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Confluent (NasdaqGS:CFLT)

US20717M1036

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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.

(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.

Confluent stock research in summary

confluent.io

ANALYSIS: With an Obermatt Combined Rank of 38 (worse than 62% compared with investment alternatives), Confluent (Application Software, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Confluent are low in value (priced high) with a consolidated Value Rank of 14 (worse than 86% of alternatives), and are riskily financed (Safety Rank of 30, which means above-average debt burdens) but show above-average growth (Growth Rank of 90). ...read more

RECOMMENDATION: A Combined Rank of 38, is a hold recommendation based on Confluent's financial characteristics. As the company Confluent shows low value with an Obermatt Value Rank of 14 (86% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 90% of comparable companies (Obermatt Growth Rank is 90). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 30 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Confluent, even a low-value company (in terms of its key financial indicators) can be a good investment. 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	14
Growth Rank	90
Safety Rank	30
Combined Rank	38

Country	USA
Industry	Application Software
Index	NASDAQ
Size class	Medium

19-Dec-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: Confluent

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	n/a	3	19	14
GROWTH
GROWTH	n/a	100	69	90
SAFETY
SAFETY	n/a	31	42	30
SENTIMENT
SENTIMENT	n/a	29	37	^new
360° VIEW
360° VIEW	n/a	35	26	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Confluent is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	n/a	3	19	14
GROWTH
GROWTH	n/a	100	69	90
SAFETY
SAFETY	n/a	31	42	30
COMBINED
COMBINED	n/a	6	17	38

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Confluent the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 14 (worse than 86% compared with alternatives), Confluent shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Confluent. Price-to-Sales is 27 which means that the stock price compared with what market professionals expect for future profits is higher than 73% of comparable companies, indicating a low value concerning Confluent's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 27, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Confluent. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 10 and Dividend Yield, which is lower than 99% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 14, is a sell recommendation based on Confluent's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Confluent? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Confluent? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Confluent may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. 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)	n/a	1	37	27
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	n/a	6	3	10
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	n/a	1	37	27
DIVIDEND YIELD
DIVIDEND YIELD	n/a	1	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	n/a	3	19	14

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Confluent; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 90 (better than 90% compared with alternatives) for 2024, Confluent 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 Confluent. Sales Growth has a value of 76, which means that, currently, professionals expect the company to grow more than 76% of its competitors. The same is valid for Profit Growth with a value of 100 and for Capital Growth with 71. In addition, Stock Returns had an above-average rank value of 74, which means they have been higher than 74% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 90, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Confluent 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. 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. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	n/a	93	91	76
PROFIT GROWTH
PROFIT GROWTH	n/a	88	75	100
CAPITAL GROWTH
CAPITAL GROWTH	n/a	55	52	71
STOCK RETURNS
STOCK RETURNS	n/a	97	21	74
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	n/a	100	69	90

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Confluent.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 30 (better than 30% compared with alternatives), the company Confluent 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 Confluent 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 Confluent and the other two below average. Refinancing is at 84, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 84% of its competitors. But Leverage is high with a rank of 19, meaning the company has an above-average debt-to-equity ratio. It has more debt than 81% of its competitors. Liquidity is also on the riskier side with a rank of 4, meaning the company generates less profit to service its debt than 96% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 30 (worse than 70% compared with alternatives), Confluent has a financing structure that is 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 Confluent 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. In the long-term, investors may have a debt challenge with Confluent 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	n/a	100	24	19
REFINANCING
REFINANCING	n/a	55	97	84
LIQUIDITY
LIQUIDITY	n/a	7	4	4
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	n/a	31	42	30

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Confluent 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	20	41	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	43	8	^new
MARKET PULSE
MARKET PULSE	n/a	70	78	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	29	37	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Confluent.
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