February 20, 2025
Top 10 Stock Avantor 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: Avantor – Top 10 Stock in SDG 12: Responsible Consumption and Production
Avantor is listed as a top 10 stock on February 20, 2025 in the market index SDG 12 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 31 (31% performer), Obermatt assesses an overall hold recommendation for Avantor on February 20, 2025.
Snapshot: Obermatt Ranks
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 Avantor Hold
| 360 METRICS | February 20, 2025 | |||||||
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| VALUE | ||||||||
| VALUE | 100 |
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| GROWTH | ||||||||
| GROWTH | 11 |
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| SAFETY | ||||||||
| SAFETY | 10 |
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| SENTIMENT | ||||||||
| SENTIMENT | 57 |
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| 360° VIEW | ||||||||
| 360° VIEW | 31 |
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ANALYSIS: With an Obermatt 360° View of 31 (better than 31% compared with alternatives), overall professional sentiment and financial characteristics for the stock Avantor 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 Avantor. The consolidated Value Rank has an attractive rank of 100, which means that the share price of Avantor 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 100% of alternative stocks in the same industry. The consolidated Sentiment Rank has a good rank of 57, which means that professional investors are more optimistic about the stock than for 57% of alternative investment opportunities. But the consolidated Growth Rank has a low rank of 11, 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 10, meaning the company has a riskier financing structure than 90 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 31, Avantor is worse than 69% 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 100) and positive market sentiment in the professional investor community (Sentiment Rank of 57), but growth expectations are below-average (Growth Rank of 11) and the financing structure is on the risky side(Safety Rank of 10). 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 Avantor 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 Avantor positive
ANALYSIS: With an Obermatt Sentiment Rank of 57 (better than 57% compared with alternatives), overall professional sentiment and engagement for the stock Avantor is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Avantor. Analyst Opinions are at a rank of 46 (worse than 54% 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 5, which means that stock research experts are getting even more pessimistic. Other sentiment indicators are positive: The Professional Investors rank is 85, which means that professional investors hold more stock in this company than in 85% of alternative investment opportunities. So, pros tend to favor investing in this company. In addition, Market Pulse has a rank of 78, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 78% of competitors). While stock research analysts are getting ever more critical, many professional investors are committed to Avantor and the professional news channels are on the positive side. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 57 (more positive than 57% compared with investment alternatives), Avantor has a reputation among professional investors that is above-average compared with that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical, while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: Avantor Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 100 (better than 100% compared with alternatives) for 2025, Avantor shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Avantor. Price-to-Sales is 88 which means that the stock price compared with what market professionals expect for future sales is lower than for 88% of comparable companies, indicating a good value for Avantor'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 75. Compared with other companies in the same industry, dividend yields of Avantor are expected to be higher than for 71% of all competitors (a Dividend Yield rank of 71). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 100, is a buy recommendation based on Avantor'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 Avantor based on its detailed value metrics.
Growth Strategy: Avantor Growth Momentum negative
| GROWTH METRICS | February 20, 2025 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 11 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 61 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 37 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 29 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 11 |
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ANALYSIS: With an Obermatt Growth Rank of 11 (better than 11% compared with alternatives), Avantor 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 Avantor. While Profit Growth has a good rank of 61, as professionals currently expect the company to grow its profits more than 61% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 11, which means that currently professionals expect the company to grow less than 89% of its competitors, while Capital Growth has a rank of 37 and Stock Returns have been below market median, with a rank of 29 (71% of alternative investments were better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 11, 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: Avantor Debt Financing Safety risky
| SAFETY METRICS | February 20, 2025 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 29 |
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| REFINANCING | ||||||||
| REFINANCING | 10 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 46 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 10 |
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ANALYSIS: With an Obermatt Safety Rank of 10 (better than 10% compared with alternatives), the company Avantor 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 Avantor 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 Avantor. Liquidity is at 46, meaning that the company generates less profit to service its debt than 54% 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 29, meaning the company has an above-average debt-to-equity ratio. It has more debt than 71% of its competitors. Finally, Refinancing is at a rank of 10 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 90% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 10 (worse than 90% compared with alternatives), Avantor 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: Avantor Lowest Financial Performance
| COMBINED PERFORMANCE | February 20, 2025 | |||||||
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| VALUE | ||||||||
| VALUE | 100 |
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| GROWTH | ||||||||
| GROWTH | 11 |
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| SAFETY | ||||||||
| SAFETY | 46 |
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| COMBINED | ||||||||
| COMBINED | 19 |
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ANALYSIS: With an Obermatt Combined Rank of 19 (worse than 81% compared with investment alternatives), Avantor (Life Sciences Tools & Services, USA) shares have lower financial characteristics compared with similar stocks. Shares of Avantor are a good value (attractively priced) with a consolidated Value Rank of 100 (better than 100% of alternatives) but show below-average growth (Growth Rank of 11), and are riskily financed (Safety Rank of 10), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 19, is a sell recommendation based on Avantor's financial characteristics. As the company Avantor's key financial metrics exhibit good value (Obermatt Value Rank of 100) but low growth (Obermatt Growth Rank of 11) and risky financing practices (Obermatt Safety Rank of 10), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 100% 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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