May 11, 2023
Top 10 Stock Computershare 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: Computershare – Top 10 Stock in Australian Securities Exchange Index ASX 100
Computershare is listed as a top 10 stock on May 11, 2023 in the market index ASX 100 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, providing mixed investment signals. Based on the Obermatt 360° Rank of 27 (27% performer), Obermatt assesses an overall hold recommendation for Computershare on May 11, 2023.
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° Assessment Computershare Hold
| 360 METRICS | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 73 |
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| GROWTH | ||||||||
| GROWTH | 37 |
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| SAFETY | ||||||||
| SAFETY | 20 |
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| SENTIMENT | ||||||||
| SENTIMENT | 32 |
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| 360° VIEW | ||||||||
| 360° VIEW | 27 |
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ANALYSIS: With an Obermatt 360° Rank of 27 (better than 27% compared with alternatives), overall professional sentiment and engagement for the stock Computershare are below the industry average. The 360° Rank is based on consolidating four consolidated indicators, with three out of four indicators below average for Computershare. Only the consolidated Value Rank has an attractive rank of 73, which means that the share price of Computershare is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 73% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 37, 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 20, meaning the company has a riskier financing structure than 80% 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 68% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 32. ...read more
RECOMMENDATION: With a 360° Rank of 27, Computershare is worse than 73% 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 73. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 37), a riskier financing structure (Safety Rank of 20), and negative market sentiment in the professional investor community (Sentiment Rank of 32). 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 Computershare 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 Computershare. Only invest if you have solid reasons to believe that the sluggish 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 Computershare only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 32 (better than 32% compared with alternatives), overall professional sentiment and engagement for the stock Computershare 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 Computershare. Analyst Opinions are at a rank of 81 (better than 81% 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 72 which means that currently, professional investors hold more stock in this company than in 72% of alternative investment opportunities. But Analyst Opinions Change has a rank of 22, 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 Computershare. Furthermore, Market Pulse has a rank of 24, 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 76% of competitors). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 32 (less encouraging than 68% compared with investment alternatives), Computershare 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: Computershare Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 73 (better than 73% compared with alternatives), Computershare shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Computershare. Price-to-Sales (P/S) has a value of 51, which means that the stock price compared with what market professionals expect for future sales is lower than 51% of comparable companies, indicating a good value concerning Computershare's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than 88% of alternatives. Finally, it is true for expected dividend yields with an Obermatt Dividend Yield rank of 92 (dividends are expected to be higher than 92% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 60% of all competitors have an even higher price compared with book capital which puts the Obermatt Price-to-Capital Rank for Computershare to 40. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 73, is a BUY recommendation based on Computershare'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 three good value ranks for Sales, Profits, and Dividends are reliable indicators for the stock price value. ...read more
Growth Strategy: Computershare Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 37 (better than 37% compared with alternatives), Computershare 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 metrics below average for Computershare. While Profit Growth has a good rank of 98, as professionals currently expect the company to grow its profits more than 98% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 33, which means that currently professionals expect the company to grow less than 67% of its competitors, while Capital Growth has a rank of 1 and Stock Returns have been below market median, with a rank of 39 (61% of alternative investments were better). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 37, is a HOLD recommendation for growth and momentum investors. While revenue growth and capital growth are good growth momentum indicators, profit is less reliable, because profits may increase due to cost-cutting measures which typically indicate negative growth momentum. "You can save a dollar only once" is the saying about such situations. Growth Investors should look at company priorities closely if they are interested in growth, because the increase in profits is not usually an indicator of growth, and stock prices have been below market, too. ...read more
Safety Strategy: Computershare Debt Financing Safety risky
| SAFETY METRICS | May 11, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 7 |
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| REFINANCING | ||||||||
| REFINANCING | 58 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 33 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 20 |
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ANALYSIS: With an Obermatt Safety Rank of 20 (better than 20% compared with alternatives), the company Computershare 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 Computershare 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 Computershare and the other two below average. Refinancing is at 58, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 58% of its competitors. But Leverage is high with a rank of 7, meaning the company has an above-average debt-to-equity ratio. It has more debt than 93% of its competitors. Liquidity is also on the riskier side with a rank of 33, meaning the company generates less profit to service its debt than 67% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 20 (worse than 80% compared with alternatives), Computershare 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 Computershare 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 a financial decision. ...read more
Combined financial peformance: Computershare Below-Average Financial Performance
| COMBINED PERFORMANCE | May 11, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 73 |
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| GROWTH | ||||||||
| GROWTH | 37 |
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| SAFETY | ||||||||
| SAFETY | 33 |
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| COMBINED | ||||||||
| COMBINED | 41 |
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ANALYSIS: With an Obermatt Combined Rank of 41 (worse than 59% compared with investment alternatives), Computershare (Data Processing & Outsourcing, Australia) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Computershare are a good value (attractively priced) with a consolidated Obermatt Value Rank of 73 (better than 73% of alternatives) but show below-average growth (Growth Rank of 37), and are riskily financed (Safety Rank of 20), which means above-average debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 41, is a hold recommendation based on Computershare's financial characteristics. As the company Computershare's key financial metrics exhibit good value (Obermatt Value Rank of 73) but low growth (Obermatt Growth Rank of 37) and risky financing practices (Obermatt Safety Rank of 20), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 73% 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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