March 28, 2024
Top 10 Stock Braskem Hold 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: Braskem – Top 10 Stock in Bolsa de Valores-Mercadorias | BOVESPA
Braskem is listed as a top 10 stock on March 28, 2024 in the market index BOVESPA 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 45 (45% performer), Obermatt assesses an overall hold recommendation for Braskem on March 28, 2024.
Snapshot: Obermatt Ranks
| Country | Brazil |
| Industry | Commodity Chemicals |
| Index | BOVESPA, Low Emissions, Independent Boards Growth Markets |
| 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 Braskem Hold
| 360 METRICS | March 28, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 51 |
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| GROWTH | ||||||||
| GROWTH | 95 |
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| SAFETY | ||||||||
| SAFETY | 18 |
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| SENTIMENT | ||||||||
| SENTIMENT | 26 |
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| 360° VIEW | ||||||||
| 360° VIEW | 45 |
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ANALYSIS: With an Obermatt 360° View of 45 (better than 45% compared with alternatives), overall professional sentiment and financial characteristics for the stock Braskem are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Braskem. The consolidated Value Rank has an attractive rank of 51, which means that the share price of Braskem 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 51% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 95, 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 26. Professional investors are more confident in 74% other stocks. Worryingly, the company has risky financing, with a Safety rank of 18. This means 82% of comparable companies have a safer financing structure than Braskem. ...read more
RECOMMENDATION: With a consolidated 360° View of 45, Braskem is worse than 55% of all alternative stock investment opportunities based on the Obermatt Method. Even though half of the consolidated Obermatt Ranks are above-average, namely the Value Rank at 51 and the Growth Rank above-average at 95, the picture is still mixed. The professional investor community is skeptical, with the Sentiment Rank below-average at 26. In addition, the company financing structure is on the riskier side (Safety Rank of 18). 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 Braskem only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 26 (better than 26% compared with alternatives), overall professional sentiment and engagement for the stock Braskem 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 Braskem. Analyst Opinions are at a rank of 46 (worse than 54% 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 50, 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 Braskem. More encouragingly, the Professional Investors rank is 53, which means that professional investors hold more stock in this company than in 53% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 3, 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 97% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 26 (less encouraging than 74% compared with investment alternatives), Braskem has a reputation among professional investors that is below that of its competitors. The sentiment signals are mixed for Braskem. 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: Braskem Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 51 (better than 51% compared with alternatives), Braskem shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half are above average for Braskem. Price-to-Sales (P/S) is 100, which means that the stock price compared with what market professionals expect for future sales is lower than for 100% of comparable companies, indicating a good value concerning Braskem's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 72% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 1 (dividends are expected to be higher than for 1% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 63% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Braskem to 37. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 51, is a buy recommendation based on Braskem's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner on assets than its competitors. For instance, the company could be leasing its production facilities, or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the low Dividend Yield is also explained as such companies tend to invest their income into market development. The other good value ranks for Sales and Profits are encouraging indicators for the stock price value. ...read more
Growth Strategy: Braskem Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 95 (better than 95% compared with alternatives) for 2024, Braskem 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 four indicators above average for Braskem. Sales Growth has a value of 51, which means that, currently, professionals expect the company to grow more than 51% of its competitors. The same is valid for Profit Growth with a value of 86 and for Capital Growth with 76. In addition, Stock Returns had an above-average rank value of 71, which means they have been higher than 71% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 95, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Braskem exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. ...read more
Safety Strategy: Braskem Debt Financing Safety risky
| SAFETY METRICS | March 28, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 1 |
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| REFINANCING | ||||||||
| REFINANCING | 98 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 6 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 18 |
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ANALYSIS: With an Obermatt Safety Rank of 18 (better than 18% compared with alternatives), the company Braskem 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 Braskem 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 just one indicator above average for Braskem and the other two below average. Refinancing is at 98, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 98% of its competitors. But Leverage is high with a rank of 1, meaning the company has an above-average debt-to-equity ratio. It has more debt than 99% of its competitors. Liquidity is also on the riskier side with a rank of 6, meaning the company generates less profit to service its debt than 94% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 18 (worse than 82% compared with alternatives), Braskem has a financing structure that is significantly riskier than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Braskem are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. ...read more
Combined financial peformance: Braskem Above-Average Financial Performance
| COMBINED PERFORMANCE | March 28, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 51 |
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| GROWTH | ||||||||
| GROWTH | 95 |
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| SAFETY | ||||||||
| SAFETY | 6 |
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| COMBINED | ||||||||
| COMBINED | 67 |
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ANALYSIS: With an Obermatt Combined Rank of 67 (better than 67% compared with investment alternatives), Braskem (Commodity Chemicals, Brazil) shares have above-average financial characteristics compared with similar stocks. Shares of Braskem are a good value (attractively priced) with a consolidated Value Rank of 51 (better than 51% of alternatives), show above-average growth (Growth Rank of 95) but are riskily financed (Safety Rank of 18), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 67, is a buy recommendation based on Braskem's financial characteristics. As the company Braskem's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 51) and above-average growth (Obermatt Growth Rank of 95), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 18) 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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