June 6, 2024
Top 10 Stock Highwealth Construction Hold 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: Highwealth Construction – Top 10 Stock in FTSE Taiwan Index
Highwealth Construction is listed as a top 10 stock on June 06, 2024 in the market index FTSE Taiwan because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company is growing above average, but all other facts speak against a stock purchase, especially the low market sentiment by professional investors. Based on the Obermatt 360° View of 47 (47% performer), Obermatt assesses an overall hold recommendation for Highwealth Construction on June 06, 2024.
Snapshot: Obermatt Ranks
| Country | Taiwan |
| Industry | Real Estate Development |
| Index | FTSE Taiwan |
| 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 Highwealth Construction Hold
| 360 METRICS | June 6, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 7 |
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| GROWTH | ||||||||
| GROWTH | 97 |
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| SAFETY | ||||||||
| SAFETY | 47 |
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| SENTIMENT | ||||||||
| SENTIMENT | 39 |
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| 360° VIEW | ||||||||
| 360° VIEW | 47 |
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ANALYSIS: With an Obermatt 360° View of 47 (better than 47% compared with alternatives), overall professional sentiment and financial characteristics for the stock Highwealth Construction are below the industry average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Highwealth Construction. The consolidated Growth Rank has a good rank of 97, 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. It ranks higher than 97% of competitors in the same industry. The other indicators are below average, namely the Value, Safety, and Sentiment Ranks.The Value Rank at 7 means that the share price of Highwealth Construction is on the high side compared with its peers regarding revenues, profits, and invested capital. The stock price is higher than for 93% of alternative stocks in the same industry. The consolidated Safety Rank has a riskier rank of 47, which means that the company has a riskier financing structure than 53% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. The consolidated Sentiment Rank also has a low rank of 39, indicating professional investors are more pessimistic about the stock than for 61% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 47, Highwealth Construction is worse than 53% of all alternative stock investment opportunities based on the Obermatt Method. As only one of the consolidated Obermatt Ranks exhibits excellent performance, namely the above-average growth (Growth Rank of 97), it is a riskier stock investment proposition. Aside from the critical professional market sentiment (Sentiment Rank of 39), the company is rather risky when it comes to financing (Safety Rank of 47). The negative market view on Highwealth Construction may be due to the high stock price (low value). A growth company like this may get too expensive at one point in time. If too many investors are desperate to join the party, they may drive stock prices above reasonable levels. While it is typical for growth companies to have low value, because investors are willing to pay more for companies that are expected to have high growth, the crucial question is: how much more do you pay for the stock of Highwealth Construction compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one minus the growth rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value (even though it is lower than 50). As market sentiment is critical, you should be careful with paying more than market-average for this stock and conduct further research into the company's future growth potential. ...read more
Sentiment Strategy: Professional Market Sentiment for Highwealth Construction only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 39 (better than 39% compared with alternatives), overall professional sentiment and engagement for the stock Highwealth Construction is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Highwealth Construction. Analyst Opinions are at a rank of 100 (better than 100% 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 50, 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 Highwealth Construction. Finally, the Professional Investors rank is 73, which means that currently, professional investors hold more stock in this company than in 73% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 39 (less encouraging than 61% compared with investment alternatives), Highwealth Construction has a reputation among professional investors that is below 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 5, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 95% of competitors). This could mean future risks and should make investors careful. Attention to negative news for Highwealth Construction 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: Highwealth Construction Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 7 (worse than 93% compared with alternatives), Highwealth Construction shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Highwealth Construction. Price-to-Sales is 46 which means that the stock price compared with what market professionals expect for future profits is higher than 54% of comparable companies, indicating a low value concerning Highwealth Construction's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 14, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Highwealth Construction. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 12 and Dividend Yield, which is lower than 87% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 7, is a sell recommendation based on Highwealth Construction's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Highwealth Construction? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Highwealth Construction? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Highwealth Construction may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. ...read more
Growth Strategy: Highwealth Construction Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 97 (better than 97% compared with alternatives) for 2024, Highwealth Construction 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 Highwealth Construction. Sales Growth has a rank of 99 which means that currently, professionals expect the company to grow more than 99% of its competitors. Both Profit Growth, with a rank of 99, and Stock Returns, with a rank of 63, are also above average. But Capital Growth only has a rank of 9, which means that, currently, professionals expect the company to grow its invested capital less than 91% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 97, is a buy recommendation for growth and momentum investors. That may be a good sign if the company is already well positioned and doesn't require more investments at this time. They may focus on growing the top (revenues) and bottom (profits) lines, recently rewarded with above-average stock returns for shareholders. But it may also be a sign of danger as the company is falling back with capital investment activities concerning competition. This requires further analysis of corporate communications. ...read more
Safety Strategy: Highwealth Construction Debt Financing Safety below-average
| SAFETY METRICS | June 6, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 2 |
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| REFINANCING | ||||||||
| REFINANCING | 79 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 64 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 47 |
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ANALYSIS: With an Obermatt Safety Rank of 47 (better than 47% compared with alternatives), the company Highwealth Construction 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 Highwealth Construction 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 two out of three indicators above-average for Highwealth Construction. Refinancing is at 79, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 79% of its competitors. Liquidity is also good at 64, meaning the company generates more profit to service its debt than 64% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 2, which means the company has an above-average debt-to-equity ratio. It has more debt than 98% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 47 (worse than 53% compared with alternatives), Highwealth Construction has a financing structure that is riskier than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Highwealth Construction could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. ...read more
Combined financial peformance: Highwealth Construction Above-Average Financial Performance
| COMBINED PERFORMANCE | June 6, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 7 |
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| GROWTH | ||||||||
| GROWTH | 97 |
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| SAFETY | ||||||||
| SAFETY | 64 |
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| COMBINED | ||||||||
| COMBINED | 51 |
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ANALYSIS: With an Obermatt Combined Rank of 51 (better than 51% compared with investment alternatives), Highwealth Construction (Real Estate Development, Taiwan) shares have above-average financial characteristics compared with similar stocks. Shares of Highwealth Construction are low in value (priced high) with a consolidated Value Rank of 7 (worse than 93% of alternatives), and are riskily financed (Safety Rank of 47, which means above-average debt burdens) but show above-average growth (Growth Rank of 97). ...read more
RECOMMENDATION: A Combined Rank of 51, is a buy recommendation based on Highwealth Construction's financial characteristics. As the company Highwealth Construction shows low value with an Obermatt Value Rank of 7 (93% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 97% of comparable companies (Obermatt Growth Rank is 97). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 47 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Highwealth Construction, even a low-value company (in terms of its key financial indicators) can be a good investment. ...read more
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