November 21, 2024
Top 10 Stock Barloworld 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: Barloworld – Top 10 Stock in Johannesburg Securities Exchange All Shares Index JSE All Shares
Barloworld is listed as a top 10 stock on November 21, 2024 in the market index JSE All Shares because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 58 (high 58% performer), Obermatt assesses an overall buy recommendation for Barloworld on November 21, 2024.
Snapshot: Obermatt Ranks
| Country | South Africa |
| Industry | Trading & Distribution |
| Index | Low Emissions, Good Governace Growth Markets, Independent Boards Growth Markets, JSE All Shares |
| Size class | 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 Barloworld Buy
| 360 METRICS | November 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 95 |
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| GROWTH | ||||||||
| GROWTH | 25 |
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| SAFETY | ||||||||
| SAFETY | 51 |
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| SENTIMENT | ||||||||
| SENTIMENT | 40 |
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| 360° VIEW | ||||||||
| 360° VIEW | 58 |
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ANALYSIS: With an Obermatt 360° View of 58 (better than 58% compared with alternatives), overall professional sentiment and financial characteristics for the stock Barloworld are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Barloworld. The consolidated Value Rank has an attractive rank of 95, which means that the share price of Barloworld is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 95% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 51. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 40. Professional investors are more confident in 60% other stocks. The consolidated Growth Rank also has a low rank of 25, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 75 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 58, Barloworld is better positioned than 58% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 95), and the financing structure is on the safer side (Safety Rank of 51). However, sentiment in the professional investor community is below-average (Sentiment Rank of 40), as is the growth momentum for the company (Growth Rank of 25). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for Barloworld only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 40 (better than 40% compared with alternatives), overall professional sentiment and engagement for the stock Barloworld is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the indicators below and above average for Barloworld. Analyst Opinions are at a rank of 14 (worse than 86% 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 50 which means that stock research experts are changing their opinions for the better. In other words, they are getting more optimistic of stock investments in Barloworld. Market Pulse is also positive with a rank of 73, which means that the current professional news and professional social networks are positive in their discussions about this company (more positive news than for 73% of competitors). Only professional investors tend to be absent with a Professional Investors rank of 41, which means that professional investors hold less stock in this company than in 59% of alternative investment opportunities. Pros tend to invest in other companies. But that could also be due to the size of the company. Professional investors tend to invest in XL and XXL companies. If the company is smaller than that, that fact alone may explain why there are fewer pros present. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 40 (less encouraging than 60% compared with investment alternatives), Barloworld has a reputation among professional investors that is below that of its competitors. Since analysts are getting more optimistic and the professional communication channels are positive, it may be an indication of a company that has the difficult times behind it or the stocks’ value is improving. For medium to smaller companies, the positive sentiment indicators outshine the negative. ...read more
Value Strategy: Barloworld Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 95 (better than 95% compared with alternatives) for 2024, Barloworld shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Barloworld. Price-to-Sales is 82 which means that the stock price compared with what market professionals expect for future sales is lower than for 82% of comparable companies, indicating a good value for Barloworld's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 82% 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 78. Compared with other companies in the same industry, dividend yields of Barloworld are expected to be higher than for 94% of all competitors (a Dividend Yield rank of 94). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 95, is a buy recommendation based on Barloworld'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 Barloworld based on its detailed value metrics.
Growth Strategy: Barloworld Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 25 (better than 25% compared with alternatives), Barloworld 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 Barloworld. Capital Growth has a rank of 69, which means that currently professionals expect the company to grow its invested capital more than 14% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 59 (above 59% of alternative investments). But Sales Growth has only a rank of 4, which means that, currently, professionals expect the company to grow less than 96% of its competitors, and Profit Growth is also low at a rank of 14. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 25, is a hold 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 Barloworld, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. ...read more
Safety Strategy: Barloworld Debt Financing Safety above-average
| SAFETY METRICS | November 21, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 38 |
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| REFINANCING | ||||||||
| REFINANCING | 79 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 36 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 51 |
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ANALYSIS: With an Obermatt Safety Rank of 51 (better than 51% compared with alternatives), the company Barloworld has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Barloworld 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 just one indicator above average for Barloworld and the other two below average. Refinancing is at 79, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 79% of its competitors. But Leverage is high with a rank of 38, meaning the company has an above-average debt-to-equity ratio. It has more debt than 62% of its competitors. Liquidity is also on the riskier side with a rank of 36, meaning the company generates less profit to service its debt than 64% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 51 (better than 51% compared with alternatives), Barloworld has a financing structure that is safer than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Barloworld are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. ...read more
Combined financial peformance: Barloworld Top Financial Performance
| COMBINED PERFORMANCE | November 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 95 |
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| GROWTH | ||||||||
| GROWTH | 25 |
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| SAFETY | ||||||||
| SAFETY | 36 |
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| COMBINED | ||||||||
| COMBINED | 75 |
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ANALYSIS: With an Obermatt Combined Rank of 75 (better than 75% compared with investment alternatives), Barloworld (Trading & Distribution, South Africa) shares have much better financial characteristics than comparable stocks. Shares of Barloworld are a good value (attractively priced) with a consolidated Value Rank of 95 (better than 95% of alternatives), are safely financed (Safety Rank of 51, which means low debt burdens), but show below-average growth (Growth Rank of 25). ...read more
RECOMMENDATION: A Combined Rank of 75, is a strong buy recommendation based on Barloworld's financial characteristics. As the company Barloworld's key financial metrics exhibit good value (Obermatt Value Rank of 95) but low growth (Obermatt Growth Rank of 25) while being safely financed (Obermatt Safety Rank of 51), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 95% of comparable companies, may also indicate that 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 and the downside is limited due to below-average financing risks. ...read more
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