Fact based stock research
Balfour Beatty (LSE:BBY)

GB0000961622

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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).

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Balfour Beatty stock research in summary

balfourbeatty.com

ANALYSIS: With an Obermatt Combined Rank of 43 (worse than 57% compared with investment alternatives), Balfour Beatty (Construction & Engineering, United Kingdom) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Balfour Beatty are low in value (priced high) with a consolidated Value Rank of 43 (worse than 57% of alternatives), and are riskily financed (Safety Rank of 41, which means above-average debt burdens) but show above-average growth (Growth Rank of 57). ...read more

RECOMMENDATION: A Combined Rank of 43, is a hold recommendation based on Balfour Beatty's financial characteristics. As the company Balfour Beatty shows low value with an Obermatt Value Rank of 43 (57% 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 57% of comparable companies (Obermatt Growth Rank is 57). 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 41 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 Balfour Beatty, even a low-value company (in terms of its key financial indicators) can be a good investment. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	43
Growth Rank	57
Safety Rank	41
Combined Rank	43

Country	United Kingdom
Industry	Construction & Engineering
Index	FTSE All Shares, FTSE 250, FTSE 350, Customer Focus EU, Employee Focus EU, Human Rights, SDG 11, SDG 12, SDG 13, SDG 8, SDG 9, Water Tech
Size class	X-Large

This stock has achievements: Top 10 Stock.

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Balfour Beatty

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	23	53	75	43
GROWTH
GROWTH	1	47	5	57
SAFETY
SAFETY	46	23	34	41
SENTIMENT
SENTIMENT	n/a	56	93	^new
360° VIEW
360° VIEW	n/a	33	56	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 28-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Balfour Beatty is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	23	53	75	43
GROWTH
GROWTH	1	47	5	57
SAFETY
SAFETY	46	23	34	41
COMBINED
COMBINED	17	37	29	43

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Balfour Beatty the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 43 (worse than 57% compared with alternatives), Balfour Beatty shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where the majority of metrics are below, and only one is above average for Balfour Beatty. Price-to-Sales (P/S) is 77, which means that the stock price compared with what market professionals expect for future sales is lower than 77% of comparable companies, indicating a good value concerning to Balfour Beatty's revenue size. But all other performance indicators point in a different direction. Dividend yields have a Dividend Yield rank of 34, meaning that dividends are expected to be lower than for 66% of comparable investments. Furthermore, Price-to-Book Capital (also referred to as market-to-book ratio) is less favorable than 55% of alternatives (only 45% of peers have an even higher ratio). The same is valid for Price-to-Profit (or Price / Earnings, P/E), which is higher than for 51% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 43, is a hold recommendation based on Balfour Beatty's stock price compared with the company's operational size and dividend yields. Since Price-to-Sales is a stable value indicator even in challenging times, investing in Balfour Beatty could be seen as a value investment. However, there must be a good reason for the low market-to-book rank. If the company has a typical capital investment practice, the stock may be overvalued because the profit and dividend-related performance indicators are also low. The stock is only good value if investors can expect profits and dividends to pick up in the future. Else, Balfour Beatty looks like an expensive investment today. 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 especially important 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)	73	81	81	77
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	27	64	69	49
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	43	67	62	45
DIVIDEND YIELD
DIVIDEND YIELD	22	39	56	34
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	23	53	75	43

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Balfour Beatty; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 57 (better than 57% compared with alternatives), Balfour Beatty 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 Balfour Beatty. Sales Growth has a rank of 69 which means that currently professionals expect the company to grow more than 69% of its competitors. Stock Returns are also above average with a rank of 81. But Capital Growth has only a rank of 17, which means that currently professionals expect the company to grow its invested capital less than 83% of its competitors. Profit Growth is also low, with a rank of only 47, 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 57, is a buy 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 81% 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. 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	7	34	17	69
PROFIT GROWTH
PROFIT GROWTH	79	98	15	47
CAPITAL GROWTH
CAPITAL GROWTH	n/a	31	21	17
STOCK RETURNS
STOCK RETURNS	16	17	23	81
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	1	47	5	57

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Balfour Beatty.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 41 (better than 41% compared with alternatives), the company Balfour Beatty has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Balfour Beatty 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 Balfour Beatty and the other two below average. Leverage is at a rank of 50 meaning the company has a below-average debt-to-equity ratio. It has less debt than 50% of its competitors.Refinancing is at a rank of 33, which means that the portion of the debt about to be refinanced is above-average. It has more debt in the refinancing stage than 67% of its competitors. Liquidity is at a rank of 39, meaning that the company generates less profit to service its debt than 61% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 41 (worse than 59% compared with alternatives), Balfour Beatty has a financing structure that is riskier than that of its competitors. This is an indication that the company is on the riskier side when it comes to debt service. There is only below-market average liquidity, and a short-term refinancing issue might be around the corner. But in the long-term, the debt levels of Balfour Beatty are on the safer side. Investors may have a short-term debt challenge and liquidity issues with Balfour Beatty 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	64	72	68	50
REFINANCING
REFINANCING	14	11	18	33
LIQUIDITY
LIQUIDITY	31	16	30	39
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	46	23	34	41

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Balfour Beatty and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	75	97	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	98	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	13	42	^new
MARKET PULSE
MARKET PULSE	n/a	79	73	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	56	93	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Balfour Beatty.
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