Fact based stock research
Faro Technologies (NasdaqGS:FARO)

US3116421021

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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.

(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.

Faro Technologies stock research in summary

faro.com

ANALYSIS: With an Obermatt Combined Rank of 98 (better than 98% compared with investment alternatives), Faro Technologies (Electronic Equipment, USA) shares have much better financial characteristics than comparable stocks. Shares of Faro Technologies are low in value (priced high) with a consolidated Value Rank of 49 (worse than 51% of alternatives) and show below-average growth (Growth Rank of 41) but are safely financed (Safety Rank of 89), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 98, is a strong buy recommendation based on Faro Technologies's financial characteristics. As the company Faro Technologies's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 49) and low growth (Obermatt Growth Rank of 41), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 89) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. 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	49
Growth Rank	41
Safety Rank	89
Combined Rank	98

Country	USA
Industry	Electronic Equipment
Index	NASDAQ
Size class	Medium

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

Further information

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

Research History: Faro Technologies

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	18	89	61	49
GROWTH
GROWTH	31	87	9	41
SAFETY
SAFETY	14	49	58	89
SENTIMENT
SENTIMENT	n/a	17	34	^new
360° VIEW
360° VIEW	n/a	69	49	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Faro Technologies is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	18	89	61	49
GROWTH
GROWTH	31	87	9	41
SAFETY
SAFETY	14	49	58	89
COMBINED
COMBINED	6	56	53	98

Last update of combined financial performance: 4-Jul-2024. Stock analysis on combined financial performance: The higher the rank of Faro Technologies the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 49 (worse than 51% compared with alternatives), Faro Technologies shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half above average for Faro Technologies. Price-to-Sales (P/S) is 67, which means that the stock price compared with what market professionals expect for future sales is lower than for 67% of comparable companies, indicating a good value concerning Faro Technologies's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio), which is more favorable than for 66% of alternatives (34% of peers have a higher ratio). But expected dividend yields with a Dividend Yield rank of 1 are lower than average (dividends are expected to be lower than 99% of other stocks) while the Price to Profit ratio (or Price to Earnings (P/E) ratio) is higher than average with a Price-to-Profit Rank of 29, making the stock more expensive compared with the company's expected profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 49, is a hold recommendation based on Faro Technologies's stock price compared with the company's operational size and dividend yields. Low profits and low dividends as seen here for Faro Technologies may indicate a restructuring phase. This could be transitory, making the company a good value when profits recover and dividends return to higher levels. If the stock price is compared with the size indicators for revenue and invested capital, it is on the lower side, making this stock a good value investment (apart from current profit and dividend expectations). 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)	57	74	93	67
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	29	24	14	29
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	37	66	83	66
DIVIDEND YIELD
DIVIDEND YIELD	1	100	1	1
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	18	89	61	49

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Faro Technologies; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 41 (better than 41% compared with alternatives), Faro Technologies shows a below-average growth dynamic in its industry. There is limited 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 Faro Technologies. Profit Growth has a rank of 98, which means that currently professionals expect the company to grow its profits more than 98% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 71 (above 71% of alternative investments). But Sales Growth has a below the median rank of 15, which means that, currently, professionals expect the company to grow less than 85% of its competitors, and Capital Growth also has a lower rank of 13. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 41, is a hold recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for Faro Technologies. 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	11	68	29	15
PROFIT GROWTH
PROFIT GROWTH	25	100	4	98
CAPITAL GROWTH
CAPITAL GROWTH	n/a	70	71	13
STOCK RETURNS
STOCK RETURNS	46	37	9	71
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	31	87	9	41

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Faro Technologies.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 89 (better than 89% compared with alternatives) for 2024, the company Faro Technologies has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Faro Technologies 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 where two out of three are above average for Faro Technologies.Leverage is at 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 69, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 69% of its competitors. Liquidity is at 49, meaning that the company generates less profit to service its debt than 51% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 89 (better than 89% compared with alternatives), Faro Technologies has a financing structure that is significantly safer than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. Investors should compare Obermatt’s Value, Growth, and Sentiment Ranks before deciding. They may also want to investigate why cash flows are expected to be low, making debt service for Faro Technologies more challenging. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	69	86	80	57
REFINANCING
REFINANCING	35	65	85	69
LIQUIDITY
LIQUIDITY	1	15	12	49
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	14	49	58	89

Last update of Safety Rank: 4-Jul-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Faro Technologies 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	34	76	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	41	41	^new
MARKET PULSE
MARKET PULSE	n/a	34	13	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	17	34	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Faro Technologies.
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