September 26, 2024
Top 10 Stock Eicher Motors 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: Eicher Motors – Top 10 Stock in Nifty 50 India Index CNX Nifty 50
Eicher Motors is listed as a top 10 stock on September 26, 2024 in the market index CNX Nifty 50 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, despite a currently slow growth momentum. Based on the Obermatt 360° View of 63 (high 63% performer), Obermatt assesses an overall buy recommendation for Eicher Motors on September 26, 2024.
Snapshot: Obermatt Ranks
| Country | India |
| Industry | Motorcycle Manufacturers |
| Index | CNX Nifty 50 |
| 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 Eicher Motors Buy
| 360 METRICS | September 26, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 67 |
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| GROWTH | ||||||||
| GROWTH | 23 |
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| SAFETY | ||||||||
| SAFETY | 52 |
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| SENTIMENT | ||||||||
| SENTIMENT | 83 |
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| 360° VIEW | ||||||||
| 360° VIEW | 63 |
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ANALYSIS: With an Obermatt 360° View of 63 (better than 63% compared with alternatives), overall professional sentiment and financial characteristics for the stock Eicher Motors are above average. The 360° View is based on consolidating four consolidated indicators, with half of the indicators below and half above average for Eicher Motors. The consolidated Value Rank has an attractive rank of 67, which means that the share price of Eicher Motors is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 67% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 52. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 83. But the consolidated Growth Rank has a low rank of 23, which means that the company is below average in terms of growth and momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. 77 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 63, Eicher Motors is better positioned than 63% of all alternative stock investment opportunities based on the Obermatt Method. Three out of four consolidated Obermatt Ranks show above-average performance. The stock has as good value (Value Rank of 67), secure financing practices (Safety Rank of 52), and positive market sentiment in the professional investor community (Sentiment Rank of 83). It is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely to occur. The company’s growth expectations are below the industry average (Growth Rank of 23), but that could also be temporary since professional investors remain optimistic despite the low growth numbers. The low price as reflected in the good Value Rank could indicate that the company's future is challenging. The below-par growth performance may be the reason for this. Companies that grow less are typically cheaper than fast-growing competitors. We recommend evaluating whether the future of Eicher Motors is as difficult as the stock’s low price suggests, despite the positive professional investor sentiment. Since the professional community is optimistic, you might have less to worry about, and the stock may just go through a more challenging phase now, indicating good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for Eicher Motors very positive
ANALYSIS: With an Obermatt Sentiment Rank of 83 (better than 83% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Eicher Motors is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Eicher Motors. Analyst Opinions are at a rank of 28 (worse than 72% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 49, which means that stock research experts are getting even more pessimistic. Other sentiment indicators are positive: The Professional Investors rank is 89, which means that professional investors hold more stock in this company than in 89% of alternative investment opportunities. So, pros tend to favor investing in this company. In addition, Market Pulse has a rank of 78, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 78% of competitors). While stock research analysts are getting ever more critical, many professional investors are committed to Eicher Motors and the professional news channels are on the positive side. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 83 (more positive than 83% compared with investment alternatives), Eicher Motors has a reputation among professional investors that is significantly higher than that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical, while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: Eicher Motors Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 67 (better than 67% compared with alternatives), Eicher Motors shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Eicher Motors. Price-to-Profit (also referred to as price to earnings, P/E ratio) is 65 which means that the stock price compared with what market professionals expect for future profits is lower than for 65% of comparable companies, indicating a good value concerning Eicher Motors's profit levels. The same is valid for the expected Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 52, and for Dividend Yield with a Dividend Yield Rank of 67. But, compared with other companies in the same industry, the stock price is higher than average as regards expected revenues; only 75% of all competitors have an even higher stock price as regards to sales revenues (a Price-to-Sales Rank of 25). Profits, the level of invested capital, and dividend policy suggest that this stock is attractively priced. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 67, is a buy recommendation based on Eicher Motors's stock price compared with the company's operational size and dividend yields. Since it is on the expensive side for Price-to-Sales, it may mean that Eicher Motors has pricing power in its distribution market because it can charge higher prices than its competitors. If this is the case, all four value indicators are positive signals for purchasing Eicher Motors shares. ...read more
Growth Strategy: Eicher Motors Growth Momentum negative
| GROWTH METRICS | September 26, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 42 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 40 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 28 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 63 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 23 |
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ANALYSIS: With an Obermatt Growth Rank of 23 (better than 23% compared with alternatives), Eicher Motors 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 Eicher Motors. Sales Growth has a below market rank of 42, which means that, currently, professionals expect the company to grow less than 58% of its competitors. The same is valid for Capital Growth, with a rank of 28, and Profit Growth, with a rank of 40. Currently, professionals expect the company to grow its profits less than 60% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 63, which means that the stock returns have recently been above 63% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 23, is a sell recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for Eicher Motors, 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: Eicher Motors Debt Financing Safety above-average
| SAFETY METRICS | September 26, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 74 |
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| REFINANCING | ||||||||
| REFINANCING | 13 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 73 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 52 |
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ANALYSIS: With an Obermatt Safety Rank of 52 (better than 52% compared with alternatives), the company Eicher Motors has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Eicher Motors 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 Eicher Motors. Leverage is at a rank of 74, meaning the company has a below-average debt-to-equity ratio. It has less debt than 74% of its competitors. Liquidity is also good at a rank of 73, meaning the company generates more profit to service its debt than 73% 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 13, 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 87% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 52 (better than 52% compared with alternatives), Eicher Motors has a financing structure that is 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 Eicher Motors. 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: Eicher Motors Below-Average Financial Performance
| COMBINED PERFORMANCE | September 26, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 67 |
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| GROWTH | ||||||||
| GROWTH | 23 |
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| SAFETY | ||||||||
| SAFETY | 73 |
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| COMBINED | ||||||||
| COMBINED | 42 |
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ANALYSIS: With an Obermatt Combined Rank of 42 (worse than 58% compared with investment alternatives), Eicher Motors (Motorcycle Manufacturers, India) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Eicher Motors are a good value (attractively priced) with a consolidated Value Rank of 67 (better than 67% of alternatives), are safely financed (Safety Rank of 52, which means low debt burdens), but show below-average growth (Growth Rank of 23). ...read more
RECOMMENDATION: A Combined Rank of 42, is a hold recommendation based on Eicher Motors's financial characteristics. As the company Eicher Motors's key financial metrics exhibit good value (Obermatt Value Rank of 67) but low growth (Obermatt Growth Rank of 23) while being safely financed (Obermatt Safety Rank of 52), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 67% 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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