July 4, 2024
Top 10 Stock Diversified Energy Sell 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: Diversified Energy – Top 10 Stock in FTSE All Share Index
Diversified Energy is listed as a top 10 stock on July 04, 2024 in the market index FTSE All Shares 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 13 (13% performer), Obermatt issues an overall sell recommendation for Diversified Energy on July 04, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Oil & Gas Production |
| Index | FTSE All Shares, FTSE 250, FTSE 350, Dividends USA, Sound Pay USA |
| Size class | Large |
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 Diversified Energy Sell
| 360 METRICS | July 4, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 96 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 1 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 1 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 33 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 13 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 13 (better than 13% compared with alternatives), overall professional sentiment and financial characteristics for the stock Diversified Energy are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Diversified Energy. Only the consolidated Value Rank has an attractive rank of 96, which means that the share price of Diversified Energy 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 96% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 1, 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 1, meaning the company has a riskier financing structure than 99% 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 67% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 33. ...read more
RECOMMENDATION: With a consolidated 360° View of 13, Diversified Energy is worse than 87% of all alternative stock investment opportunities based on the Obermatt Method. This means that Diversified Energy shares are on the riskier side for investors. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 96. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 1), a riskier financing structure than the competition (Safety Rank of 1), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 33) 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 Diversified Energy 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 Diversified Energy. 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 Diversified Energy only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 33 (better than 33% compared with alternatives), overall professional sentiment and engagement for the stock Diversified Energy is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Diversified Energy. Analyst Opinions are at a rank of 93 (better than 93% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. This is a good sign, were it not for Analyst Opinions Change with a low rank of 24, which means that currently, stock research experts are changing their opinions for the worse. In other words, they are getting more critical of a stock investment in Diversified Energy. The Professional Investors rank is also low at 22, meaning that professional investors hold less stock in this company than in 78% of alternative investment opportunities. Pros tend to invest in other companies. Even worse, Market Pulse has a low rank of 25, which means that the current professional news and professional social networks are critical of this company (more negative news than for 75% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 33 (less encouraging than 67% compared with investment alternatives), Diversified Energy has a reputation among professional investors that is below that of its competitors. There are several negative sentiment signals, with only the Analyst Opinions Rank above average. This could be a stock with a long reputation for being positive but where things are worsening. Most analysts may not see it yet, but some have, and the professionals are already quite pessimistic. Proceed with caution when investing in this stock. ...read more
Value Strategy: Diversified Energy Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 96 (better than 96% compared with alternatives) for 2024, Diversified Energy shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Diversified Energy. Price-to-Sales is 97 which means that the stock price compared with what market professionals expect for future sales is lower than for 97% of comparable companies, indicating a good value for Diversified Energy's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 59% 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 63. Compared with other companies in the same industry, dividend yields of Diversified Energy are expected to be higher than for 100% of all competitors (a Dividend Yield rank of 100). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 96, is a buy recommendation based on Diversified Energy'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 Diversified Energy based on its detailed value metrics.
Growth Strategy: Diversified Energy Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 1 (better than 1% compared with alternatives), Diversified Energy shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four indicators below-average for Diversified Energy. While Sales Growth ranks at 65, professionals currently expect the company to grow more than 65% of its competitors, while all other growth ranks are below the market median. Profit Growth has a rank of 14, which means that, currently, professionals expect the company to grow its profits less than 86% of its competitors, and Capital Growth has a low rank of 14. Historic stock returns were also below average with a current Stock Returns rank of 4 which means that the stock returns have recently been below 96% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 1, is a sell recommendation for growth and momentum investors. If revenues are expected to increase, but all other growth indicators are negative, the company may be investing in future growth through means not visible in the balance sheet and thus not reflected in capital growth. The fact that Stock Returns have been below market doesn't mean that much, as it may be due to overly optimistic investor behavior in the past, which has been corrected to a more reasonable level recently. If that were the case, a positive Value Rank would be a reason to invest because the company is still expected to grow, while stock prices are now at a more reasonable level. ...read more
Safety Strategy: Diversified Energy Debt Financing Safety risky
| SAFETY METRICS | July 4, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 2 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 1 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 99 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 1 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 1 (better than 1% compared with alternatives), the company Diversified Energy 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 Diversified Energy 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 Diversified Energy. Liquidity is at 99, meaning the company generates more profit to service its debt than 99% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 1, 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 99% of its competitors. Leverage is also high at a rank of 2, which means that the company has an above-average debt-to-equity ratio. It has more debt than 98% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 1 (worse than 99% compared with alternatives), Diversified Energy has a financing structure that is significantly 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: Diversified Energy Lowest Financial Performance
| COMBINED PERFORMANCE | July 4, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 96 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 1 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 99 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 15 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 15 (worse than 85% compared with investment alternatives), Diversified Energy (Oil & Gas Production, USA) shares have lower financial characteristics compared with similar stocks. Shares of Diversified Energy are a good value (attractively priced) with a consolidated Value Rank of 96 (better than 96% of alternatives) but show below-average growth (Growth Rank of 1), and are riskily financed (Safety Rank of 1), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 15, is a sell recommendation based on Diversified Energy's financial characteristics. As the company Diversified Energy's key financial metrics exhibit good value (Obermatt Value Rank of 96) but low growth (Obermatt Growth Rank of 1) and risky financing practices (Obermatt Safety Rank of 1), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 96% 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
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.