June 22, 2023
Top 10 Stock Ferroglobe Sell 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: Ferroglobe – Top 10 Stock in Iron & Steel Mining and Production
Ferroglobe is listed as a top 10 stock on June 22, 2023 in the market index Iron because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company enjoys a positive professional investor sentiment, but all financial facts speak against a stock purchase. This is probably an investment into the future. Based on the Obermatt 360° View of 24 (24% performer), Obermatt issues an overall sell recommendation for Ferroglobe on June 22, 2023.
Snapshot: Obermatt Ranks
| Country | United Kingdom |
| Industry | Diversified Metals & Mining |
| Index | Human Rights, Iron, Sound Pay Europe, Solar Tech, NASDAQ |
| Size class | 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 Ferroglobe Sell
| 360 METRICS | June 22, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 21 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 15 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 44 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 89 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 24 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 24 (better than 24% compared with alternatives), overall professional sentiment and financial characteristics for the stock Ferroglobe are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Ferroglobe. The consolidated Sentiment Rank has a good rank of 89, which means that professional investors are more optimistic about the stock than for 89% of alternative investment opportunities. But all other ranks are below average. The consolidated Value Rank has a rank of 21, which means that the share price of Ferroglobe is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. The consolidated Growth Rank also has a low rank of 15, meaning that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. This means that growth is lower than for 15% of competitors in the same industry. Finally, the consolidated Safety Rank has a riskier rank of 44 which means that the company has a riskier financing structure than 56% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. ...read more
RECOMMENDATION: With a 360° View of 24, Ferroglobe is worse than 76% of all alternative stock investment opportunities based on the Obermatt Method. This means that Ferroglobe shares are on the riskier side for investors. As only the professional market sentiment (Sentiment Rank of 89) is above-average, and all other consolidated Obermatt Ranks are below peers, the stock investing proposition case is rather weak. The stock price is expensive for a company of this size in this industry, visible in the below-average Value Rank. Growth is below the competition based on the Growth Rank, and the company has more debt than other companies, according to the Safety Rank. So the question becomes: How important is the Sentiment Rank when all others are below average? When it comes to growth, the low rating might be justified if growth is expected in the future and not yet reflected in current performance. This is often the case for companies with intellectual property, such as technology and pharmaceutical companies. In the early phases, these companies are expensive compared with their size and may have a lot of debt on their books, as is the case here, as seen in the low Value and Safety Ranks. Future growth may be the strongest investment rationale in this case, which is only reflected by institutional investors' opinions. You pay more than the market average for this stock and invest in a rather debt-loaded enterprise, but it may be worth it if the future of Ferroglobẹ is bright. A small investment might be justified, but proceed with caution. ...read more
Sentiment Strategy: Professional Market Sentiment for Ferroglobe very positive
ANALYSIS: With an Obermatt Sentiment Rank of 89 (better than 89% compared with alternatives) for 2023, overall professional sentiment and engagement for the stock Ferroglobe is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Ferroglobe. Analyst Opinions are at a rank of 72 (better than 72% 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 Ferroglobe. Finally, the Professional Investors rank is 94, which means that currently, professional investors hold more stock in this company than in 94% of alternative investment opportunities. ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 89 (more positive than 89% compared with investment alternatives), Ferroglobe 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 13, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 87% of competitors). This could mean future risks and should make investors careful. Attention to negative news for Ferroglobe 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: Ferroglobe Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 21 (worse than 79% compared with alternatives), Ferroglobe shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half are above average for Ferroglobe. Price-to-Sales (P/S) is 64, which means that the stock price compared with what market professionals expect for future sales is lower than for 64% of comparable companies, indicating a good value concerning Ferroglobe's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 77% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 1 (dividends are expected to be higher than for 1% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 66% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Ferroglobe to 34. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 21, is a SELL recommendation based on Ferroglobe's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner on assets than its competitors. For instance, the company could be leasing its production facilities, or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the low Dividend Yield is also explained as such companies tend to invest their income into market development. The other good value ranks for Sales and Profits are encouraging indicators for the stock price value. ...read more
Growth Strategy: Ferroglobe Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 15 (better than 15% compared with alternatives), Ferroglobe 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 three out of four indicators below-average for Ferroglobe. While Sales Growth ranks at 88, professionals currently expect the company to grow more than 88% of its competitors, while all other growth ranks are below the market median. Profit Growth has a rank of 4, which means that, currently, professionals expect the company to grow its profits less than 96% of its competitors, and Capital Growth has a low rank of 17. Historic stock returns were also below average with a current Stock Returns rank of 11 which means that the stock returns have recently been below 89% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 15, is a SELL recommendation for growth and momentum investors. If revenues are expected to increase, but all other growth indicators are negative, the company may be investing in future growth through means not visible in the balance sheet and thus not reflected in capital growth. The fact that Stock Returns have been below market doesn't mean that much, as it may be due to overly optimistic investor behavior in the past, which has been corrected to a more reasonable level recently. If that were the case, a positive Value Rank would be a reason to invest because the company is still expected to grow, while stock prices are now at a more reasonable level. ...read more
Safety Strategy: Ferroglobe Debt Financing Safety below-average
| SAFETY METRICS | June 22, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 34 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 73 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 36 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 44 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 44 (better than 44% compared with alternatives), the company Ferroglobe 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 Ferroglobe 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 Ferroglobe and the other two below average. Refinancing is at 73, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 73% 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 36, meaning the company generates less profit to service its debt than 64% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 44 (worse than 56% compared with alternatives), Ferroglobe 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 Ferroglobe 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: Ferroglobe Lowest Financial Performance
| COMBINED PERFORMANCE | June 22, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 21 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 15 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 36 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 1 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 1 (worse than 99% compared with investment alternatives), Ferroglobe (Diversified Metals & Mining, United Kingdom) shares have lower financial characteristics compared with similar stocks. Shares of Ferroglobe are low in value (priced high) with a consolidated Obermatt Value Rank of 21 (worse than 79% of alternatives), show below-average growth (Growth Rank of 15), and are riskily financed (Safety Rank of 44), which means above-average debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 1, is a sell recommendation based on Ferroglobe's financial characteristics. As the company Ferroglobe's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 21), low growth (Obermatt Growth Rank of 15), and risky financing practices (Obermatt Safety Rank of 44), 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. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.