March 28, 2024
Top 10 Stock Itau Unibanco 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: Itau Unibanco – Top 10 Stock in Bolsa de Valores-Mercadorias | BOVESPA
Itau Unibanco is listed as a top 10 stock on March 28, 2024 in the market index BOVESPA 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 61 (high 61% performer), Obermatt assesses an overall buy recommendation for Itau Unibanco on March 28, 2024.
Snapshot: Obermatt Ranks
| Country | Brazil |
| Industry | Diversified Banks |
| Index | BOVESPA, Human Rights, Independent Boards Growth Markets |
| Size class | XX-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 Itau Unibanco Buy
| 360 METRICS | March 28, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 71 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 79 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 15 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 47 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 61 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 61 (better than 61% compared with alternatives), overall professional sentiment and financial characteristics for the stock Itau Unibanco are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Itau Unibanco. The consolidated Value Rank has an attractive rank of 71, which means that the share price of Itau Unibanco 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 71% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 79, 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 47. Professional investors are more confident in 53% other stocks. Worryingly, the company has risky financing, with a Safety rank of 15. This means 85% of comparable companies have a safer financing structure than Itau Unibanco. ...read more
RECOMMENDATION: With a consolidated 360° View of 61, Itau Unibanco is better positioned than 61% 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 71 and the Growth Rank above-average at 79, the picture is still mixed. The professional investor community is skeptical, with the Sentiment Rank below-average at 47. In addition, the company financing structure is on the riskier side (Safety Rank of 15). 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 Itau Unibanco only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 47 (better than 47% compared with alternatives), overall professional sentiment and engagement for the stock Itau Unibanco 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 Itau Unibanco. 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. But they are changing their opinions! Analyst Opinions Change has a rank of 60, 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 Itau Unibanco. More encouragingly, the Professional Investors rank is 59, which means that professional investors hold more stock in this company than in 59% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 24, 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 76% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 47 (less encouraging than 53% compared with investment alternatives), Itau Unibanco has a reputation among professional investors that is below that of its competitors. The sentiment signals are mixed for Itau Unibanco. 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: Itau Unibanco Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 71 (better than 71% compared with alternatives), Itau Unibanco 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 Itau Unibanco. Price-to-Sales (P/S) is 72, which means that the stock price compared with what market professionals expect for future sales is lower than for 72% of comparable companies, indicating a good value concerning Itau Unibanco's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 67% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 92 (dividends are expected to be higher than 92% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 60% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Itau Unibanco to 40. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 71, is a buy recommendation based on Itau Unibanco's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner in assets than its competitors. For instance, the company could be leasing its production facilities or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the three good value ranks for Sales, Profits, and Dividends are reliable indicators for the stock price value. ...read more
Growth Strategy: Itau Unibanco Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 79 (better than 79% compared with alternatives) for 2024, Itau Unibanco 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 Itau Unibanco. Profit Growth has a rank of 71 which means that currently professionals expect the company to grow its profits more than 71% of its competitors. The same is valid for capital growth and stock returns. Capital Growth has a rank of 99, and Stock Returns has a rank of 85 which means that the stock returns have recently been above 85% of alternative investments. Only revenue growth is low with a Sales Growth has a rank of 31 (69% of its competitors are better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 79, 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: Itau Unibanco Debt Financing Safety risky
| SAFETY METRICS | March 28, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 8 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 42 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 45 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 15 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 15 (better than 15% compared with alternatives), the company Itau Unibanco 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 Itau Unibanco 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 Itau Unibanco. Liquidity is at 45, meaning that the company generates less profit to service its debt than 55% 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 8, meaning the company has an above-average debt-to-equity ratio. It has more debt than 92% of its competitors. Finally, Refinancing is at a rank of 42 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 58% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 15 (worse than 85% compared with alternatives), Itau Unibanco 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: Itau Unibanco Above-Average Financial Performance
| COMBINED PERFORMANCE | March 28, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 71 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 79 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 45 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 69 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 69 (better than 69% compared with investment alternatives), Itau Unibanco (Diversified Banks, Brazil) shares have above-average financial characteristics compared with similar stocks. Shares of Itau Unibanco are a good value (attractively priced) with a consolidated Value Rank of 71 (better than 71% of alternatives), show above-average growth (Growth Rank of 79) but are riskily financed (Safety Rank of 15), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 69, is a buy recommendation based on Itau Unibanco's financial characteristics. As the company Itau Unibanco's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 71) and above-average growth (Obermatt Growth Rank of 79), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 15) 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.