November 21, 2024
Top 10 Stock BASF 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: BASF – Top 10 Stock in Deutscher Aktienindex DAX 40
BASF is listed as a top 10 stock on November 21, 2024 in the market index DAX 40 because of its high performance in at least one of the Obermatt investment strategies. As all consolidated Obermatt Ranks exhibit excellent performance, including positive market sentiment in the professional investor community, it is a solid stock investment where the risk of paying too much for the shares is limited. Based on the Obermatt 360° View of 76 (top 76% performer), Obermatt assesses an overall strong buy recommendation for BASF on November 21, 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 Strong Buy
| 360 METRICS | November 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 79 |
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| GROWTH | ||||||||
| GROWTH | 50 |
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| SAFETY | ||||||||
| SAFETY | 63 |
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| SENTIMENT | ||||||||
| SENTIMENT | 60 |
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| 360° VIEW | ||||||||
| 360° VIEW | 76 |
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ANALYSIS: With an Obermatt 360° View of 76 (better than 76% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock BASF are very positive. The 360° View is based on consolidating four consolidated indicators, with all four indicators 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 consolidated Growth Rank has a good rank of 50, 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. The company is also safely financed with a Safety rank of 63. Finally, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 60. ...read more
RECOMMENDATION: With a consolidated 360° View of 76, BASF is better positioned than 76% of all alternative stock investment opportunities based on the Obermatt Method. As all consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 79), above-average growth (Growth Rank of 50), safe financing practices (Safety Rank of 63), and a positive market sentiment in the professional investor community (Sentiment Rank of 60), it is a solid stock investment where the risk of paying too much for the shares is limited and disappointments are less likely to occur, unless information not publicly available. High-Value Ranks sometimes indicate that the company's future is challenging. If they are safely financed and have above average growth, and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of BASF is as difficult as the stock’s low price, despite what good growth and safe financing practice suggest. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible, which may indicate good timing right now. ...read more
Sentiment Strategy: Professional Market Sentiment for BASF positive
ANALYSIS: With an Obermatt Sentiment Rank of 60 (better than 60% compared with alternatives), overall professional sentiment and engagement for the stock BASF is above average. The Sentiment Rank is based on consolidating four sentiment indicators where all but one are above average for BASF. Analyst Opinions are at a rank of 52 (better than 52% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. The Professional Investors rank is also good at 56, which means that currently, professional investors hold more stock in this company than in 56% of alternative investment opportunities. Pros tend to favor investing in this company. In addition, Market Pulse has a rank of 50 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 50% of competitors). But Analyst Opinions Change has a below-average rank of 49, which means that stock research experts are currently changing their opinions for the worse when it comes to recommending this stock. In other words, they are getting more critical of investments in BASF. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 60 (more positive than 60% compared with investment alternatives), BASF has a reputation among professional investors that is above-average compared with that of its competitors. This is an early sign of caution, even if the stock has significantly appreciated. If analysts change their opinions, the stock may become too expensive. If the price is on the way down, the trend may continue. This may be a stock with a good reputation and history, but it may have reached its breaking point by now. Investors should look at the Value Ranks as well. If they indicate trouble, it might just materialize in the future. ...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 69 which means that the stock price compared with what market professionals expect for future sales is lower than for 69% 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 55. Compared with other companies in the same industry, dividend yields of BASF are expected to be higher than for 90% of all competitors (a Dividend Yield rank of 90). ...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 good
| GROWTH METRICS | November 21, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 40 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 61 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 15 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 67 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 50 |
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ANALYSIS: With an Obermatt Growth Rank of 50 (better than 50% compared with alternatives), BASF 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 BASF. Profit Growth has a rank of 61, which means that currently professionals expect the company to grow its profits more than 61% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 67 (above 67% of alternative investments). But Sales Growth has a below the median rank of 40, which means that, currently, professionals expect the company to grow less than 60% of its competitors, and Capital Growth also has a lower rank of 15. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 50, is a buy 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 | November 21, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 46 |
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| REFINANCING | ||||||||
| REFINANCING | 60 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 58 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 63 |
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ANALYSIS: With an Obermatt Safety Rank of 63 (better than 63% 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 60, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 60% of its competitors. Liquidity is also good at 58, meaning the company generates more profit to service its debt than 58% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 46, which means the company has an above-average debt-to-equity ratio. It has more debt than 54% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 63 (better than 63% 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 Top Financial Performance
| COMBINED PERFORMANCE | November 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 79 |
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| GROWTH | ||||||||
| GROWTH | 50 |
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| SAFETY | ||||||||
| SAFETY | 58 |
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| COMBINED | ||||||||
| COMBINED | 78 |
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ANALYSIS: With an Obermatt Combined Rank of 78 (better than 78% compared with investment alternatives), BASF (Diversified Chemicals, Germany) shares have much better financial characteristics than comparable stocks. Shares of BASF are a good value (attractively priced) with a consolidated Value Rank of 79 (better than 79% of alternatives), show above-average growth (Growth Rank of 50), and are safely financed (Safety Rank of 63), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 78, is a strong buy recommendation based on BASF's financial characteristics. As the company BASF's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 79), above-average growth (Obermatt Growth Rank of 50), and indicate that the company is safely financed (Obermatt Safety Rank of 63), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of BASF. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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