October 24, 2024
Top 10 Stock Barratt Developments Strong 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: Barratt Developments – Top 10 Stock in Customer Satisfaction Leaders in Europe
Barratt Developments is listed as a top 10 stock on October 24, 2024 in the market index Customer Focus EU because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. While the company shows high growth, the stock price is high yet professional investor sentiment is low, which may be due to overly optimistic investor behavior, reflected in a low stock price value. Based on the Obermatt 360° View of 77 (top 77% performer), Obermatt assesses an overall strong buy recommendation for Barratt Developments on October 24, 2024.
Snapshot: Obermatt Ranks
| Country | United Kingdom |
| Industry | Homebuilding |
| Index | FTSE All Shares, FTSE 100, FTSE 350, Customer Focus EU, Water Tech |
| Size class | X-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 Barratt Developments Strong Buy
| 360 METRICS | October 24, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 47 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 74 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 92 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 41 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 77 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 77 (better than 77% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock Barratt Developments are very positive. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Barratt Developments. The consolidated Growth Rank has a good rank of 74, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. This means that growth is higher than for 74% of competitors in the same industry. In addition, the consolidated Safety Rank has a safer rank of 92 which means that the company has a financing structure that is safer than 92% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the consolidated Value Rank has a less desirable rank of 47 which means that the share price of Barratt Developments is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is higher than for 53% of alternative stocks in the same industry. The consolidated Sentiment Rank also has a low rank of 41, which means that professional investors are more pessimistic about the stock than for 59% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 77, Barratt Developments is better positioned than 77% of all alternative stock investment opportunities based on the Obermatt Method. As only half of the consolidated Obermatt Ranks exhibit excellent performance, the picture is ambiguous. Growth is above-average (Growth Rank of 74), and the company is safely financed (Safety Rank of 92). However, professional market sentiment is low(Sentiment Rank of 41). The negative market view on Barratt Developments may be due to the high stock price (low value). A growth company like this may get too expensive at one point in time. If too many investors are desperate to board the train, they may drive stock prices above reasonable levels. It is typical for growth companies to have low value ratings, because investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of Barratt Developments compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one hundred minus the growth rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value if the value rank is above 60. As market sentiment is low, you should be careful with paying more than market-average for this stock and conduct further research into the company’s future growth potential. ...read more
Sentiment Strategy: Professional Market Sentiment for Barratt Developments only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 41 (better than 41% compared with alternatives), overall professional sentiment and engagement for the stock Barratt Developments is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Barratt Developments. Analyst Opinions are at a rank of 49 (worse than 51% 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 57, which means that stock research experts are more positive in their investment recommendations in the company. In other words, they are getting more optimistic of stock investments in Barratt Developments. More encouragingly, the Professional Investors rank is 58, which means that professional investors hold more stock in this company than in 58% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 23, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 77% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 41 (less encouraging than 59% compared with investment alternatives), Barratt Developments has a reputation among professional investors that is below that of its competitors. The sentiment signals are mixed for Barratt Developments. While analysts and the news channels are negative, there is a change in what analysts think. Above-average institutional investors in this company support them. Sentiment signals remain mixed with analysts and news channels pessimistic, though improving, and professional investors above average. ...read more
Value Strategy: Barratt Developments Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 47 (worse than 53% compared with alternatives), Barratt Developments shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Barratt Developments. Expected dividend yields are higher than for 56% of comparable companies (a Dividend Yield rank of 56), making the stock attractive. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 76, which means that the stock price is lower compared with invested capital than for 76% of comparable investments. But in respect to sales and profits, the picture is reversed. Price-to-Sales is 30 which means that the stock price compared with what market professionals expect for future profits is higher than for 70% of comparable companies, indicating a low value concerning Barratt Developments's sales levels. The Price-to-Profit ratio (also referred to as price-earnings (P/E) ratio) is also unfavorable for Barratt Developments with a rank of 39. This means that the stock price, compared with what market professionals expect for future profits, is higher than for 61% of comparable companies, indicating a low value concerning Barratt Developments's profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 47, is a hold recommendation based on Barratt Developments's stock price compared with the company's operational size and dividend yields. The company seems confident that it can generate a reasonable return on invested capital, because it pays an above-average dividend while profits are below what you would expect for a company with this stock price. If you agree with this practice and believe that profits will return to higher levels, as the current dividend policy suggests, Barratt Developments may be an attractive investment. If this is not the case, you may want to be careful with this stock as it is also expensive compared with its expected revenue levels. ...read more
Growth Strategy: Barratt Developments Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 74 (better than 74% compared with alternatives), Barratt Developments 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 Barratt Developments. Sales Growth has a rank of 98, which means that, currently, professionals expect the company to grow more than 98% of its competitors. Profit Growth with a rank of 89 is also above average. But Capital Growth has only a rank of 24, and Stock Returns with 41 are also below-average. Stock returns for Barratt Developments have recently been below 59% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 74, is a buy recommendation for growth and momentum investors. Are investors forecasting troubles based on the lack of operating investment activity at the company? This could be one explanation as to why stock returns are low. But stock returns can also be the result of correcting an error in the past, in this case, an overly optimistic outlook on the future, which is now more realistic. The Value Ranks may confirm such a picture. The more important growth indicators are revenues and profits, which are both above average for Barratt Developments. This is a positive sign from the company's operational side and may give investors courage, despite the poor recent stock price performance. ...read more
Safety Strategy: Barratt Developments Debt Financing Safety very solid
| SAFETY METRICS | October 24, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 89 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 75 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 82 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 92 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 92 (better than 92% compared with alternatives) for 2024, the company Barratt Developments has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Barratt Developments 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, where all three are above average for Barratt Developments. Leverage is at 89, meaning the company has a below-average debt-to-equity ratio. It has less debt than 89% of its competitors. Refinancing is at a rank of 75, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 75% of its competitors. Finally, Liquidity is also good at a rank of 82, which means that the company generates more profit to service its debt than 82% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 92 (better than 92% compared with alternatives), Barratt Developments has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more
Combined financial peformance: Barratt Developments Top Financial Performance
| COMBINED PERFORMANCE | October 24, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 47 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 74 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 82 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 88 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 88 (better than 88% compared with investment alternatives), Barratt Developments (Homebuilding, United Kingdom) shares have much better financial characteristics than comparable stocks. Shares of Barratt Developments are low in value (priced high) with a consolidated Value Rank of 47 (worse than 53% of alternatives). But they show above-average growth (Growth Rank of 74) and are safely financed (Safety Rank of 92, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 88, is a strong buy recommendation based on Barratt Developments's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Barratt Developments exhibits low value (Obermatt Value Rank of 47), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 74). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 92) 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). ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.