July 13, 2023
Top 10 Stock Dassault Aviation Strong Buy 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: Dassault Aviation – Top 10 Stock in Société des Bourses Françaises Index SBF 120
Dassault Aviation is listed as a top 10 stock on July 13, 2023 in the market index SBF 120 because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. The company is safely financed and the professional investor sentiment is positive. Both are encouraging signals for a stock purchase decision, albeit at an above-average share price. Based on the Obermatt 360° View of 75 (top 75% performer), Obermatt assesses an overall strong buy recommendation for Dassault Aviation on July 13, 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° View Dassault Aviation Strong Buy
| 360 METRICS | July 13, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 23 |
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| GROWTH | ||||||||
| GROWTH | 46 |
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| SAFETY | ||||||||
| SAFETY | 94 |
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| SENTIMENT | ||||||||
| SENTIMENT | 70 |
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| 360° VIEW | ||||||||
| 360° VIEW | 75 |
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ANALYSIS: With an Obermatt 360° View of 75 (better than 75% compared with alternatives) for 2023, overall professional sentiment and financial characteristics for the stock Dassault Aviation are very positive. The 360° View is based on consolidating four consolidated indicators, with half below and half above average for Dassault Aviation. The consolidated Sentiment Rank has a good rank of 70, which means that professional investors are more optimistic about the stock than for 70% of alternative investment opportunities. It also rates well regarding its financing structure, with the consolidated Safety Rank at 94 or better than 94% of its peers when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the stock is expensive and expects low growth. The consolidated Value Rank is only 23, meaning that the share price of Dassault Aviation is on the high side, compared with indicators such as revenues, profits, and invested capital. The company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth,and stock returns, with its Growth Rank at 46. ...read more
RECOMMENDATION: With a consolidated 360° View of 75, Dassault Aviation is better positioned than 75% of all alternative stock investment opportunities based on the Obermatt Method. As only half of the consolidated Obermatt Ranks exhibit excellent performance, namely the positive professional market sentiment (Sentiment Rank of 70) and safe financing practices (Safety Rank of 94), the case for investing in this stock needs further thought. The Value and the Safety Ranks are below average. The Safety Rank is the least critical of the four consolidated ranks, because it only reflects financing practices. So the question is: How to assess below-average value against above-average sentiment? This may be a case where growth is in the future, not yet reflected in current performance. Companies that might fall into this category are those with intellectual property, such as technology and pharmaceutical companies. In early phases, they are expensive relative to their size and have a lot of capital on their books, as is the case here. Investors expect a better future and are willing to pay a higher price than is warranted by the current company size. These higher prices drive stock price value down in the short term. In this case, future growth may be the strongest driver of the investment case, reflected by institutional investors' opinions. With a weak Value Rank, the question is how much to sacrifice value at the cost of positive sentiment. Sometimes market sentiment is just hype, but sometimes it is right. You pay more than market-average for this stock, but it may be worth it, if the future of Dassault Aviatioṇ is bright. 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 Dassault Aviation positive
ANALYSIS: With an Obermatt Sentiment Rank of 70 (better than 70% compared with alternatives), overall professional sentiment and engagement for the stock Dassault Aviation is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the indicators below and above average for Dassault Aviation. Analyst Opinions are at a rank of 44 (worse than 56% 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 80 which means that stock research experts are changing their opinions for the better. In other words, they are getting more optimistic of stock investments in Dassault Aviation. Market Pulse is also positive with a rank of 75, which means that the current professional news and professional social networks are positive in their discussions about this company (more positive news than for 75% of competitors). Only professional investors tend to be absent with a Professional Investors rank of 47, which means that professional investors hold less stock in this company than in 53% of alternative investment opportunities. Pros tend to invest in other companies. But that could also be due to the size of the company. Professional investors tend to invest in XL and XXL companies. If the company is smaller than that, that fact alone may explain why there are fewer pros present. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 70 (more positive than 70% compared with investment alternatives), Dassault Aviation has a reputation among professional investors that is above-average compared with that of its competitors. Since analysts are getting more optimistic and the professional communication channels are positive, it may be an indication of a company that has the difficult times behind it or the stocks’ value is improving. For medium to smaller companies, the positive sentiment indicators outshine the negative. ...read more
Value Strategy: Dassault Aviation Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 23 (worse than 77% compared with alternatives), Dassault Aviation 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 Dassault Aviation. Price-to-Sales is 3 which means that the stock price compared with what market professionals expect for future profits is higher than 97% of comparable companies, indicating a low value concerning Dassault Aviation's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 42, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Dassault Aviation. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 40 and Dividend Yield, which is lower than 56% 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 23, is a sell recommendation based on Dassault Aviation's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Dassault Aviation? 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 Dassault Aviation? 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. Dassault Aviation 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. ...read more
Growth Strategy: Dassault Aviation Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 46 (better than 46% compared with alternatives), Dassault Aviation 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 all but one indicator above average for Dassault Aviation. Sales Growth has a rank of 72 which means that currently, professionals expect the company to grow more than 72% of its competitors. Capital Growth is also above 22% of competitors with a rank of 53, and Stock Returns with the rank of 57 is also an outperformance. Only Profit Growth is low with a rank of 22 which means that currently, professionals expect the company to grow its profits less than 78% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 46, is a hold recommendation for growth and momentum investors. All three operating growth indicators, namely revenue, profit, and capital growth, are showing improvements. This is a good indication of a company with a positive future. That might, at the same time, be the simple reason why profit growth is low. A growing company needs money and thus can't yet show high profit growth. Look out for signs in corporate communication about extra growth efforts costing time and money. If that is the case, Dassault Aviation is a good growth stock. ...read more
Safety Strategy: Dassault Aviation Debt Financing Safety very solid
| SAFETY METRICS | July 13, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 97 |
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| REFINANCING | ||||||||
| REFINANCING | 46 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 94 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 94 |
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ANALYSIS: With an Obermatt Safety Rank of 94 (better than 94% compared with alternatives) for 2023, the company Dassault Aviation has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Dassault Aviation 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 Dassault Aviation. Leverage is at a rank of 97, meaning the company has a below-average debt-to-equity ratio. It has less debt than 97% of its competitors. Liquidity is also good at a rank of 94, meaning the company generates more profit to service its debt than 94% 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 46, 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 54% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 94 (better than 94% compared with alternatives), Dassault Aviation 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 Dassault Aviation. 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: Dassault Aviation Above-Average Financial Performance
| COMBINED PERFORMANCE | July 13, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 23 |
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| GROWTH | ||||||||
| GROWTH | 46 |
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| SAFETY | ||||||||
| SAFETY | 94 |
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| COMBINED | ||||||||
| COMBINED | 61 |
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ANALYSIS: With an Obermatt Combined Rank of 61 (better than 61% compared with investment alternatives), Dassault Aviation (Aerospace & Defense, France) shares have above-average financial characteristics compared with similar stocks. Shares of Dassault Aviation are low in value (priced high) with a consolidated Value Rank of 23 (worse than 77% of alternatives) and show below-average growth (Growth Rank of 46) but are safely financed (Safety Rank of 94), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 61, is a buy recommendation based on Dassault Aviation's financial characteristics. As the company Dassault Aviation's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 23) and low growth (Obermatt Growth Rank of 46), 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 94) 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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