November 14, 2024
Top 10 Stock Chemed 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: Chemed – Top 10 Stock in Dow Jones U.S. Health Care Providers Index
Chemed is listed as a top 10 stock on November 14, 2024 in the market index D.J. US Health Care because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company is safely financed, but all other facts speak against a stock purchase, especially the low market sentiment by professional investors. Based on the Obermatt 360° View of 32 (32% performer), Obermatt assesses an overall hold recommendation for Chemed on November 14, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Health Care Services |
| Index | D.J. US Health Care, S&P MIDCAP |
| Size class | 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 Chemed Hold
| 360 METRICS | November 14, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 25 |
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| GROWTH | ||||||||
| GROWTH | 39 |
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| SAFETY | ||||||||
| SAFETY | 91 |
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| SENTIMENT | ||||||||
| SENTIMENT | 29 |
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| 360° VIEW | ||||||||
| 360° VIEW | 32 |
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ANALYSIS: With an Obermatt 360° View of 32 (better than 32% compared with alternatives), overall professional sentiment and financial characteristics for the stock Chemed are below the industry average. The 360° View is based on consolidating four consolidated indicators, with three out of four metrics below average for Chemed. The only rank that is above average is the consolidated Safety Rank at 91, which means that the company has a financing structure that is safer than those of 91% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the Value, Growth and Sentiment Ranks are all below average. The consolidated Value Rank has a less desirable rank of 25, which means that the share price of Chemed is on the high side compared with typical size in indicators such as revenues, profits, and invested capital. The consolidated Growth Rank also has a low rank of 39, which implies that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. Finally, the consolidated Sentiment Rank is also low at a rank of 29, which means that professional investors are more pessimistic about the stock than for 71% of alternative investment opportunities. While Safety is strong, it’s not the most critical indicator, so we suggest proceeding with caution if you are considering this stock. ...read more
RECOMMENDATION: With a consolidated 360° View of 32, Chemed is worse than 68% of all alternative stock investment opportunities based on the Obermatt Method. As only the financing structure, namely the Safety Rank, is on the safer side and all other consolidated Obermatt Ranks are below-average, this is a riskier stock investment proposition. This is especially the case, since professional investor sentiment, the consolidated Obermatt Sentiment Rank, is also low at 29. The negative market view on Chemed may be the high stock price (low value) or the low level of growth. This is a problem. As the Safety Rank is the least significant of the four consolidated Obermatt Ranks, we cannot identify enough positive facts that are visible today to make a case for this stock investment. The company may have a strong future which would justify the high stock price, but this is not visible from investor behavior today. As market sentiment is critical, you should be careful with paying more than market-average for this stock, and conduct further research into the company's future growth potential. Prudent investors may only want to invest a smaller portion of their wealth in such situations. Young investors can carry more risk but should still thrive for sufficient diversification. ...read more
Sentiment Strategy: Professional Market Sentiment for Chemed only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 29 (better than 29% compared with alternatives), overall professional sentiment and engagement for the stock Chemed is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the indicators below and the other half above average for Chemed. Analyst Opinions are at a rank of 100 (better than 100% of alternative investments). Currently, stock research analysts tend to recommend a stock investment in the company. There are also many institutional investors invested in the stock, represented by a Professional Investors rank of 51 which means that currently, professional investors hold more stock in this company than in 51% of alternative investment opportunities. But Analyst Opinions Change has a rank of 1, which means that stock research experts are changing their opinions for the worse in recommending investing in the company. In other words, they are getting more critical of investments in Chemed. Furthermore, Market Pulse has a rank of 2, 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 98% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 29 (less encouraging than 71% compared with investment alternatives), Chemed has a reputation among professional investors that is below that of its competitors. Three below-market sentiment indicators are a 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 may be around the corner. ...read more
Value Strategy: Chemed Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 25 (worse than 75% compared with alternatives), Chemed 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 Chemed. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 71% 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 5 which means that the stock price compared with what market professionals expect for future profits is higher than 95% of comparable companies, indicating a low value concerning Chemed's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 28 which means that the stock price compared with what market professionals expect for future profit levels is higher than 72% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 12 is also low. Compared with invested capital, the stock price is higher than for 88% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 25, is a hold recommendation based on Chemed's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Chemed? 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 Chemed only if they reasonably expect the low current profit levels to be transitory. ...read more
Growth Strategy: Chemed Growth Momentum low
| GROWTH METRICS | November 14, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 53 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 57 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 39 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 31 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 39 |
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ANALYSIS: With an Obermatt Growth Rank of 39 (better than 39% compared with alternatives), Chemed 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 Chemed. Sales Growth has a rank of 53, which means that, currently, professionals expect the company to grow more than 53% of its competitors. Profit Growth with a rank of 57 is also above average. But Capital Growth has only a rank of 39, and Stock Returns with 31 are also below-average. Stock returns for Chemed have recently been below 69% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 39, is a hold recommendation for growth and momentum investors. Are investors forecasting troubles based on the lack of operating investment activity at the company? This could be one explanation as to why stock returns are low. But stock returns can also be the result of correcting an error in the past, in this case, an overly optimistic outlook on the future, which is now more realistic. The Value Ranks may confirm such a picture. The more important growth indicators are revenues and profits, which are both above average for Chemed. This is a positive sign from the company's operational side and may give investors courage, despite the poor recent stock price performance. ...read more
Safety Strategy: Chemed Debt Financing Safety very solid
| SAFETY METRICS | November 14, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 88 |
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| REFINANCING | ||||||||
| REFINANCING | 29 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 98 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 91 |
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ANALYSIS: With an Obermatt Safety Rank of 91 (better than 91% compared with alternatives) for 2024, the company Chemed has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Chemed 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 Chemed. Leverage is at a rank of 88, meaning the company has a below-average debt-to-equity ratio. It has less debt than 88% of its competitors. Liquidity is also good at a rank of 98, meaning the company generates more profit to service its debt than 98% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 29, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 71% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 91 (better than 91% compared with alternatives), Chemed has a financing structure that is significantly safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Chemed. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. ...read more
Combined financial peformance: Chemed Above-Average Financial Performance
| COMBINED PERFORMANCE | November 14, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 25 |
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| GROWTH | ||||||||
| GROWTH | 39 |
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| SAFETY | ||||||||
| SAFETY | 98 |
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| COMBINED | ||||||||
| COMBINED | 52 |
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ANALYSIS: With an Obermatt Combined Rank of 52 (better than 52% compared with investment alternatives), Chemed (Health Care Services, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Chemed are low in value (priced high) with a consolidated Value Rank of 25 (worse than 75% of alternatives) and show below-average growth (Growth Rank of 39) but are safely financed (Safety Rank of 91), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 52, is a buy recommendation based on Chemed's financial characteristics. As the company Chemed's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 25) and low growth (Obermatt Growth Rank of 39), 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. In this case, good financing practices (Obermatt Safety Rank of 91) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. ...read more
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