Fact based stock research
Engro (KASE:ENGRO)

PK0012101017

How to read the free 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.

Engro stock research in summary

engro.com

ANALYSIS: With an Obermatt Combined Rank of 10 (worse than 90% compared with investment alternatives), Engro (Fertilizers & Agricultural Chemicals, Pakistan) shares have lower financial characteristics compared with similar stocks. Shares of Engro are a good value (attractively priced) with a consolidated Value Rank of 81 (better than 81% of alternatives) but show below-average growth (Growth Rank of 19), and are riskily financed (Safety Rank of 4), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 10, is a sell recommendation based on Engro's financial characteristics. As the company Engro's key financial metrics exhibit good value (Obermatt Value Rank of 81) but low growth (Obermatt Growth Rank of 19) and risky financing practices (Obermatt Safety Rank of 4), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 81% 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. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	81
Growth Rank	19
Safety Rank	4
Combined Rank	10

Country	Pakistan
Industry	Fertilizers & Agricultural Chemicals
Index
Size class	Large

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Engro

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	100	95	97	81
GROWTH
GROWTH	15	41	29	19
SAFETY
SAFETY	27	35	15	4
SENTIMENT
SENTIMENT	n/a	69	76	^new
360° VIEW
360° VIEW	n/a	77	65	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Engro is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	100	95	97	81
GROWTH
GROWTH	15	41	29	19
SAFETY
SAFETY	27	35	15	4
COMBINED
COMBINED	53	73	45	10

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Engro the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 81 (better than 81% compared with alternatives) for 2024, Engro shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Engro. Price-to-Sales is 86 which means that the stock price compared with what market professionals expect for future sales is lower than for 86% of comparable companies, indicating a good value for Engro's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 56% 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 74. Compared with other companies in the same industry, dividend yields of Engro 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 81, is a buy recommendation based on Engro'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 Engro based on its detailed value metrics. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	93	85	86	86
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	98	95	97	56
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	94	86	82	74
DIVIDEND YIELD
DIVIDEND YIELD	98	97	100	100
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	100	95	97	81

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Engro; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 19 (better than 19% compared with alternatives), Engro 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 half of the indicators below and half above average for Engro. Sales Growth has a rank of 65 which means that currently professionals expect the company to grow more than 65% of its competitors. Stock Returns are also above average with a rank of 53. But Capital Growth has only a rank of 7, which means that currently professionals expect the company to grow its invested capital less than 93% of its competitors. Profit Growth is also low, with a rank of only 18, which means that, currently, professionals expect the company to grow its profits below average. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 19, is a sell recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 53% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	26	57	15	65
PROFIT GROWTH
PROFIT GROWTH	n/a	72	36	18
CAPITAL GROWTH
CAPITAL GROWTH	n/a	47	25	7
STOCK RETURNS
STOCK RETURNS	18	17	77	53
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	15	41	29	19

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Engro.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 4 (better than 4% compared with alternatives), the company Engro 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 Engro 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 Engro. Liquidity is at 25, meaning that the company generates less profit to service its debt than 75% 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 8, meaning the company has an above-average debt-to-equity ratio. It has more debt than 92% of its competitors. Finally, Refinancing is at a rank of 4 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 96% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 4 (worse than 96% compared with alternatives), Engro 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. Investors should look at Obermatt’s Value, Growth, and Sentiment Ranks to confirm a very positive outlook or be careful with investing in stocks of Engro because it may suffer significantly in case of future difficulties. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	6	12	10	8
REFINANCING
REFINANCING	50	96	68	4
LIQUIDITY
LIQUIDITY	38	20	18	25
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	27	35	15	4

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Engro and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	67	67	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	n/a	n/a	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	88	100	^new
MARKET PULSE
MARKET PULSE	n/a	7	25	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	69	76	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Engro.
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