Fact based stock research
Equatorial Energia (BOVESPA:EQTL3)
BREQTLACNOR0
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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.
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Equatorial Energia stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 14 (worse than 86% compared with investment alternatives), Equatorial Energia (Electric Utilities, Brazil) shares have lower financial characteristics compared with similar stocks. Shares of Equatorial Energia are a good value (attractively priced) with a consolidated Value Rank of 59 (better than 59% of alternatives) but show below-average growth (Growth Rank of 14), and are riskily financed (Safety Rank of 32), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 14, is a sell recommendation based on Equatorial Energia's financial characteristics. As the company Equatorial Energia's key financial metrics exhibit good value (Obermatt Value Rank of 59) but low growth (Obermatt Growth Rank of 14) and risky financing practices (Obermatt Safety Rank of 32), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 59% 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
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Research History: Equatorial Energia
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 68 |
|
60 |
|
53 |
|
59 |
|
| GROWTH | ||||||||
| GROWTH | 60 |
|
5 |
|
93 |
|
14 |
|
| SAFETY | ||||||||
| SAFETY | 82 |
|
63 |
|
17 |
|
32 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
39 |
|
57 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
28 |
|
63 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 14 (worse than 86% compared with investment alternatives), Equatorial Energia (Electric Utilities, Brazil) shares have lower financial characteristics compared with similar stocks. Shares of Equatorial Energia are a good value (attractively priced) with a consolidated Value Rank of 59 (better than 59% of alternatives) but show below-average growth (Growth Rank of 14), and are riskily financed (Safety Rank of 32), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 14, is a sell recommendation based on Equatorial Energia's financial characteristics. As the company Equatorial Energia's key financial metrics exhibit good value (Obermatt Value Rank of 59) but low growth (Obermatt Growth Rank of 14) and risky financing practices (Obermatt Safety Rank of 32), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 59% 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
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 68 |
|
60 |
|
53 |
|
59 |
|
| GROWTH | ||||||||
| GROWTH | 60 |
|
5 |
|
93 |
|
14 |
|
| SAFETY | ||||||||
| SAFETY | 82 |
|
63 |
|
17 |
|
32 |
|
| COMBINED | ||||||||
| COMBINED | 82 |
|
32 |
|
57 |
|
14 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 59 (better than 59% compared with alternatives), Equatorial Energia 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 Equatorial Energia. Price-to-Sales (P/S) is 79, which means that the stock price compared with what market professionals expect for future sales is lower than for 79% of comparable companies, indicating a good value regarding Equatorial Energia's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 64% of alternatives, and it's also true for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 57. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 32% of all competitors have even lower dividend yields than Equatorial Energia (a Dividend Yield Rank of 32). 68% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 59, is a buy recommendation based on Equatorial Energia's stock price compared with the company's operational size and dividend yields. The below-average dividend yield may be a good sign, as it could mean the company has more attractive investment opportunities for the generated cash than to pay it out as dividends. A low dividend yield can also indicate a growth phase. 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) | 71 |
|
66 |
|
71 |
|
79 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 69 |
|
72 |
|
56 |
|
64 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 44 |
|
48 |
|
33 |
|
57 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 48 |
|
47 |
|
37 |
|
32 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 68 |
|
60 |
|
53 |
|
59 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 14 (better than 14% compared with alternatives), Equatorial Energia 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 Equatorial Energia. Sales Growth has a rank of 53, which means that, currently, professionals expect the company to grow more than 53% of its competitors. Profit Growth with a rank of 55 is also above average. But Capital Growth has only a rank of 4, and Stock Returns with 18 are also below-average. Stock returns for Equatorial Energia have recently been below 82% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 14, is a sell 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 Equatorial Energia. This is a positive sign from the company's operational side and may give investors courage, despite the poor recent stock price performance. 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 the Obermatt 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 | 79 |
|
17 |
|
46 |
|
53 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 53 |
|
18 |
|
68 |
|
55 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
32 |
|
97 |
|
4 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 48 |
|
49 |
|
59 |
|
18 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 60 |
|
5 |
|
93 |
|
14 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 32 (better than 32% compared with alternatives), the company Equatorial Energia has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Equatorial Energia 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 just one indicator above average for Equatorial Energia and the other two below average. Refinancing is at 68, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 68% of its competitors. But Leverage is high with a rank of 17, meaning the company has an above-average debt-to-equity ratio. It has more debt than 83% of its competitors. Liquidity is also on the riskier side with a rank of 34, meaning the company generates less profit to service its debt than 66% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 32 (worse than 68% compared with alternatives), Equatorial Energia has a financing structure that is riskier 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 Equatorial Energia 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. In the long-term, investors may have a debt challenge with Equatorial Energia and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more
| SAFETY METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 45 |
|
26 |
|
12 |
|
17 |
|
| REFINANCING | ||||||||
| REFINANCING | 87 |
|
83 |
|
51 |
|
68 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 55 |
|
65 |
|
29 |
|
34 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 82 |
|
63 |
|
17 |
|
32 |
|
Sentiment Metrics in Detail
| SENTIMENT | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| ANALYST OPINIONS | ||||||||
| ANALYST OPINIONS | n/a |
|
60 |
|
57 |
|
new |
|
| OPINIONS CHANGE | ||||||||
| OPINIONS CHANGE | n/a |
|
35 |
|
82 |
|
new |
|
| PRO HOLDINGS | ||||||||
| PRO HOLDINGS | n/a |
|
65 |
|
60 |
|
new |
|
| MARKET PULSE | ||||||||
| MARKET PULSE | n/a |
|
32 |
|
15 |
|
new |
|
| CONSOLIDATED RANK: SENTIMENT | ||||||||
| CONSOLIDATED RANK: SENTIMENT | n/a |
|
39 |
|
57 |
|
new |
|
Free stock analysis by the purely fact based Obermatt Method for Equatorial Energia from November 14, 2024.
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