July 6, 2023
Top 10 Stock Flowserve 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: Flowserve – Top 10 Stock in Recycling Leaders
Flowserve is listed as a top 10 stock on July 06, 2023 in the market index Recycling 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 91 (top 91% performer), Obermatt assesses an overall strong buy recommendation for Flowserve on July 06, 2023.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Industrial Machinery |
| Index | Dividends USA, Low Waste, Recycling, Water Tech, S&P 500 |
| Size class | X-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 Flowserve Strong Buy
| 360 METRICS | July 6, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 90 |
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| GROWTH | ||||||||
| GROWTH | 99 |
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| SAFETY | ||||||||
| SAFETY | 49 |
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| SENTIMENT | ||||||||
| SENTIMENT | 54 |
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| 360° VIEW | ||||||||
| 360° VIEW | 91 |
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ANALYSIS: With an Obermatt 360° View of 91 (better than 91% compared with alternatives) for 2023, overall professional sentiment and financial characteristics for the stock Flowserve are very positive. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Flowserve. The consolidated Value Rank has an attractive rank of 90, which means that the share price of Flowserve 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 90% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 99, 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 54. But the company’s financing is risky with a Safety rank of 49. This means 51% of comparable companies have a safer financing structure than Flowserve. ...read more
RECOMMENDATION: With a consolidated 360° View of 91, Flowserve is better positioned than 91% 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 90), above-average growth (Growth Rank of 99), and positive market sentiment in the professional investor community (Sentiment Rank of 54), 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 49), 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 Flowserve 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 Flowserve positive
ANALYSIS: With an Obermatt Sentiment Rank of 54 (better than 54% compared with alternatives), overall professional sentiment and engagement for the stock Flowserve is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Flowserve. Analyst Opinions are at a rank of 36 (worse than 64% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 50, which means that stock research experts are more positive in their investment recommendations in the company. In other words, they are getting more optimistic of stock investments in Flowserve. More encouragingly, the Professional Investors rank is 82, which means that professional investors hold more stock in this company than in 82% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 43, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 57% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 54 (more positive than 54% compared with investment alternatives), Flowserve has a reputation among professional investors that is above-average compared with that of its competitors. The sentiment signals are mixed for Flowserve. While analysts and the news channels are negative, there is a change in what analysts think. Above-average institutional investors in this company support them. Sentiment signals remain mixed with analysts and news channels pessimistic, though improving, and professional investors above average. ...read more
Value Strategy: Flowserve Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 90 (better than 90% compared with alternatives) for 2023, Flowserve shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Flowserve. Price-to-Sales is 78 which means that the stock price compared with what market professionals expect for future sales is lower than for 78% of comparable companies, indicating a good value for Flowserve's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 62% 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 70. Compared with other companies in the same industry, dividend yields of Flowserve are expected to be higher than for 90% of all competitors (a Dividend Yield rank of 90). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 90, is a buy recommendation based on Flowserve'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 Flowserve based on its detailed value metrics.
Growth Strategy: Flowserve Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 99 (better than 99% compared with alternatives) for 2023, Flowserve shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Flowserve. Sales Growth has a value of 82 which means that currently professionals expect the company to grow more than 82% of its competitors. Profit Growth with a value of 96 and Capital Growth with a rank of 93 means that currently, professionals expect the company to grow both profits and invested capital more than of its competitors. But Stock Returns has only a rank of 45, which means that stock returns have recently been below 55% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 99, is a buy recommendation for growth and momentum investors. Flowserve has only one below-average growth indicator, the stock returns. This is probably the least reliable growth indicator, because it measures company and investor expectations at the same time. The three other growth indicators, which are all positive for Flowserve, are more reliable measures of growth momentum. For this reason, the company seems to be on a good trajectory, unless you think the current period is not representative, because of unique events that will not be repeated in the future. ...read more
Safety Strategy: Flowserve Debt Financing Safety below-average
| SAFETY METRICS | July 6, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 30 |
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| REFINANCING | ||||||||
| REFINANCING | 84 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 23 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 49 |
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ANALYSIS: With an Obermatt Safety Rank of 49 (better than 49% compared with alternatives), the company Flowserve 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 Flowserve 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 Flowserve and the other two below average. Refinancing is at 84, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 84% of its competitors. But Leverage is high with a rank of 30, meaning the company has an above-average debt-to-equity ratio. It has more debt than 70% of its competitors. Liquidity is also on the riskier side with a rank of 23, meaning the company generates less profit to service its debt than 77% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 49 (worse than 51% compared with alternatives), Flowserve 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 Flowserve 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: Flowserve Top Financial Performance
| COMBINED PERFORMANCE | July 6, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 90 |
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| GROWTH | ||||||||
| GROWTH | 99 |
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| SAFETY | ||||||||
| SAFETY | 23 |
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| COMBINED | ||||||||
| COMBINED | 96 |
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ANALYSIS: With an Obermatt Combined Rank of 96 (better than 96% compared with investment alternatives), Flowserve (Industrial Machinery, USA) shares have much better financial characteristics than comparable stocks. Shares of Flowserve are a good value (attractively priced) with a consolidated Value Rank of 90 (better than 90% of alternatives), show above-average growth (Growth Rank of 99) but are riskily financed (Safety Rank of 49), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 96, is a strong buy recommendation based on Flowserve's financial characteristics. As the company Flowserve's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 90) and above-average growth (Obermatt Growth Rank of 99), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 49) 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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