77) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: Auto Trader Group
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 5 |
|
31 |
|
21 |
|
19 |
|
| GROWTH | ||||||||
| GROWTH | 79 |
|
77 |
|
73 |
|
67 |
|
| SAFETY | ||||||||
| SAFETY | 69 |
|
77 |
|
75 |
|
77 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
35 |
|
41 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
67 |
|
55 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 51 (better than 51% compared with investment alternatives), Auto Trader Group (Interactive Media & Services, United Kingdom) shares have above-average financial characteristics compared with similar stocks. Shares of Auto Trader Group are low in value (priced high) with a consolidated Value Rank of 19 (worse than 81% of alternatives). But they show above-average growth (Growth Rank of 67) and are safely financed (Safety Rank of 77, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 51, is a buy recommendation based on Auto Trader Group's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Auto Trader Group exhibits low value (Obermatt Value Rank of 19), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 67). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 77) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 5 |
|
31 |
|
21 |
|
19 |
|
| GROWTH | ||||||||
| GROWTH | 79 |
|
77 |
|
73 |
|
67 |
|
| SAFETY | ||||||||
| SAFETY | 69 |
|
77 |
|
75 |
|
77 |
|
| COMBINED | ||||||||
| COMBINED | 6 |
|
84 |
|
77 |
|
51 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 19 (worse than 81% compared with alternatives), Auto Trader Group shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Auto Trader Group. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 55% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 6 which means that the stock price compared with what market professionals expect for future profits is higher than 94% of comparable companies, indicating a low value concerning Auto Trader Group's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 34 which means that the stock price compared with what market professionals expect for future profit levels is higher than 66% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 13 is also low. Compared with invested capital, the stock price is higher than for 87% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 19, is a sell recommendation based on Auto Trader Group's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Auto Trader Group? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose Auto Trader Group only if they reasonably expect the low current profit levels to be transitory. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more
| VALUE METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| PRICE VS. REVENUES (P/S) | ||||||||
| PRICE VS. REVENUES (P/S) | 7 |
|
7 |
|
5 |
|
6 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 51 |
|
54 |
|
34 |
|
34 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 4 |
|
20 |
|
17 |
|
13 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 72 |
|
61 |
|
55 |
|
55 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 5 |
|
31 |
|
21 |
|
19 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 67 (better than 67% compared with alternatives), Auto Trader Group shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Auto Trader Group. Capital Growth has a rank of 90, which means that currently professionals expect the company to grow its invested capital more than 45% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 55 (above 55% of alternative investments). But Sales Growth has only a rank of 42, which means that, currently, professionals expect the company to grow less than 58% of its competitors, and Profit Growth is also low at a rank of 45. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 67, 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 Auto Trader Group, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 53 |
|
26 |
|
40 |
|
42 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 84 |
|
75 |
|
56 |
|
45 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
63 |
|
78 |
|
90 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 57 |
|
81 |
|
73 |
|
55 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 79 |
|
77 |
|
73 |
|
67 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 77 (better than 77% compared with alternatives) for 2024, the company Auto Trader Group has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Auto Trader 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 Auto Trader Group. Leverage is at a rank of 80, meaning the company has a below-average debt-to-equity ratio. It has less debt than 80% of its competitors. Liquidity is also good at a rank of 85, meaning the company generates more profit to service its debt than 85% 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 31, 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 69% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 77 (better than 77% compared with alternatives), Auto Trader Group has a financing structure that is significantly 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 Auto Trader 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. Investors may have a short-term debt challenge with Auto Trader Group and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 45 |
|
75 |
|
68 |
|
80 |
|
| REFINANCING | ||||||||
| REFINANCING | 62 |
|
23 |
|
35 |
|
31 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 90 |
|
79 |
|
85 |
|
85 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 69 |
|
77 |
|
75 |
|
77 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
15 |
|
24 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
50 |
|
74 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
96 |
|
60 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
20 |
|
31 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
35 |
|
41 |
|
new |
|
Free stock analysis by the purely fact based Obermatt Method for Auto Trader Group from November 14, 2024.
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