Fact based stock research
Fortum (HLSE:FORTUM)

FI0009007132

How to read the free 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.

Fortum stock research in summary

fortum.fi

ANALYSIS: With an Obermatt Combined Rank of 56 (better than 56% compared with investment alternatives), Fortum (Electric Utilities, Finland) shares have above-average financial characteristics compared with similar stocks. Shares of Fortum are a good value (attractively priced) with a consolidated Value Rank of 51 (better than 51% of alternatives), are safely financed (Safety Rank of 88, which means low debt burdens), but show below-average growth (Growth Rank of 29). ...read more

RECOMMENDATION: A Combined Rank of 56, is a buy recommendation based on Fortum's financial characteristics. As the company Fortum's key financial metrics exhibit good value (Obermatt Value Rank of 51) but low growth (Obermatt Growth Rank of 29) while being safely financed (Obermatt Safety Rank of 88), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 51% of comparable companies, may also indicate that 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 and the downside is limited due to below-average financing risks. 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	51
Growth Rank	29
Safety Rank	88
Combined Rank	56

Country	Finland
Industry	Electric Utilities
Index	OMX 25, Low Emissions, Dividends Europe, Nuclear
Size class	X-Large

This stock has achievements: Insight 2018-06-28, Top 10 Stock.

14-Nov-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: Fortum

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	54	93	68	51
GROWTH
GROWTH	92	27	3	29
SAFETY
SAFETY	26	60	89	88
SENTIMENT
SENTIMENT	n/a	15	26	^new
360° VIEW
360° VIEW	n/a	49	42	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Fortum is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	54	93	68	51
GROWTH
GROWTH	92	27	3	29
SAFETY
SAFETY	26	60	89	88
COMBINED
COMBINED	57	68	54	56

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Fortum the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 51 (better than 51% compared with alternatives), Fortum 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 below average for Fortum. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 82% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 31 which means that the stock price compared with what market professionals expect for future profits is higher than 69% of comparable companies, indicating a low value concerning Fortum's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 45 which means that the stock price compared with what market professionals expect for future profit levels is higher than 55% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 49 is also low. Compared with invested capital, the stock price is higher than for 51% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 51, is a buy recommendation based on Fortum's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Fortum? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose Fortum only if they reasonably expect the low current profit levels to be transitory. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	100	93	36	31
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	15	58	61	45
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	35	70	52	49
DIVIDEND YIELD
DIVIDEND YIELD	60	91	94	82
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	54	93	68	51

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Fortum; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 29 (better than 29% compared with alternatives), Fortum 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 Fortum. Capital Growth has a rank of 50, which means that currently professionals expect the company to grow its invested capital more than 35% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 77 (above 77% of alternative investments). But Sales Growth has only a rank of 9, which means that, currently, professionals expect the company to grow less than 91% of its competitors, and Profit Growth is also low at a rank of 35. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 29, is a hold recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for Fortum, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. 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	100	4	12	9
PROFIT GROWTH
PROFIT GROWTH	15	53	23	35
CAPITAL GROWTH
CAPITAL GROWTH	n/a	57	23	50
STOCK RETURNS
STOCK RETURNS	75	71	27	77
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	92	27	3	29

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Fortum.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 88 (better than 88% compared with alternatives) for 2024, the company Fortum has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Fortum 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 all three are above average for Fortum. Leverage is at 75, meaning the company has a below-average debt-to-equity ratio. It has less debt than 75% of its competitors. Refinancing is at a rank of 87, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 87% of its competitors. Finally, Liquidity is also good at a rank of 66, which means that the company generates more profit to service its debt than 66% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 88 (better than 88% compared with alternatives), Fortum has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. Investors may not have a debt issue with Fortum but they should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	69	76	62	75
REFINANCING
REFINANCING	4	7	89	87
LIQUIDITY
LIQUIDITY	46	82	75	66
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	26	60	89	88

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Fortum 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	23	43	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	55	57	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	73	50	^new
MARKET PULSE
MARKET PULSE	n/a	1	15	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	15	26	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Fortum.
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