Fact based stock research
Bezeq The Israel Telecommunication (TASE:BEZQ)

IL0002300114

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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.

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Bezeq The Israel Telecommunication stock research in summary

bezeq.co.il

ANALYSIS: With an Obermatt Combined Rank of 6 (worse than 94% compared with investment alternatives), Bezeq The Israel Telecommunication (Integrated Telecommunication, Israel) shares have lower financial characteristics compared with similar stocks. Shares of Bezeq The Israel Telecommunication are low in value (priced high) with a consolidated Value Rank of 25 (worse than 75% of alternatives), show below-average growth (Growth Rank of 5), and are riskily financed (Safety Rank of 47), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 6, is a sell recommendation based on Bezeq The Israel Telecommunication's financial characteristics. As the company Bezeq The Israel Telecommunication's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 25), low growth (Obermatt Growth Rank of 5), and risky financing practices (Obermatt Safety Rank of 47), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	25
Growth Rank	5
Safety Rank	47
Combined Rank	6

Country	Israel
Industry	Integrated Telecommunication
Index
Size class	Large

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Bezeq The Israel Telecommunication

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	26	15	10	25
GROWTH
GROWTH	43	95	47	5
SAFETY
SAFETY	33	34	47	47
SENTIMENT
SENTIMENT	n/a	88	92	^new
360° VIEW
360° VIEW	n/a	77	49	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Bezeq The Israel Telecommunication is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	26	15	10	25
GROWTH
GROWTH	43	95	47	5
SAFETY
SAFETY	33	34	47	47
COMBINED
COMBINED	8	51	18	6

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Bezeq The Israel Telecommunication the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 25 (worse than 75% compared with alternatives), Bezeq The Israel Telecommunication shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Bezeq The Israel Telecommunication. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 67% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 23 which means that the stock price compared with what market professionals expect for future profits is higher than 77% of comparable companies, indicating a low value concerning Bezeq The Israel Telecommunication's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 40 which means that the stock price compared with what market professionals expect for future profit levels is higher than 60% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 7 is also low. Compared with invested capital, the stock price is higher than for 93% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 25, is a hold recommendation based on Bezeq The Israel Telecommunication's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Bezeq The Israel Telecommunication? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose Bezeq The Israel Telecommunication only if they reasonably expect the low current profit levels to be transitory. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	57	19	16	23
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	67	45	38	40
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	2	3	3	7
DIVIDEND YIELD
DIVIDEND YIELD	1	36	45	67
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	26	15	10	25

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Bezeq The Israel Telecommunication; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 5 (better than 5% compared with alternatives), Bezeq The Israel Telecommunication shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with all four metrics below average for Bezeq The Israel Telecommunication. Sales Growth has a rank of 12, which means that currently professionals expect the company to grow less than 88% of its competitors. The same is valid for Profit Growth, with a rank of 45, and Capital Growth with 22. In addition, Stock Returns have a below market rank of 29, which means that the stock returns have recently been below 71% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 5, is a sell recommendation for growth and momentum investors. These are all bad growth momentum indicators. These are negative signals for investors interested in growth companies. Value is likely good for this company, as investors may have left this stock in the cold. If that is the case, investors should look at the company's outlook, especially Sentiment performance, because it may be a turnaround situation that could entail above-average stock returns in the future. But it remains a risky bet, as no growth signals are in the green zone yet. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is low here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	16	22	12	12
PROFIT GROWTH
PROFIT GROWTH	n/a	74	77	45
CAPITAL GROWTH
CAPITAL GROWTH	n/a	73	73	22
STOCK RETURNS
STOCK RETURNS	91	97	25	29
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	43	95	47	5

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Bezeq The Israel Telecommunication.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 47 (better than 47% compared with alternatives), the company Bezeq The Israel Telecommunication has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Bezeq The Israel Telecommunication 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 two out of three indicators above-average for Bezeq The Israel Telecommunication. 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 10, which means the company has an above-average debt-to-equity ratio. It has more debt than 90% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 47 (worse than 53% compared with alternatives), Bezeq The Israel Telecommunication has a financing structure that is riskier 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 Bezeq The Israel Telecommunication 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. In the long-term, investors may have a debt challenge with Bezeq The Israel Telecommunication and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	17	6	8	10
REFINANCING
REFINANCING	51	59	65	57
LIQUIDITY
LIQUIDITY	45	51	52	59
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	33	34	47	47

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Bezeq The Israel Telecommunication and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	93	87	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	5	74	^new
MARKET PULSE
MARKET PULSE	n/a	96	87	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	88	92	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Bezeq The Israel Telecommunication.
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