December 19, 2024
Top 10 Stock IRESS 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: IRESS – Top 10 Stock in Australian Securities Exchange Index ASX 300
IRESS is listed as a top 10 stock on December 19, 2024 in the market index ASX 300 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 below average and thus a signal for caution. Based on the Obermatt 360° View of 34 (34% performer), Obermatt assesses an overall hold recommendation for IRESS on December 19, 2024.
Snapshot: Obermatt Ranks
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 IRESS Hold
| 360 METRICS | December 19, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 59 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 59 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 19 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 33 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 34 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 34 (better than 34% compared with alternatives), overall professional sentiment and financial characteristics for the stock IRESS are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for IRESS. The consolidated Value Rank has an attractive rank of 59, which means that the share price of IRESS 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 59% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 59, 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. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 33. Professional investors are more confident in 67% other stocks. Worryingly, the company has risky financing, with a Safety rank of 19. This means 81% of comparable companies have a safer financing structure than IRESS. ...read more
RECOMMENDATION: With a consolidated 360° View of 34, IRESS is worse than 66% of all alternative stock investment opportunities based on the Obermatt Method. Even though half of the consolidated Obermatt Ranks are above-average, namely the Value Rank at 59 and the Growth Rank above-average at 59, the picture is still mixed. The professional investor community is skeptical, with the Sentiment Rank below-average at 33. In addition, the company financing structure is on the riskier side (Safety Rank of 19). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. One may be tempted by above-average growth, but that could also change quickly, as past performance is not a good indicator of future performance. Since the financing structure is on the risky side, investors should 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 IRESS only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 33 (better than 33% compared with alternatives), overall professional sentiment and engagement for the stock IRESS 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 IRESS. Analyst Opinions are at a rank of 25 (worse than 75% 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 50, 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 IRESS. More encouragingly, the Professional Investors rank is 50, which means that professional investors hold more stock in this company than in 50% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 28, 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 72% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 33 (less encouraging than 67% compared with investment alternatives), IRESS has a reputation among professional investors that is below that of its competitors. The sentiment signals are mixed for IRESS. 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: IRESS Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 59 (better than 59% compared with alternatives), IRESS shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half above average for IRESS. Price-to-Sales (P/S) is 64, which means that the stock price compared with what market professionals expect for future sales is lower than for 64% of comparable companies, indicating a good value concerning IRESS's revenue size. The same is valid for dividend yields with a Dividend Yield rank of 92, which means that dividends are expected to be higher than for 92% of comparable investments. On the other hand, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is less favorable than for 55% of alternatives (only 45% of peers have an even higher ratio). The same is valid for the Price-to-Profit (or Price / Earnings, P/E) ratio, which is higher than for 75% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 59, is a buy recommendation based on IRESS's stock price compared with the company's operational size and dividend yields. This is a somewhat surprising picture, because it means that profits are low while dividends are high. One interpretation could be that profits are expected to increase, justifying the high dividend payments. But it could also mean that the company desperately keeps the high dividends to avoid a collapsing share price. This would be a rather dangerous constellation. ...read more
Growth Strategy: IRESS Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 59 (better than 59% compared with alternatives), IRESS 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 all but one indicator above average for IRESS. Profit Growth has a rank of 52 which means that currently professionals expect the company to grow its profits more than 52% of its competitors. The same is valid for capital growth and stock returns. Capital Growth has a rank of 96, and Stock Returns has a rank of 53 which means that the stock returns have recently been above 53% of alternative investments. Only revenue growth is low with a Sales Growth has a rank of 1 (99% of its competitors are better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 59, is a buy recommendation for growth and momentum investors. The many positive growth indicators indicate a positive growth momentum with only low revenue growth. That can also be attributed to divestments or the sale of unprofitable businesses. If that is the reason, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: IRESS Debt Financing Safety risky
| SAFETY METRICS | December 19, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 1 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 47 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 29 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 19 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 19 (better than 19% compared with alternatives), the company IRESS has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of IRESS 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 all three metrics below average for IRESS. Liquidity is at 29, meaning that the company generates less profit to service its debt than 71% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 1, meaning the company has an above-average debt-to-equity ratio. It has more debt than 99% of its competitors. Finally, Refinancing is at a rank of 47 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 53% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 19 (worse than 81% compared with alternatives), IRESS has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing.
Combined financial peformance: IRESS Below-Average Financial Performance
| COMBINED PERFORMANCE | December 19, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 59 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 59 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 29 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 40 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 40 (worse than 60% compared with investment alternatives), IRESS (Application Software, Australia) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of IRESS are a good value (attractively priced) with a consolidated Value Rank of 59 (better than 59% of alternatives), show above-average growth (Growth Rank of 59) but are riskily financed (Safety Rank of 19), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 40, is a hold recommendation based on IRESS's financial characteristics. As the company IRESS's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 59) and above-average growth (Obermatt Growth Rank of 59), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 19) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...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.