September 12, 2024
Top 10 Stock Dowa 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: Dowa – Top 10 Stock in Iron & Steel Mining and Production
Dowa is listed as a top 10 stock on September 12, 2024 in the market index Iron because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 69 (high 69% performer), Obermatt assesses an overall buy recommendation for Dowa on September 12, 2024.
Snapshot: Obermatt Ranks
| Country | Japan |
| Industry | Diversified Metals & Mining |
| Index | Copper, Energy Efficient, Iron, Zinc, SDG 12, Silver, Nikkei 225 |
| Size class | X-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 Dowa Buy
| 360 METRICS | September 12, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 79 |
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| GROWTH | ||||||||
| GROWTH | 37 |
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| SAFETY | ||||||||
| SAFETY | 86 |
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| SENTIMENT | ||||||||
| SENTIMENT | 36 |
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| 360° VIEW | ||||||||
| 360° VIEW | 69 |
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ANALYSIS: With an Obermatt 360° View of 69 (better than 69% compared with alternatives), overall professional sentiment and financial characteristics for the stock Dowa are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Dowa. The consolidated Value Rank has an attractive rank of 79, which means that the share price of Dowa 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 79% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 86. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 36. Professional investors are more confident in 64% other stocks. The consolidated Growth Rank also has a low rank of 37, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 63 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 69, Dowa is better positioned than 69% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 79), and the financing structure is on the safer side (Safety Rank of 86). However, sentiment in the professional investor community is below-average (Sentiment Rank of 36), as is the growth momentum for the company (Growth Rank of 37). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for Dowa only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 36 (better than 36% compared with alternatives), overall professional sentiment and engagement for the stock Dowa is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the indicators below and above average for Dowa. Analyst Opinions are at a rank of 5 (worse than 95% 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 50 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 Dowa. Market Pulse is also positive with a rank of 69, which means that the current professional news and professional social networks are positive in their discussions about this company (more positive news than for 69% of competitors). Only professional investors tend to be absent with a Professional Investors rank of 45, which means that professional investors hold less stock in this company than in 55% 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 36 (less encouraging than 64% compared with investment alternatives), Dowa has a reputation among professional investors that is below 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: Dowa Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 79 (better than 79% compared with alternatives) for 2024, Dowa 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 Dowa. Price-to-Sales (P/S) is 77 which means that the stock price compared with what market professionals expect for future sales is lower than for 77% of comparable companies, indicating a good value for Dowa'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 71. Finally, compared with other companies in the same industry, dividend yields of Dowa are expected to be higher than for 54% of all competitors (a Dividend Yield rank of 54). The only low rank is for expected profits with a Price-to-Profit Rank of 49, 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 79, is a buy recommendation based on Dowa'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: Dowa Growth Momentum low
| GROWTH METRICS | September 12, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 45 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 35 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 45 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 57 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 37 |
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ANALYSIS: With an Obermatt Growth Rank of 37 (better than 37% compared with alternatives), Dowa 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 Dowa. Sales Growth has a below market rank of 45, which means that, currently, professionals expect the company to grow less than 55% of its competitors. The same is valid for Capital Growth, with a rank of 45, and Profit Growth, with a rank of 35. Currently, professionals expect the company to grow its profits less than 65% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 57, which means that the stock returns have recently been above 57% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 37, is a hold recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for Dowa, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with recent above-market stock returns. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive stock returns are not yet a sign of recovery. Investors should look closely at the Value and Sentiment indicators before they make a stock purchasing decision, because growth is unlikely to be the driving argument behind this investment. ...read more
Safety Strategy: Dowa Debt Financing Safety very solid
| SAFETY METRICS | September 12, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 56 |
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| REFINANCING | ||||||||
| REFINANCING | 69 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 86 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 86 |
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ANALYSIS: With an Obermatt Safety Rank of 86 (better than 86% compared with alternatives) for 2024, the company Dowa has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Dowa 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, where all three are above average for Dowa. Leverage is at 56, meaning the company has a below-average debt-to-equity ratio. It has less debt than 56% of its competitors. Refinancing is at a rank of 69, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 69% of its competitors. Finally, Liquidity is also good at a rank of 86, which means that the company generates more profit to service its debt than 86% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 86 (better than 86% compared with alternatives), Dowa has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more
Combined financial peformance: Dowa Top Financial Performance
| COMBINED PERFORMANCE | September 12, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 79 |
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| GROWTH | ||||||||
| GROWTH | 37 |
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| SAFETY | ||||||||
| SAFETY | 86 |
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| COMBINED | ||||||||
| COMBINED | 82 |
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ANALYSIS: With an Obermatt Combined Rank of 82 (better than 82% compared with investment alternatives), Dowa (Diversified Metals & Mining, Japan) shares have much better financial characteristics than comparable stocks. Shares of Dowa are a good value (attractively priced) with a consolidated Value Rank of 79 (better than 79% of alternatives), are safely financed (Safety Rank of 86, which means low debt burdens), but show below-average growth (Growth Rank of 37). ...read more
RECOMMENDATION: A Combined Rank of 82, is a strong buy recommendation based on Dowa's financial characteristics. As the company Dowa's key financial metrics exhibit good value (Obermatt Value Rank of 79) but low growth (Obermatt Growth Rank of 37) while being safely financed (Obermatt Safety Rank of 86), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 79% of comparable companies, may also indicate that 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 and the downside is limited due to below-average financing risks. ...read more
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