May 2, 2024
Top 10 Stock DBS Group 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: DBS Group – Top 10 Stock in Straits Times Index STI
DBS Group is listed as a top 10 stock on May 02, 2024 in the market index STI because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company enjoys a positive professional investor sentiment, but all financial facts speak against a stock purchase. This is probably an investment into the future. Based on the Obermatt 360° View of 55 (high 55% performer), Obermatt assesses an overall buy recommendation for DBS Group on May 02, 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 DBS Group Buy
| 360 METRICS | May 2, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 48 |
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| GROWTH | ||||||||
| GROWTH | 45 |
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| SAFETY | ||||||||
| SAFETY | 32 |
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| SENTIMENT | ||||||||
| SENTIMENT | 98 |
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| 360° VIEW | ||||||||
| 360° VIEW | 55 |
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ANALYSIS: With an Obermatt 360° View of 55 (better than 55% compared with alternatives), overall professional sentiment and financial characteristics for the stock DBS Group are above average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for DBS Group. The consolidated Sentiment Rank has a good rank of 98, which means that professional investors are more optimistic about the stock than for 98% of alternative investment opportunities. But all other ranks are below average. The consolidated Value Rank has a rank of 48, which means that the share price of DBS Group is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. The consolidated Growth Rank also has a low rank of 45, meaning that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. This means that growth is lower than for 45% of competitors in the same industry. Finally, the consolidated Safety Rank has a riskier rank of 32 which means that the company has a riskier financing structure than 68% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. ...read more
RECOMMENDATION: With a consolidated 360° View of 55, DBS Group is better positioned than 55% of all alternative stock investment opportunities based on the Obermatt Method. As only the professional market sentiment (Sentiment Rank of 98) is above-average, and all other consolidated Obermatt Ranks are below peers, the stock investing proposition case is rather weak. The stock price is expensive for a company of this size in this industry, visible in the below-average Value Rank. Growth is below the competition based on the Growth Rank, and the company has more debt than other companies, according to the Safety Rank. So the question becomes: How important is the Sentiment Rank when all others are below average? When it comes to growth, the low rating might be justified if growth is expected in the future and not yet reflected in current performance. This is often the case for companies with intellectual property, such as technology and pharmaceutical companies. In the early phases, these companies are expensive compared with their size and may have a lot of debt on their books, as is the case here, as seen in the low Value and Safety Ranks. Future growth may be the strongest investment rationale in this case, which is only reflected by institutional investors' opinions. You pay more than the market average for this stock and invest in a rather debt-loaded enterprise, but it may be worth it if the future of DBS Group̣ is bright. A small investment might be justified, but proceed with caution. ...read more
Sentiment Strategy: Professional Market Sentiment for DBS Group very positive
ANALYSIS: With an Obermatt Sentiment Rank of 98 (better than 98% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock DBS Group is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all four indicators above average for DBS Group. Analyst Opinions are at a rank of 86 (better than 86% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive with a rank of 85, which means that stock research experts are changing their opinions for the better and recommending investing in the company. They are getting more optimistic about stock investments in DBS Group. The Professional Investors rank is 80, which means that currently, professional investors hold more stock in this company than in 80% of alternative investment opportunities. Pros tend to favor investing in this company. Finally, Market Pulse has a rank of 79 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 79% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 98 (more positive than 98% compared with investment alternatives), DBS Group has a reputation among professional investors that is significantly higher than that of its competitors. Since all market sentiment indicators are positive, the professional community highly recommends investment in the company. Does this mean DBS Group stocks are a safe investment? Far from it. Even professionals make mistakes. Especially in stock investing, there is a tendency to follow the leaders. Since trees don't grow to the heavens, such positive sentiment may also be interpreted as a danger sign. A lot of optimism can often be a sign of troubles to come, albeit unforeseen by most. ...read more
Value Strategy: DBS Group Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 48 (worse than 52% compared with alternatives), DBS Group shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for DBS Group. Price-to-Profit (also referred to as price-earnings, P/E) is 69 which means that the stock price compared with what market professionals expect for future profits is lower than for 69% of comparable companies, indicating a good value concerning DBS Group's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 7, which means that the stock price is lower as regards to invested capital than for 7% of comparable investments. On the other hand, Price-to-Sales is less favorable than 82% of alternatives (only 18% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 8% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 48, is a hold recommendation based on DBS Group's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. ...read more
Growth Strategy: DBS Group Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 45 (better than 45% compared with alternatives), DBS Group 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 DBS Group. Only Capital Growth has a good rank of 85, which means that currently professionals expect the company to grow its invested capital more than 24% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 42 which means that currently professionals expect the company to grow less than 58% of its competitors. Profit Growth with a rank of 24 and Stock Returns with a rank of 41 are also low (below 59% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 45, 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 DBS Group 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: DBS Group Debt Financing Safety below-average
| SAFETY METRICS | May 2, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 35 |
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| REFINANCING | ||||||||
| REFINANCING | 12 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 91 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 32 |
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ANALYSIS: With an Obermatt Safety Rank of 32 (better than 32% compared with alternatives), the company DBS Group 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 DBS Group 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 DBS Group. Liquidity is at 91, meaning the company generates more profit to service its debt than 91% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 12, 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 88% of its competitors. Leverage is also high at a rank of 35, which means that the company has an above-average debt-to-equity ratio. It has more debt than 65% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 32 (worse than 68% compared with alternatives), DBS Group has a financing structure that is riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. ...read more
Combined financial peformance: DBS Group Below-Average Financial Performance
| COMBINED PERFORMANCE | May 2, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 48 |
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| GROWTH | ||||||||
| GROWTH | 45 |
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| SAFETY | ||||||||
| SAFETY | 91 |
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| COMBINED | ||||||||
| COMBINED | 34 |
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ANALYSIS: With an Obermatt Combined Rank of 34 (worse than 66% compared with investment alternatives), DBS Group (Diversified Banks, Singapore) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of DBS Group are low in value (priced high) with a consolidated Value Rank of 48 (worse than 52% of alternatives), show below-average growth (Growth Rank of 45), and are riskily financed (Safety Rank of 32), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 34, is a hold recommendation based on DBS Group's financial characteristics. As the company DBS Group's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 48), low growth (Obermatt Growth Rank of 45), and risky financing practices (Obermatt Safety Rank of 32), 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. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. ...read more
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