January 16, 2025
Top 10 Stock Hotai Finance 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: Hotai Finance – Top 10 Stock in FTSE Taiwan Index
Hotai Finance is listed as a top 10 stock on January 16, 2025 in the market index FTSE Taiwan because of its high performance in at least one of the Obermatt investment strategies. Three consolidated Obermatt Ranks are above-average. Only the Value Rank is below average. The investment rationale may be an investment in future growth, supported by professional market opinion. Based on the Obermatt 360° View of 94 (top 94% performer), Obermatt assesses an overall strong buy recommendation for Hotai Finance on January 16, 2025.
Snapshot: Obermatt Ranks
| Country | Taiwan |
| Industry | Consumer Finance |
| 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 Hotai Finance Strong Buy
| 360 METRICS | January 16, 2025 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 21 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 100 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 71 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 97 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 94 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 94 (better than 94% compared with alternatives) for 2025, overall professional sentiment and financial characteristics for the stock Hotai Finance are very positive. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Hotai Finance. The consolidated Growth Rank has a good rank of 100, 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. This means that growth is higher than for 100% of competitors in the same industry. The consolidated Safety Rank at 71 means that the company has a financing structure that is safer than 71% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a good rank of 97, which means that professional investors are more optimistic about the stock than for 97% of alternative investment opportunities. But the consolidated Value Rank is less desirable at 21, meaning that the share price of Hotai Finance is on the higher side compared with indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 79% of alternative stocks in the same industry. ...read more
RECOMMENDATION: With a consolidated 360° View of 94, Hotai Finance is better positioned than 94% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as above-average growth (Growth Rank of 100), a safe financing structure (Safety Rank of 71), and positive professional market sentiment (Sentiment Rank of 97), it is a solid stock investment where growth may be the strongest driver of the investment rationale, also reflected by institutional investors. It is typical for growth companies to have low value, as is the case here. Investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of Hotai Finance compared with alternatives? You can use the following rule of thumb: The growth rank measures the growth momentum of the company (100% better than peers). The value rank could be the reverse reflection of that (0%). A Value Rank below that level may be assessed as expensive, a rank above that is still good value. Sometimes market sentiment just reflects the past, sometimes the reality. You pay more than the market average for this stock, but it may be worth it. ...read more
Sentiment Strategy: Professional Market Sentiment for Hotai Finance very positive
ANALYSIS: With an Obermatt Sentiment Rank of 97 (better than 97% compared with alternatives) for 2025, overall professional sentiment and engagement for the stock Hotai Finance is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Hotai Finance. 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 currently, stock research experts are getting even more optimistic. Obermatt Market Pulse further supports this with a rank of 100, which means that the current professional news and professional social networks are generally positive when discussing this company (more positive news than for 100% of competitors). But there are few stock holdings by institutional investors. The Professional Investors rank is low at 37, which means that currently, professional investors hold less stock in this company than in 63% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 97 (more positive than 97% compared with investment alternatives), Hotai Finance has a reputation among professional investors that is significantly higher than that of its competitors. Not having too many professionals invested in Hotai Finance 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 Hotai Finance. ...read more
Value Strategy: Hotai Finance Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 21 (worse than 79% compared with alternatives), Hotai Finance 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 Hotai Finance. 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 Hotai Finance's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 22, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Hotai Finance. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 22 and Dividend Yield, which is lower than 68% 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 21, is a sell recommendation based on Hotai Finance's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Hotai Finance? 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 Hotai Finance? 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. Hotai Finance 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: Hotai Finance Growth Momentum high
| GROWTH METRICS | January 16, 2025 | |||||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 98 |
|
||||||
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 41 |
|
||||||
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 96 |
|
||||||
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 83 |
|
||||||
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 100 |
|
||||||
ANALYSIS: With an Obermatt Growth Rank of 100 (better than 100% compared with alternatives) for 2025, Hotai Finance 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 Hotai Finance. Sales Growth has a rank of 98 which means that currently, professionals expect the company to grow more than 98% of its competitors. Capital Growth is also above 41% of competitors with a rank of 96, and Stock Returns with the rank of 83 is also an outperformance. Only Profit Growth is low with a rank of 41 which means that currently, professionals expect the company to grow its profits less than 59% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 100, is a buy recommendation for growth and momentum investors. All three operating growth indicators, namely revenue, profit, and capital growth, are showing improvements. This is a good indication of a company with a positive future. That might, at the same time, be the simple reason why profit growth is low. A growing company needs money and thus can't yet show high profit growth. Look out for signs in corporate communication about extra growth efforts costing time and money. If that is the case, Hotai Finance is a good growth stock. ...read more
Safety Strategy: Hotai Finance Debt Financing Safety above-average
| SAFETY METRICS | January 16, 2025 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 17 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 57 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 98 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 71 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 71 (better than 71% compared with alternatives), the company Hotai Finance 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 Hotai Finance 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 Hotai Finance. Refinancing is at 57, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 57% of its competitors. Liquidity is also good at 98, meaning the company generates more profit to service its debt than 98% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 17, which means the company has an above-average debt-to-equity ratio. It has more debt than 83% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 71 (better than 71% compared with alternatives), Hotai Finance has a financing structure that is safer 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 Hotai Finance 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: Hotai Finance Top Financial Performance
| COMBINED PERFORMANCE | January 16, 2025 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 21 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 100 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 98 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 84 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 84 (better than 84% compared with investment alternatives), Hotai Finance (Consumer Finance, Taiwan) shares have much better financial characteristics than comparable stocks. Shares of Hotai Finance are low in value (priced high) with a consolidated Value Rank of 21 (worse than 79% of alternatives). But they show above-average growth (Growth Rank of 100) and are safely financed (Safety Rank of 71, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 84, is a strong buy recommendation based on Hotai Finance's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Hotai Finance exhibits low value (Obermatt Value Rank of 21), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 100). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 71) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.