September 26, 2024
Top 10 Stock Evonik 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: Evonik – Top 10 Stock in Deutscher Aktienindex Mid Cap MDAX
Evonik is listed as a top 10 stock on September 26, 2024 in the market index MDAX 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. Based on the Obermatt 360° View of 88 (top 88% performer), Obermatt assesses an overall strong buy recommendation for Evonik on September 26, 2024.
Snapshot: Obermatt Ranks
| Country | Germany |
| Industry | Specialty Chemicals |
| Index | CDAX, Low Emissions, Dividends Europe, Human Rights, SDG 12, SDG 13, SDG 3, SDG 6, MDAX |
| Size class | XX-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 Evonik Strong Buy
| 360 METRICS | September 26, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 88 |
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| GROWTH | ||||||||
| GROWTH | 62 |
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| SAFETY | ||||||||
| SAFETY | 42 |
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| SENTIMENT | ||||||||
| SENTIMENT | 84 |
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| 360° VIEW | ||||||||
| 360° VIEW | 88 |
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ANALYSIS: With an Obermatt 360° View of 88 (better than 88% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock Evonik are very positive. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Evonik. The consolidated Value Rank has an attractive rank of 88, which means that the share price of Evonik 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 88% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 62, 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. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 84. But the company’s financing is risky with a Safety rank of 42. This means 58% of comparable companies have a safer financing structure than Evonik. ...read more
RECOMMENDATION: With a consolidated 360° View of 88, Evonik is better positioned than 88% 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 88), above-average growth (Growth Rank of 62), and positive market sentiment in the professional investor community (Sentiment Rank of 84), 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 company financing structure is on the riskier side (Safety Rank of 42), but that would also mean better returns for shareholders if things work out well. Good value is sometimes an indication that the company's future is challenging. If they have been growing above average and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of Evonik is as difficult as the low price of the stock, despite good growth and positive professional investor sentiment, suggests. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible right now, which may indicate good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for Evonik very positive
ANALYSIS: With an Obermatt Sentiment Rank of 84 (better than 84% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Evonik is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Evonik. Analyst Opinions are at a rank of 74 (better than 74% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. In addition, Analyst Opinions Change has a rank of 81, which means that stock research experts are changing their opinions for the better in recommending investing in the company. In other words, they are getting even more optimistic about investments in Evonik. Finally, the Professional Investors rank is 78, which means that currently, professional investors hold more stock in this company than in 78% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 84 (more positive than 84% compared with investment alternatives), Evonik has a reputation among professional investors that is significantly higher than that of its competitors. Pros tend to favor investing in this company. But there is also a signal for caution. Market Pulse has a rank of 43, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 57% of competitors). This could mean future risks and should make investors careful. Attention to negative news for Evonik is worthwhile because they may be early warning signals. Without those, all other professional signals are encouraging, especially since analysts are getting more optimistic. ...read more
Value Strategy: Evonik Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 88 (better than 88% compared with alternatives) for 2024, Evonik shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Evonik. Price-to-Sales is 68 which means that the stock price compared with what market professionals expect for future sales is lower than for 68% of comparable companies, indicating a good value for Evonik's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 64% 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 75. Compared with other companies in the same industry, dividend yields of Evonik are expected to be higher than for 92% of all competitors (a Dividend Yield rank of 92). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 88, is a buy recommendation based on Evonik'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 Evonik based on its detailed value metrics.
Growth Strategy: Evonik Growth Momentum good
| GROWTH METRICS | September 26, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 8 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 89 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 56 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 81 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 62 |
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ANALYSIS: With an Obermatt Growth Rank of 62 (better than 62% compared with alternatives), Evonik 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 all but one indicator above average for Evonik. Profit Growth has a rank of 89 which means that currently professionals expect the company to grow its profits more than 89% of its competitors. The same is valid for capital growth and stock returns. Capital Growth has a rank of 56, and Stock Returns has a rank of 81 which means that the stock returns have recently been above 81% of alternative investments. Only revenue growth is low with a Sales Growth has a rank of 8 (92% of its competitors are better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 62, is a buy recommendation for growth and momentum investors. The many positive growth indicators indicate a positive growth momentum with only low revenue growth. That can also be attributed to divestments or the sale of unprofitable businesses. If that is the reason, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: Evonik Debt Financing Safety below-average
| SAFETY METRICS | September 26, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 57 |
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| REFINANCING | ||||||||
| REFINANCING | 34 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 49 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 42 |
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ANALYSIS: With an Obermatt Safety Rank of 42 (better than 42% compared with alternatives), the company Evonik 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 Evonik 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 Evonik and the other two below average. Leverage is at a rank of 57 meaning the company has a below-average debt-to-equity ratio. It has less debt than 57% of its competitors.Refinancing is at a rank of 34, which means that the portion of the debt about to be refinanced is above-average. It has more debt in the refinancing stage than 66% of its competitors. Liquidity is at a rank of 49, meaning that the company generates less profit to service its debt than 51% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 42 (worse than 58% compared with alternatives), Evonik has a financing structure that is riskier than that of its competitors. This is an indication that the company is on the riskier side when it comes to debt service. There is only below-market average liquidity, and a short-term refinancing issue might be around the corner. But in the long-term, the debt levels of Evonik are on the safer side. ...read more
Combined financial peformance: Evonik Top Financial Performance
| COMBINED PERFORMANCE | September 26, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 88 |
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| GROWTH | ||||||||
| GROWTH | 62 |
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| SAFETY | ||||||||
| SAFETY | 49 |
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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), Evonik (Specialty Chemicals, Germany) shares have much better financial characteristics than comparable stocks. Shares of Evonik are a good value (attractively priced) with a consolidated Value Rank of 88 (better than 88% of alternatives), show above-average growth (Growth Rank of 62) but are riskily financed (Safety Rank of 42), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 82, is a strong buy recommendation based on Evonik's financial characteristics. As the company Evonik's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 88) and above-average growth (Obermatt Growth Rank of 62), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 42) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. 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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