July 25, 2024
Top 10 Stock Truist Financial Sell 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: Truist Financial – Top 10 Stock in Dow Jones U.S. Regional Banks Index
Truist Financial is listed as a top 10 stock on July 25, 2024 in the market index D.J. US Banks 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 below average and thus a signal for caution. Based on the Obermatt 360° View of 22 (22% performer), Obermatt issues an overall sell recommendation for Truist Financial on July 25, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Regional Banks |
| Index | Dividends USA, D.J. US Banks, S&P 500 |
| 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 Truist Financial Sell
| 360 METRICS | July 25, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 72 |
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| GROWTH | ||||||||
| GROWTH | 93 |
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| SAFETY | ||||||||
| SAFETY | 3 |
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| SENTIMENT | ||||||||
| SENTIMENT | 43 |
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| 360° VIEW | ||||||||
| 360° VIEW | 22 |
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ANALYSIS: With an Obermatt 360° View of 22 (better than 22% compared with alternatives), overall professional sentiment and financial characteristics for the stock Truist Financial are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Truist Financial. The consolidated Value Rank has an attractive rank of 72, which means that the share price of Truist Financial 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 72% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 93, 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. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 43. Professional investors are more confident in 57% other stocks. Worryingly, the company has risky financing, with a Safety rank of 3. This means 97% of comparable companies have a safer financing structure than Truist Financial. ...read more
RECOMMENDATION: With a consolidated 360° View of 22, Truist Financial is worse than 78% of all alternative stock investment opportunities based on the Obermatt Method. This means that Truist Financial shares are on the riskier side for investors. Even though half of the consolidated Obermatt Ranks are above-average, namely the Value Rank at 72 and the Growth Rank above-average at 93, the picture is still mixed. The professional investor community is skeptical, with the Sentiment Rank below-average at 43. In addition, the company financing structure is on the riskier side (Safety Rank of 3). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. One may be tempted by above-average growth, but that could also change quickly, as past performance is not a good indicator of future performance. Since the financing structure is on the risky side, investors should 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 Truist Financial only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 43 (better than 43% compared with alternatives), overall professional sentiment and engagement for the stock Truist Financial 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 Truist Financial. Analyst Opinions are at a rank of 54 (better than 54% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive and has a rank of 92 which means that currently, stock research experts are getting even more optimistic about investments in Truist Financial. But Market Pulse has a low rank of 34, 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 66% of competitors). This is an essential sign of caution, as it could be the forebearer of bad news. Professional Investors are also somewhat absent with a rank of 8, which means that, currently, professional investors hold less stock in this company than in 92% of alternative investment opportunities. Pros tend to invest in other companies. This is expected if the company is of a smaller size (medium or smaller). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 43 (less encouraging than 57% compared with investment alternatives), Truist Financial has a reputation among professional investors that is below that of its competitors. While the general news feeds in the professional market are negative, the analyst recommendations are optimistic about the company, and even increase their ratings despite the negative news. This is an ambiguous situation with positive and negative signals from the professional side. Investors should be on the lookout for negative news but not worry too much about it as long as the overall news is still positive. ...read more
Value Strategy: Truist Financial Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 72 (better than 72% compared with alternatives), Truist Financial shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, where three out of four indicators are above average for Truist Financial. Price-to-Sales (P/S) is 52 which means that the stock price compared with what market professionals expect for future sales is lower than for 52% of comparable companies, indicating a good value for Truist Financial's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 67. Finally, compared with other companies in the same industry, dividend yields of Truist Financial are expected to be higher than for 86% of all competitors (a Dividend Yield rank of 86). The only low rank is for expected profits with a Price-to-Profit Rank of 38, indicating that the market expects the company's profit to be low despite a high dividend. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 72, is a buy recommendation based on Truist Financial's stock price compared with the company's operational size and dividend yields. The low Profit Rank could result from a one-off charge, for instance, for an accident, a legal settlement, or a restructuring project. If the company keeps its dividends high, the low expected profit may be transitory. If that is the case, the three good value ranks for Sales, Capital, and Dividends are reliable indicators for good stock price value, a low stock price. ...read more
Growth Strategy: Truist Financial Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 93 (better than 93% compared with alternatives) for 2024, Truist Financial shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Truist Financial. Sales Growth has a rank of 82 which means that currently, professionals expect the company to grow more than 82% of its competitors. Capital Growth is also above 46% of competitors with a rank of 95, and Stock Returns with the rank of 73 is also an outperformance. Only Profit Growth is low with a rank of 46 which means that currently, professionals expect the company to grow its profits less than 54% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 93, is a buy recommendation for growth and momentum investors. All three operating growth indicators, namely revenue, profit, and capital growth, are showing improvements. This is a good indication of a company with a positive future. That might, at the same time, be the simple reason why profit growth is low. A growing company needs money and thus can't yet show high profit growth. Look out for signs in corporate communication about extra growth efforts costing time and money. If that is the case, Truist Financial is a good growth stock. ...read more
Safety Strategy: Truist Financial Debt Financing Safety risky
| SAFETY METRICS | July 25, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 10 |
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| REFINANCING | ||||||||
| REFINANCING | 27 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 43 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 3 |
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ANALYSIS: With an Obermatt Safety Rank of 3 (better than 3% compared with alternatives), the company Truist Financial has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Truist Financial 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 all three metrics below average for Truist Financial. Liquidity is at 43, meaning that the company generates less profit to service its debt than 57% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 10, meaning the company has an above-average debt-to-equity ratio. It has more debt than 90% of its competitors. Finally, Refinancing is at a rank of 27 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 73% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 3 (worse than 97% compared with alternatives), Truist Financial has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing.
Combined financial peformance: Truist Financial Below-Average Financial Performance
| COMBINED PERFORMANCE | July 25, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 72 |
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| GROWTH | ||||||||
| GROWTH | 93 |
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| SAFETY | ||||||||
| SAFETY | 43 |
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| COMBINED | ||||||||
| COMBINED | 43 |
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ANALYSIS: With an Obermatt Combined Rank of 43 (worse than 57% compared with investment alternatives), Truist Financial (Regional Banks, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Truist Financial are a good value (attractively priced) with a consolidated Value Rank of 72 (better than 72% of alternatives), show above-average growth (Growth Rank of 93) but are riskily financed (Safety Rank of 3), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 43, is a hold recommendation based on Truist Financial's financial characteristics. As the company Truist Financial's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 72) and above-average growth (Obermatt Growth Rank of 93), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 3) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. 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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