May 16, 2024
Top 10 Stock HMM 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: HMM – Top 10 Stock in Korea Composite Stock Price Index KOSPI
HMM is listed as a top 10 stock on May 16, 2024 in the market index KOSPI because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 57 (high 57% performer), Obermatt assesses an overall buy recommendation for HMM on May 16, 2024.
Snapshot: Obermatt Ranks
| Country | South Korea |
| Industry | Marine |
| Index | Low Emissions, KOSPI |
| 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 HMM Buy
| 360 METRICS | May 16, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 57 |
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| GROWTH | ||||||||
| GROWTH | 23 |
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| SAFETY | ||||||||
| SAFETY | 92 |
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| SENTIMENT | ||||||||
| SENTIMENT | 40 |
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| 360° VIEW | ||||||||
| 360° VIEW | 57 |
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ANALYSIS: With an Obermatt 360° View of 57 (better than 57% compared with alternatives), overall professional sentiment and financial characteristics for the stock HMM are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for HMM. The consolidated Value Rank has an attractive rank of 57, which means that the share price of HMM 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 57% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 92. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 40. Professional investors are more confident in 60% other stocks. The consolidated Growth Rank also has a low rank of 23, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 77 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 57, HMM is better positioned than 57% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 57), and the financing structure is on the safer side (Safety Rank of 92). However, sentiment in the professional investor community is below-average (Sentiment Rank of 40), as is the growth momentum for the company (Growth Rank of 23). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for HMM only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 40 (better than 40% compared with alternatives), overall professional sentiment and engagement for the stock HMM is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for HMM. 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 63, 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 HMM. More encouragingly, the Professional Investors rank is 80, which means that professional investors hold more stock in this company than in 80% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 1, 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 99% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 40 (less encouraging than 60% compared with investment alternatives), HMM has a reputation among professional investors that is below that of its competitors. The sentiment signals are mixed for HMM. 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: HMM Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 57 (better than 57% compared with alternatives), HMM shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for HMM. Expected dividend yields are higher than for 61% of comparable companies (a Dividend Yield rank of 61), making the stock attractive. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 87, which means that the stock price is lower compared with invested capital than for 87% of comparable investments. But in respect to sales and profits, the picture is reversed. Price-to-Sales is 28 which means that the stock price compared with what market professionals expect for future profits is higher than for 72% of comparable companies, indicating a low value concerning HMM's sales levels. The Price-to-Profit ratio (also referred to as price-earnings (P/E) ratio) is also unfavorable for HMM with a rank of 38. This means that the stock price, compared with what market professionals expect for future profits, is higher than for 62% of comparable companies, indicating a low value concerning HMM's profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 57, is a buy recommendation based on HMM's stock price compared with the company's operational size and dividend yields. The company seems confident that it can generate a reasonable return on invested capital, because it pays an above-average dividend while profits are below what you would expect for a company with this stock price. If you agree with this practice and believe that profits will return to higher levels, as the current dividend policy suggests, HMM may be an attractive investment. If this is not the case, you may want to be careful with this stock as it is also expensive compared with its expected revenue levels. ...read more
Growth Strategy: HMM Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 23 (better than 23% compared with alternatives), HMM 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 metrics below average for HMM. While Profit Growth has a good rank of 78, as professionals currently expect the company to grow its profits more than 78% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 9, which means that currently professionals expect the company to grow less than 91% of its competitors, while Capital Growth has a rank of 37 and Stock Returns have been below market median, with a rank of 43 (57% of alternative investments were better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 23, is a sell 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: HMM Debt Financing Safety very solid
| SAFETY METRICS | May 16, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 93 |
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| REFINANCING | ||||||||
| REFINANCING | 100 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 42 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 92 |
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ANALYSIS: With an Obermatt Safety Rank of 92 (better than 92% compared with alternatives) for 2024, the company HMM has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of HMM 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 two out of three are above average for HMM.Leverage is at 93, meaning the company has a below-average debt-to-equity ratio. It has less debt than 93% of its competitors.Refinancing is at a rank of 100, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 100% of its competitors. Liquidity is at 42, meaning that the company generates less profit to service its debt than 58% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 92 (better than 92% compared with alternatives), HMM has a financing structure that is significantly safer than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. ...read more
Combined financial peformance: HMM Above-Average Financial Performance
| COMBINED PERFORMANCE | May 16, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 57 |
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| GROWTH | ||||||||
| GROWTH | 23 |
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| SAFETY | ||||||||
| SAFETY | 42 |
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| COMBINED | ||||||||
| COMBINED | 66 |
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ANALYSIS: With an Obermatt Combined Rank of 66 (better than 66% compared with investment alternatives), HMM (Marine, South Korea) shares have above-average financial characteristics compared with similar stocks. Shares of HMM are a good value (attractively priced) with a consolidated Value Rank of 57 (better than 57% of alternatives), are safely financed (Safety Rank of 92, which means low debt burdens), but show below-average growth (Growth Rank of 23). ...read more
RECOMMENDATION: A Combined Rank of 66, is a buy recommendation based on HMM's financial characteristics. As the company HMM's key financial metrics exhibit good value (Obermatt Value Rank of 57) but low growth (Obermatt Growth Rank of 23) while being safely financed (Obermatt Safety Rank of 92), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 57% 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. ...read more
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