October 10, 2024
Top 10 Stock Diversified Energy 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: Diversified Energy – Top 10 Stock in Sound Pay Practices in the United States
Diversified Energy is listed as a top 10 stock on October 10, 2024 in the market index Sound Pay USA because of its high performance in at least one of the Obermatt investment strategies. As three out of four consolidated Obermatt Ranks exhibit excellent performance, it is a solid investment where the risk of paying too much for the shares is low. Based on the Obermatt 360° View of 67 (high 67% performer), Obermatt assesses an overall buy recommendation for Diversified Energy on October 10, 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 Buy
| 360 METRICS | October 10, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 91 |
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| GROWTH | ||||||||
| GROWTH | 61 |
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| SAFETY | ||||||||
| SAFETY | 1 |
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| SENTIMENT | ||||||||
| SENTIMENT | 81 |
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| 360° VIEW | ||||||||
| 360° VIEW | 67 |
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ANALYSIS: With an Obermatt 360° View of 67 (better than 67% compared with alternatives), overall professional sentiment and financial characteristics for the stock Diversified Energy are above average. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Diversified Energy. The consolidated Value Rank has an attractive rank of 91, 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 the stock price is lower than for 91% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 61, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth, as well as stock returns. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 81. But the company’s financing is risky with a Safety rank of 1. This means 99% of comparable companies have a safer financing structure than Diversified Energy. ...read more
RECOMMENDATION: With a consolidated 360° View of 67, Diversified Energy is better positioned than 67% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 91), above-average growth (Growth Rank of 61), and positive market sentiment in the professional investor community (Sentiment Rank of 81), it is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely, unless information not publicly available. Only the company financing structure is on the riskier side (Safety Rank of 1), but that would also mean better returns for shareholders if things work out well. Good value is sometimes an indication that the company's future is challenging. If they have been growing above average and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of Diversified Energy is as difficult as the low price of the stock, despite good growth and positive professional investor sentiment, suggests. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible right now, which may indicate good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for Diversified Energy very positive
ANALYSIS: With an Obermatt Sentiment Rank of 81 (better than 81% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Diversified Energy is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the indicators below and the other half above average for Diversified Energy. Analyst Opinions are at a rank of 89 (better than 89% 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 76 which means that currently, professional investors hold more stock in this company than in 76% of alternative investment opportunities. But Analyst Opinions Change has a rank of 26, 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 Diversified Energy. Furthermore, Market Pulse has a rank of 46, 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 54% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 81 (more positive than 81% compared with investment alternatives), Diversified Energy has a reputation among professional investors that is significantly higher than 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: Diversified Energy Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 91 (better than 91% 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, where three out of four indicators are above average for Diversified Energy. Price-to-Sales (P/S) is 95 which means that the stock price compared with what market professionals expect for future sales is lower than for 95% of comparable companies, indicating a good value for Diversified Energy's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 76. Finally, compared with other companies in the same industry, dividend yields of Diversified Energy are expected to be higher than for 99% of all competitors (a Dividend Yield rank of 99). The only low rank is for expected profits with a Price-to-Profit Rank of 31, indicating that the market expects the company's profit to be low despite a high dividend. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 91, is a buy recommendation based on Diversified Energy's stock price compared with the company's operational size and dividend yields. The low Profit Rank could result from a one-off charge, for instance, for an accident, a legal settlement, or a restructuring project. If the company keeps its dividends high, the low expected profit may be transitory. If that is the case, the three good value ranks for Sales, Capital, and Dividends are reliable indicators for good stock price value, a low stock price. ...read more
Growth Strategy: Diversified Energy Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 61 (better than 61% compared with alternatives), Diversified Energy shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Diversified Energy. Sales Growth has a rank of 84 which means that currently, professionals expect the company to grow more than 84% of its competitors. Capital Growth is also above 23% of competitors with a rank of 96. But Profit Growth only has a rank of 23, which means that currently professionals expect the company to grow its profits less than 77% of its competitors. And Stock Returns have also been below average with a rank of only 9. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 61, is a buy recommendation for growth and momentum investors. Profits are sometimes low if the company invests in the future. The positive revenue and capital investment outlook confirms such an interpretation. Both revenues and capital are solid growth indicators, and lower profits in such a case would be encouraging. But the investors see it differently by punishing the share price. Sometimes, Mister Market is not very reliable, because it is not uncommon for it to be volatile. Investors should look out for signs of growth expenditure that could justify low profit growth, and they may also find reasons why recent stock price developments don't confirm the growth outlook of operations. While operating growth indicators are not perfect, they are more reliable indicators for future performance than stock prices that can repeatedly surprise investors. ...read more
Safety Strategy: Diversified Energy Debt Financing Safety risky
| SAFETY METRICS | October 10, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 2 |
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| REFINANCING | ||||||||
| REFINANCING | 1 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 4 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 1 |
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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 all three metrics below average for Diversified Energy. Liquidity is at 4, meaning that the company generates less profit to service its debt than 96% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 2, meaning the company has an above-average debt-to-equity ratio. It has more debt than 98% of its competitors. Finally, Refinancing is at a rank of 1 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 99% 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. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing.
Combined financial peformance: Diversified Energy Above-Average Financial Performance
| COMBINED PERFORMANCE | October 10, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 91 |
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| GROWTH | ||||||||
| GROWTH | 61 |
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| SAFETY | ||||||||
| SAFETY | 4 |
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| COMBINED | ||||||||
| COMBINED | 51 |
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ANALYSIS: With an Obermatt Combined Rank of 51 (better than 51% compared with investment alternatives), Diversified Energy (Oil & Gas Production, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Diversified Energy are a good value (attractively priced) with a consolidated Value Rank of 91 (better than 91% of alternatives), show above-average growth (Growth Rank of 61) but are riskily financed (Safety Rank of 1), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 51, is a buy recommendation based on Diversified Energy's financial characteristics. As the company Diversified Energy's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 91) and above-average growth (Obermatt Growth Rank of 61), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 1) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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