April 11, 2024
Top 10 Stock LIXIL Group Sell 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: LIXIL Group – Top 10 Stock in Water Technology
LIXIL Group is listed as a top 10 stock on April 11, 2024 in the market index Water Tech because of its high performance in at least one of the Obermatt investment strategies. Only the Obermatt Value Rank exhibits above-average performance, which means that the stock is seen as critical by the professional community and other financial facts are below average, conveying mixed investment signals. Based on the Obermatt 360° View of 8 (8% performer), Obermatt issues an overall sell recommendation for LIXIL Group on April 11, 2024.
Snapshot: Obermatt Ranks
| Country | Japan |
| Industry | Building Products |
| Index | Water Tech |
| 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 LIXIL Group Sell
| 360 METRICS | April 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 83 |
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| GROWTH | ||||||||
| GROWTH | 7 |
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| SAFETY | ||||||||
| SAFETY | 15 |
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| SENTIMENT | ||||||||
| SENTIMENT | 6 |
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| 360° VIEW | ||||||||
| 360° VIEW | 8 |
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ANALYSIS: With an Obermatt 360° View of 8 (better than 8% compared with alternatives), overall professional sentiment and financial characteristics for the stock LIXIL Group are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for LIXIL Group. Only the consolidated Value Rank has an attractive rank of 83, which means that the share price of LIXIL Group is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 83% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 7, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. The consolidated Safety Rank has a riskier rank of 15, meaning the company has a riskier financing structure than 85% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, professionals are more pessimistic about the stock than for 94% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 6. ...read more
RECOMMENDATION: With a consolidated 360° View of 8, LIXIL Group is worse than 92% of all alternative stock investment opportunities based on the Obermatt Method. This means that LIXIL Group shares are on the riskier side for investors. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 83. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 7), a riskier financing structure than the competition (Safety Rank of 15), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 6) is negative. This combination is sensitive to a crisis, because high debt levels (low safety) require growth to finance the debt burden. It’s no wonder that the investor community indicators are skeptical (low sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. We recommend evaluating whether the future of LIXIL Group is as challenging as the low price of the stock suggests. Since the professional community is pessimistic, you might need to worry about the future of LIXIL Group. Only invest if you have solid reasons to believe that the low growth is temporary and the current market sentiment is an overreaction, possibly due to reputational issues in the past. ...read more
Sentiment Strategy: Professional Market Sentiment for LIXIL Group negative
ANALYSIS: With an Obermatt Sentiment Rank of 6 (better than 6% compared with alternatives), overall professional sentiment and engagement for the stock LIXIL Group is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for LIXIL Group. Analyst Opinions are at a rank of 26 (worse than 74% 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 37 which means that stock research experts are getting even more pessimistic. It doesn't end with the analysts. Market Pulse is also low with a rank of 27, 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 73% of competitors). No wonder, the Professional Investors rank is only 24, which means that professional investors hold less stock in this company than in 76% of alternative investment opportunities. Pros tend to stay away from LIXIL Group, which may be due to a small company size but just as likely because of its relatively low Sentiment Rank. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 6 (less encouraging than 94% compared with investment alternatives), LIXIL Group has a reputation among professional investors that is far below that of its competitors. Investors should be careful with this stock right now. Further research is required if an investment is desired, because the facts found in the professional community are all negative. ...read more
Value Strategy: LIXIL Group Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 83 (better than 83% compared with alternatives) for 2024, LIXIL Group shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, where three out of four indicators are above average for LIXIL Group. Price-to-Sales (P/S) is 87 which means that the stock price compared with what market professionals expect for future sales is lower than for 87% of comparable companies, indicating a good value for LIXIL Group's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 76. Finally, compared with other companies in the same industry, dividend yields of LIXIL Group are expected to be higher than for 98% of all competitors (a Dividend Yield rank of 98). The only low rank is for expected profits with a Price-to-Profit Rank of 34, indicating that the market expects the company's profit to be low despite a high dividend. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 83, is a buy recommendation based on LIXIL Group's stock price compared with the company's operational size and dividend yields. The low Profit Rank could result from a one-off charge, for instance, for an accident, a legal settlement, or a restructuring project. If the company keeps its dividends high, the low expected profit may be transitory. If that is the case, the three good value ranks for Sales, Capital, and Dividends are reliable indicators for good stock price value, a low stock price. ...read more
Growth Strategy: LIXIL Group Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 7 (better than 7% compared with alternatives), LIXIL Group 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 all four metrics below average for LIXIL Group. Sales Growth has a rank of 12, which means that currently professionals expect the company to grow less than 88% of its competitors. The same is valid for Profit Growth, with a rank of 9, and Capital Growth with 45. In addition, Stock Returns have a below market rank of 19, which means that the stock returns have recently been below 81% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 7, is a sell recommendation for growth and momentum investors. These are all bad growth momentum indicators. These are negative signals for investors interested in growth companies. Value is likely good for this company, as investors may have left this stock in the cold. If that is the case, investors should look at the company's outlook, especially Sentiment performance, because it may be a turnaround situation that could entail above-average stock returns in the future. But it remains a risky bet, as no growth signals are in the green zone yet. ...read more
Safety Strategy: LIXIL Group Debt Financing Safety risky
| SAFETY METRICS | April 11, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 18 |
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| REFINANCING | ||||||||
| REFINANCING | 33 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 31 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 15 |
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ANALYSIS: With an Obermatt Safety Rank of 15 (better than 15% compared with alternatives), the company LIXIL Group 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 LIXIL Group 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 LIXIL Group. Liquidity is at 31, meaning that the company generates less profit to service its debt than 69% 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 18, meaning the company has an above-average debt-to-equity ratio. It has more debt than 82% of its competitors. Finally, Refinancing is at a rank of 33 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 67% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 15 (worse than 85% compared with alternatives), LIXIL Group 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: LIXIL Group Lowest Financial Performance
| COMBINED PERFORMANCE | April 11, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 83 |
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| GROWTH | ||||||||
| GROWTH | 7 |
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| SAFETY | ||||||||
| SAFETY | 31 |
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| COMBINED | ||||||||
| COMBINED | 19 |
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ANALYSIS: With an Obermatt Combined Rank of 19 (worse than 81% compared with investment alternatives), LIXIL Group (Building Products, Japan) shares have lower financial characteristics compared with similar stocks. Shares of LIXIL Group are a good value (attractively priced) with a consolidated Value Rank of 83 (better than 83% of alternatives) but show below-average growth (Growth Rank of 7), and are riskily financed (Safety Rank of 15), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 19, is a sell recommendation based on LIXIL Group's financial characteristics. As the company LIXIL Group's key financial metrics exhibit good value (Obermatt Value Rank of 83) but low growth (Obermatt Growth Rank of 7) and risky financing practices (Obermatt Safety Rank of 15), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 83% of comparable companies, may indicate 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. ...read more
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