October 10, 2024
Top 10 Stock BASF 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: BASF – Top 10 Stock in EURO STOXX 50 Index
BASF is listed as a top 10 stock on October 10, 2024 in the market index EURO STOXX 50 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 66 (high 66% performer), Obermatt assesses an overall buy recommendation for BASF on October 10, 2024.
Snapshot: Obermatt Ranks
| Country | Germany |
| Industry | Diversified Chemicals |
| Index | CDAX, DAX 40, EURO STOXX 50, Low Emissions, Dividends Europe, Energy Efficient, Diversity Europe, Human Rights, Water Efficiency |
| Size class | XX-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 BASF Buy
| 360 METRICS | October 10, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 79 |
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| GROWTH | ||||||||
| GROWTH | 47 |
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| SAFETY | ||||||||
| SAFETY | 62 |
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| SENTIMENT | ||||||||
| SENTIMENT | 40 |
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| 360° VIEW | ||||||||
| 360° VIEW | 66 |
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ANALYSIS: With an Obermatt 360° View of 66 (better than 66% compared with alternatives), overall professional sentiment and financial characteristics for the stock BASF are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for BASF. The consolidated Value Rank has an attractive rank of 79, which means that the share price of BASF 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 79% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 62. 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 47, 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. 53 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 66, BASF is better positioned than 66% 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 79), and the financing structure is on the safer side (Safety Rank of 62). 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 47). 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 BASF only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 40 (better than 40% compared with alternatives), overall professional sentiment and engagement for the stock BASF is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the indicators below and half above average for BASF. Analyst Opinions are at a rank of 55 (better than 55% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. Market Pulse is also positive with a rank of 56, which means that the current professional news and professional social networks are positive when discussing this company (more positive news than for 56% of competitors). But Analyst Opinions Change is negative with a below 50 rank of 10, which means that stock research experts are changing their opinions for the worse in recommending the company. In other words, they are getting more critical of investments in BASF. There are also only so many institutional investors holding company stock with a Professional Investors rank of 45, which means that, currently, professional investors hold less stock in this company than in 55% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 40 (less encouraging than 60% compared with investment alternatives), BASF has a reputation among professional investors that is below that of its competitors. The signals are ambivalent. The positive news in the market contradicts the negative change in analyst recommendations. Since the overall analyst recommendations are still above average, the stock may be safer for investing, especially if it is not an extra-large company where Pros tend to be less present. In such a case, the Pro Investor rank is not a problem. ...read more
Value Strategy: BASF Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 79 (better than 79% compared with alternatives) for 2024, BASF shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for BASF. Price-to-Sales is 66 which means that the stock price compared with what market professionals expect for future sales is lower than for 66% of comparable companies, indicating a good value for BASF's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 61% 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 62. Compared with other companies in the same industry, dividend yields of BASF are expected to be higher than for 83% of all competitors (a Dividend Yield rank of 83). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 79, is a buy recommendation based on BASF'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 BASF based on its detailed value metrics.
Growth Strategy: BASF Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 47 (better than 47% compared with alternatives), BASF 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 BASF. Profit Growth has a rank of 60, which means that currently professionals expect the company to grow its profits more than 60% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 77 (above 77% of alternative investments). But Sales Growth has a below the median rank of 31, which means that, currently, professionals expect the company to grow less than 69% of its competitors, and Capital Growth also has a lower rank of 21. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 47, is a hold recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for BASF. ...read more
Safety Strategy: BASF Debt Financing Safety above-average
| SAFETY METRICS | October 10, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 48 |
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| REFINANCING | ||||||||
| REFINANCING | 57 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 59 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 62 |
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ANALYSIS: With an Obermatt Safety Rank of 62 (better than 62% compared with alternatives), the company BASF 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 BASF 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 BASF. Refinancing is at 57, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 57% of its competitors. Liquidity is also good at 59, meaning the company generates more profit to service its debt than 59% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 48, which means the company has an above-average debt-to-equity ratio. It has more debt than 52% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 62 (better than 62% compared with alternatives), BASF has a financing structure that is safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and BASF could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. ...read more
Combined financial peformance: BASF Above-Average Financial Performance
| COMBINED PERFORMANCE | October 10, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 79 |
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| GROWTH | ||||||||
| GROWTH | 47 |
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| SAFETY | ||||||||
| SAFETY | 59 |
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| COMBINED | ||||||||
| COMBINED | 73 |
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ANALYSIS: With an Obermatt Combined Rank of 73 (better than 73% compared with investment alternatives), BASF (Diversified Chemicals, Germany) shares have above-average financial characteristics compared with similar stocks. Shares of BASF are a good value (attractively priced) with a consolidated Value Rank of 79 (better than 79% of alternatives), are safely financed (Safety Rank of 62, which means low debt burdens), but show below-average growth (Growth Rank of 47). ...read more
RECOMMENDATION: A Combined Rank of 73, is a buy recommendation based on BASF's financial characteristics. As the company BASF's key financial metrics exhibit good value (Obermatt Value Rank of 79) but low growth (Obermatt Growth Rank of 47) while being safely financed (Obermatt Safety Rank of 62), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 79% 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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