October 17, 2024
Top 10 Stock Collins Foods 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: Collins Foods – Top 10 Stock in Australian Securities Exchange Index ASX 200
Collins Foods is listed as a top 10 stock on October 17, 2024 in the market index ASX 200 because of its high performance in at least one of the Obermatt investment strategies. Only the Obermatt Value Rank exhibits above-average performance, which means that the stock is seen as critical by the professional community and other financial facts are below average, conveying mixed investment signals. Based on the Obermatt 360° View of 41 (41% performer), Obermatt assesses an overall hold recommendation for Collins Foods on October 17, 2024.
Snapshot: Obermatt Ranks
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 Collins Foods Hold
| 360 METRICS | October 17, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 84 |
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| GROWTH | ||||||||
| GROWTH | 33 |
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| SAFETY | ||||||||
| SAFETY | 16 |
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| SENTIMENT | ||||||||
| SENTIMENT | 48 |
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| 360° VIEW | ||||||||
| 360° VIEW | 41 |
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ANALYSIS: With an Obermatt 360° View of 41 (better than 41% compared with alternatives), overall professional sentiment and financial characteristics for the stock Collins Foods are below the industry average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Collins Foods. Only the consolidated Value Rank has an attractive rank of 84, which means that the share price of Collins Foods is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 84% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 33, which means 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. The consolidated Safety Rank has a riskier rank of 16, meaning the company has a riskier financing structure than 84% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, professionals are more pessimistic about the stock than for 52% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 48. ...read more
RECOMMENDATION: With a consolidated 360° View of 41, Collins Foods is worse than 59% of all alternative stock investment opportunities based on the Obermatt Method. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 84. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 33), a riskier financing structure than the competition (Safety Rank of 16), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 48) is negative. This combination is sensitive to a crisis, because high debt levels (low safety) require growth to finance the debt burden. It’s no wonder that the investor community indicators are skeptical (low sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. We recommend evaluating whether the future of Collins Foods is as challenging as the low price of the stock suggests. Since the professional community is pessimistic, you might need to worry about the future of Collins Foods. Only invest if you have solid reasons to believe that the low growth is temporary and the current market sentiment is an overreaction, possibly due to reputational issues in the past. ...read more
Sentiment Strategy: Professional Market Sentiment for Collins Foods only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 48 (better than 48% compared with alternatives), overall professional sentiment and engagement for the stock Collins Foods 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 Collins Foods. Analyst Opinions are at a rank of 40 (worse than 60% 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 Collins Foods. More encouragingly, the Professional Investors rank is 57, which means that professional investors hold more stock in this company than in 57% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 36, 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 64% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 48 (less encouraging than 52% compared with investment alternatives), Collins Foods has a reputation among professional investors that is below that of its competitors. The sentiment signals are mixed for Collins Foods. 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: Collins Foods Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 84 (better than 84% compared with alternatives) for 2024, Collins Foods shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Collins Foods. 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 Collins Foods's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 71% 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 68. Compared with other companies in the same industry, dividend yields of Collins Foods are expected to be higher than for 67% of all competitors (a Dividend Yield rank of 67). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 84, is a buy recommendation based on Collins Foods'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 Collins Foods based on its detailed value metrics.
Growth Strategy: Collins Foods Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 33 (better than 33% compared with alternatives), Collins Foods 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 three out of four indicators below average for Collins Foods. Only Capital Growth has a good rank of 81, which means that currently professionals expect the company to grow its invested capital more than 20% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 43 which means that currently professionals expect the company to grow less than 57% of its competitors. Profit Growth with a rank of 20 and Stock Returns with a rank of 33 are also low (below 67% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 33, is a hold recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Collins Foods is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. ...read more
Safety Strategy: Collins Foods Debt Financing Safety risky
| SAFETY METRICS | October 17, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 19 |
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| REFINANCING | ||||||||
| REFINANCING | 19 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 22 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 16 |
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ANALYSIS: With an Obermatt Safety Rank of 16 (better than 16% compared with alternatives), the company Collins Foods 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 Collins Foods 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 Collins Foods. Liquidity is at 22, meaning that the company generates less profit to service its debt than 78% 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 19, meaning the company has an above-average debt-to-equity ratio. It has more debt than 81% of its competitors. Finally, Refinancing is at a rank of 19 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 81% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 16 (worse than 84% compared with alternatives), Collins Foods 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: Collins Foods Below-Average Financial Performance
| COMBINED PERFORMANCE | October 17, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 84 |
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| GROWTH | ||||||||
| GROWTH | 33 |
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| SAFETY | ||||||||
| SAFETY | 22 |
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| COMBINED | ||||||||
| COMBINED | 46 |
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ANALYSIS: With an Obermatt Combined Rank of 46 (worse than 54% compared with investment alternatives), Collins Foods (Restaurants, Australia) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Collins Foods are a good value (attractively priced) with a consolidated Value Rank of 84 (better than 84% of alternatives) but show below-average growth (Growth Rank of 33), and are riskily financed (Safety Rank of 16), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 46, is a hold recommendation based on Collins Foods's financial characteristics. As the company Collins Foods's key financial metrics exhibit good value (Obermatt Value Rank of 84) but low growth (Obermatt Growth Rank of 33) and risky financing practices (Obermatt Safety Rank of 16), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 84% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. ...read more
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