May 23, 2024
Top 10 Stock Freenet 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: Freenet – Top 10 Stock in Germany TECDAX
Freenet is listed as a top 10 stock on May 23, 2024 in the market index TecDAX because of its high performance in at least one of the Obermatt investment strategies. As all consolidated Obermatt Ranks exhibit excellent performance, including positive market sentiment in the professional investor community, it is a solid stock investment where the risk of paying too much for the shares is limited. Based on the Obermatt 360° View of 75 (top 75% performer), Obermatt assesses an overall strong buy recommendation for Freenet on May 23, 2024.
Snapshot: Obermatt Ranks
| Country | Germany |
| Industry | Wireless Telecommunication |
| Index | CDAX, Dividends Europe, Renewables Users, MDAX, TecDAX |
| 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 Freenet Strong Buy
| 360 METRICS | May 23, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 66 |
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| GROWTH | ||||||||
| GROWTH | 55 |
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| SAFETY | ||||||||
| SAFETY | 61 |
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| SENTIMENT | ||||||||
| SENTIMENT | 54 |
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| 360° VIEW | ||||||||
| 360° VIEW | 75 |
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ANALYSIS: With an Obermatt 360° View of 75 (better than 75% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock Freenet are very positive. The 360° View is based on consolidating four consolidated indicators, with all four indicators above average for Freenet. The consolidated Value Rank has an attractive rank of 66, which means that the share price of Freenet 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 66% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 55, 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. The company is also safely financed with a Safety rank of 61. Finally, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 54. ...read more
RECOMMENDATION: With a consolidated 360° View of 75, Freenet is better positioned than 75% of all alternative stock investment opportunities based on the Obermatt Method. As all consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 66), above-average growth (Growth Rank of 55), safe financing practices (Safety Rank of 61), and a 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 to occur, unless information not publicly available. High-Value Ranks sometimes indicate that the company's future is challenging. If they are safely financed and have above average growth, and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of Freenet is as difficult as the stock’s low price, despite what good growth and safe financing practice suggest. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible, which may indicate good timing right now. ...read more
Sentiment Strategy: Professional Market Sentiment for Freenet positive
ANALYSIS: With an Obermatt Sentiment Rank of 54 (better than 54% compared with alternatives), overall professional sentiment and engagement for the stock Freenet is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Freenet. Analyst Opinions are at a rank of 83 (better than 83% 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 64, which means that currently, stock research experts are getting even more optimistic. Obermatt Market Pulse further supports this with a rank of 50, which means that the current professional news and professional social networks are generally positive when discussing this company (more positive news than for 50% of competitors). But there are few stock holdings by institutional investors. The Professional Investors rank is low at 24, which means that currently, professional investors hold less stock in this company than in 76% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 54 (more positive than 54% compared with investment alternatives), Freenet has a reputation among professional investors that is above-average compared with that of its competitors. Not having too many professionals invested in Freenet may be less of an issue, especially if the stock is from a smaller company where professionals typically invest less. It is natural for professional investors to focus on large and extra-large companies, as they provide more safety. Smaller companies attract fewer professionals in the shareholder community. Overall, the signals from the professionals are still quite favorable for investments in Freenet. ...read more
Value Strategy: Freenet Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 66 (better than 66% compared with alternatives), Freenet 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 above average for Freenet. Price-to-Sales (P/S) is 51, which means that the stock price compared with what market professionals expect for future sales is lower than for 51% of comparable companies, indicating a good value concerning Freenet's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 69% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 82 (dividends are expected to be higher than 82% 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 60% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Freenet to 40. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 66, is a buy recommendation based on Freenet'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 in 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 three good value ranks for Sales, Profits, and Dividends are reliable indicators for the stock price value. ...read more
Growth Strategy: Freenet Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 55 (better than 55% compared with alternatives), Freenet 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 three out of four metrics below average for Freenet. While Profit Growth has a good rank of 82, as professionals currently expect the company to grow its profits more than 82% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 41, which means that currently professionals expect the company to grow less than 59% of its competitors, while Capital Growth has a rank of 23 and Stock Returns have been below market median, with a rank of 47 (53% of alternative investments were better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 55, is a buy recommendation for growth and momentum investors. While revenue growth and capital growth are good growth momentum indicators, profit is less reliable, because profits may increase due to cost-cutting measures which typically indicate negative growth momentum. "You can save a dollar only once" is the saying about such situations. Growth Investors should look at company priorities closely if they are interested in growth, because the increase in profits is not usually an indicator of growth, and stock prices have been below market, too. ...read more
Safety Strategy: Freenet Debt Financing Safety above-average
| SAFETY METRICS | May 23, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 75 |
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| REFINANCING | ||||||||
| REFINANCING | 22 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 64 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 61 |
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ANALYSIS: With an Obermatt Safety Rank of 61 (better than 61% compared with alternatives), the company Freenet has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Freenet 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, with two out of three indicators above average for Freenet. Leverage is at a rank of 75, meaning the company has a below-average debt-to-equity ratio. It has less debt than 75% of its competitors. Liquidity is also good at a rank of 64, meaning the company generates more profit to service its debt than 64% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 22, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 78% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 61 (better than 61% compared with alternatives), Freenet has a financing structure that is safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Freenet. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. ...read more
Combined financial peformance: Freenet Top Financial Performance
| COMBINED PERFORMANCE | May 23, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 66 |
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| GROWTH | ||||||||
| GROWTH | 55 |
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| SAFETY | ||||||||
| SAFETY | 64 |
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| COMBINED | ||||||||
| COMBINED | 75 |
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ANALYSIS: With an Obermatt Combined Rank of 75 (better than 75% compared with investment alternatives), Freenet (Wireless Telecommunication, Germany) shares have much better financial characteristics than comparable stocks. Shares of Freenet are a good value (attractively priced) with a consolidated Value Rank of 66 (better than 66% of alternatives), show above-average growth (Growth Rank of 55), and are safely financed (Safety Rank of 61), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 75, is a strong buy recommendation based on Freenet's financial characteristics. As the company Freenet's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 66), above-average growth (Obermatt Growth Rank of 55), and indicate that the company is safely financed (Obermatt Safety Rank of 61), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of Freenet. 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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