March 28, 2024
Top 10 Stock Elkem ASA Strong 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: Elkem ASA – Top 10 Stock in Renewable Energy Use Leaders
Elkem ASA is listed as a top 10 stock on March 28, 2024 in the market index Renewables Users 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 from a financial fact perspective where only investor sentiment is a reason for caution. Based on the Obermatt 360° View of 78 (top 78% performer), Obermatt assesses an overall strong buy recommendation for Elkem ASA on March 28, 2024.
Snapshot: Obermatt Ranks
| Country | Norway |
| Industry | Specialty Chemicals |
| Index | Dividends Europe, Energy Efficient, Renewables Users |
| 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 Elkem ASA Strong Buy
| 360 METRICS | March 28, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 100 |
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| GROWTH | ||||||||
| GROWTH | 60 |
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| SAFETY | ||||||||
| SAFETY | 55 |
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| SENTIMENT | ||||||||
| SENTIMENT | 30 |
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| 360° VIEW | ||||||||
| 360° VIEW | 78 |
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ANALYSIS: With an Obermatt 360° View of 78 (better than 78% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock Elkem ASA are very positive. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators above average for Elkem ASA. The consolidated Value Rank has an attractive rank of 100, which means that the share price of Elkem ASA 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 100% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 60, 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. The company is also safely financed with a Safety Rank of 55. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of only 30. Professional investors are more confident in 70% other stocks. ...read more
RECOMMENDATION: With a consolidated 360° View of 78, Elkem ASA is better positioned than 78% 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 100), above-average growth (Growth Rank of 60), and safe financing practices (Safety Rank of 55), 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 professional market sentiment is on the riskier side (Sentiment Rank of 30), but that could also mean an overreaction to negative news in the past. Good value is sometimes an indication that the company's future is challenging. If they have been enjoying above average growth and are still a good value, this may not continue. We recommend evaluating whether the future of Elkem ASA is as challenging as the low price of the stock despite good growth and safe financing practices suggest. Since the professional community is pessimistic, you may want to reflect these negative opinions in light of what you find reasonable to expect for the future. If you believe this pessimistic view is transitory, you have a solid investment case based on current financial factors. ...read more
Sentiment Strategy: Professional Market Sentiment for Elkem ASA only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 30 (better than 30% compared with alternatives), overall professional sentiment and engagement for the stock Elkem ASA is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Elkem ASA. Analyst Opinions are at a rank of 52 (better than 52% 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 and has a rank of 50 which means that currently, stock research experts are getting even more optimistic about investments in Elkem ASA. But Market Pulse has a low rank of 15, 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 85% of competitors). This is an essential sign of caution, as it could be the forebearer of bad news. Professional Investors are also somewhat absent with a rank of 28, which means that, currently, professional investors hold less stock in this company than in 72% of alternative investment opportunities. Pros tend to invest in other companies. This is expected if the company is of a smaller size (medium or smaller). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 30 (less encouraging than 70% compared with investment alternatives), Elkem ASA has a reputation among professional investors that is below that of its competitors. While the general news feeds in the professional market are negative, the analyst recommendations are optimistic about the company, and even increase their ratings despite the negative news. This is an ambiguous situation with positive and negative signals from the professional side. Investors should be on the lookout for negative news but not worry too much about it as long as the overall news is still positive. ...read more
Value Strategy: Elkem ASA Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 100 (better than 100% compared with alternatives) for 2024, Elkem ASA shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Elkem ASA. Price-to-Sales is 83 which means that the stock price compared with what market professionals expect for future sales is lower than for 83% of comparable companies, indicating a good value for Elkem ASA's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 75% 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 83. Compared with other companies in the same industry, dividend yields of Elkem ASA are expected to be higher than for 78% of all competitors (a Dividend Yield rank of 78). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 100, is a buy recommendation based on Elkem ASA'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 Elkem ASA based on its detailed value metrics.
Growth Strategy: Elkem ASA Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 60 (better than 60% compared with alternatives), Elkem ASA 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 Elkem ASA. Sales Growth has a rank of 91, which means that, currently, professionals expect the company to grow more than 91% of its competitors. Profit Growth with a rank of 100 is also above average. But Capital Growth has only a rank of 12, and Stock Returns with 27 are also below-average. Stock returns for Elkem ASA have recently been below 73% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 60, is a buy recommendation for growth and momentum investors. Are investors forecasting troubles based on the lack of operating investment activity at the company? This could be one explanation as to why stock returns are low. But stock returns can also be the result of correcting an error in the past, in this case, an overly optimistic outlook on the future, which is now more realistic. The Value Ranks may confirm such a picture. The more important growth indicators are revenues and profits, which are both above average for Elkem ASA. This is a positive sign from the company's operational side and may give investors courage, despite the poor recent stock price performance. ...read more
Safety Strategy: Elkem ASA Debt Financing Safety above-average
| SAFETY METRICS | March 28, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 34 |
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| REFINANCING | ||||||||
| REFINANCING | 89 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 19 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 55 |
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ANALYSIS: With an Obermatt Safety Rank of 55 (better than 55% compared with alternatives), the company Elkem ASA 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 Elkem ASA 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 just one indicator above average for Elkem ASA and the other two below average. Refinancing is at 89, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 89% of its competitors. But Leverage is high with a rank of 34, meaning the company has an above-average debt-to-equity ratio. It has more debt than 66% of its competitors. Liquidity is also on the riskier side with a rank of 19, meaning the company generates less profit to service its debt than 81% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 55 (better than 55% compared with alternatives), Elkem ASA has a financing structure that is safer than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Elkem ASA are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. ...read more
Combined financial peformance: Elkem ASA Top Financial Performance
| COMBINED PERFORMANCE | March 28, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 100 |
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| GROWTH | ||||||||
| GROWTH | 60 |
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| SAFETY | ||||||||
| SAFETY | 19 |
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| COMBINED | ||||||||
| COMBINED | 91 |
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ANALYSIS: With an Obermatt Combined Rank of 91 (better than 91% compared with investment alternatives), Elkem ASA (Specialty Chemicals, Norway) shares have much better financial characteristics than comparable stocks. Shares of Elkem ASA are a good value (attractively priced) with a consolidated Value Rank of 100 (better than 100% of alternatives), show above-average growth (Growth Rank of 60), and are safely financed (Safety Rank of 55), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 91, is a strong buy recommendation based on Elkem ASA's financial characteristics. As the company Elkem ASA's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 100), above-average growth (Obermatt Growth Rank of 60), and indicate that the company is safely financed (Obermatt Safety Rank of 55), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of Elkem ASA. 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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