March 21, 2024
Top 10 Stock Italgas 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: Italgas – Top 10 Stock in Milano Italia Borsa Index MIB
Italgas is listed as a top 10 stock on March 21, 2024 in the market index MIB because of its high performance in at least one of the Obermatt investment strategies. As three out of four consolidated Obermatt Ranks exhibit excellent performance, it is a solid investment where the risk of paying too much for the shares is low, despite a currently slow growth momentum. Based on the Obermatt 360° View of 73 (high 73% performer), Obermatt assesses an overall buy recommendation for Italgas on March 21, 2024.
Snapshot: Obermatt Ranks
| Country | Italy |
| Industry | Gas Utilities |
| Index | MIB, Dividends Europe |
| 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 Italgas Buy
| 360 METRICS | March 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 72 |
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| GROWTH | ||||||||
| GROWTH | 41 |
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| SAFETY | ||||||||
| SAFETY | 61 |
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| SENTIMENT | ||||||||
| SENTIMENT | 72 |
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| 360° VIEW | ||||||||
| 360° VIEW | 73 |
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ANALYSIS: With an Obermatt 360° View of 73 (better than 73% compared with alternatives), overall professional sentiment and financial characteristics for the stock Italgas are above average. The 360° View is based on consolidating four consolidated indicators, with half of the indicators below and half above average for Italgas. The consolidated Value Rank has an attractive rank of 72, which means that the share price of Italgas is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 72% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 61. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 72. But the consolidated Growth Rank has a low rank of 41, which means that the company is below average in terms of growth and momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. 59 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 73, Italgas is better positioned than 73% of all alternative stock investment opportunities based on the Obermatt Method. Three out of four consolidated Obermatt Ranks show above-average performance. The stock has as good value (Value Rank of 72), secure financing practices (Safety Rank of 61), and positive market sentiment in the professional investor community (Sentiment Rank of 72). 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. The company’s growth expectations are below the industry average (Growth Rank of 41), but that could also be temporary since professional investors remain optimistic despite the low growth numbers. The low price as reflected in the good Value Rank could indicate that the company's future is challenging. The below-par growth performance may be the reason for this. Companies that grow less are typically cheaper than fast-growing competitors. We recommend evaluating whether the future of Italgas is as difficult as the stock’s low price suggests, despite the positive professional investor sentiment. Since the professional community is optimistic, you might have less to worry about, and the stock may just go through a more challenging phase now, indicating good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for Italgas positive
ANALYSIS: With an Obermatt Sentiment Rank of 72 (better than 72% compared with alternatives), overall professional sentiment and engagement for the stock Italgas is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Italgas. Analyst Opinions are at a rank of 47 (worse than 53% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 45, which means that stock research experts are getting even more pessimistic. Other sentiment indicators are positive: The Professional Investors rank is 94, which means that professional investors hold more stock in this company than in 94% of alternative investment opportunities. So, pros tend to favor investing in this company. In addition, Market Pulse has a rank of 59, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 59% of competitors). While stock research analysts are getting ever more critical, many professional investors are committed to Italgas and the professional news channels are on the positive side. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 72 (more positive than 72% compared with investment alternatives), Italgas has a reputation among professional investors that is above-average compared with that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical, while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: Italgas Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 72 (better than 72% compared with alternatives), Italgas 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 Italgas. Price-to-Profit (also referred to as price to earnings, P/E ratio) is 78 which means that the stock price compared with what market professionals expect for future profits is lower than for 78% of comparable companies, indicating a good value concerning Italgas's profit levels. The same is valid for the expected Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 50, and for Dividend Yield with a Dividend Yield Rank of 86. But, compared with other companies in the same industry, the stock price is higher than average as regards expected revenues; only 72% of all competitors have an even higher stock price as regards to sales revenues (a Price-to-Sales Rank of 28). Profits, the level of invested capital, and dividend policy suggest that this stock is attractively priced. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 72, is a buy recommendation based on Italgas's stock price compared with the company's operational size and dividend yields. Since it is on the expensive side for Price-to-Sales, it may mean that Italgas has pricing power in its distribution market because it can charge higher prices than its competitors. If this is the case, all four value indicators are positive signals for purchasing Italgas shares. ...read more
Growth Strategy: Italgas Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 41 (better than 41% compared with alternatives), Italgas shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Italgas. Sales Growth has a rank of 64 which means that currently, professionals expect the company to grow more than 64% of its competitors. Both Profit Growth, with a rank of 56, and Stock Returns, with a rank of 56, are also above average. But Capital Growth only has a rank of 20, which means that, currently, professionals expect the company to grow its invested capital less than 80% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 41, is a hold 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: Italgas Debt Financing Safety above-average
| SAFETY METRICS | March 21, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 9 |
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| REFINANCING | ||||||||
| REFINANCING | 63 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 86 |
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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 Italgas 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 Italgas 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 Italgas. Refinancing is at 63, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 63% of its competitors. Liquidity is also good at 86, meaning the company generates more profit to service its debt than 86% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 9, which means the company has an above-average debt-to-equity ratio. It has more debt than 91% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 61 (better than 61% compared with alternatives), Italgas 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 Italgas 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: Italgas Above-Average Financial Performance
| COMBINED PERFORMANCE | March 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 72 |
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| GROWTH | ||||||||
| GROWTH | 41 |
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| SAFETY | ||||||||
| SAFETY | 86 |
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| COMBINED | ||||||||
| COMBINED | 69 |
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ANALYSIS: With an Obermatt Combined Rank of 69 (better than 69% compared with investment alternatives), Italgas (Gas Utilities, Italy) shares have above-average financial characteristics compared with similar stocks. Shares of Italgas are a good value (attractively priced) with a consolidated Value Rank of 72 (better than 72% of alternatives), are safely financed (Safety Rank of 61, which means low debt burdens), but show below-average growth (Growth Rank of 41). ...read more
RECOMMENDATION: A Combined Rank of 69, is a buy recommendation based on Italgas's financial characteristics. As the company Italgas's key financial metrics exhibit good value (Obermatt Value Rank of 72) but low growth (Obermatt Growth Rank of 41) while being safely financed (Obermatt Safety Rank of 61), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 72% 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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