Fact based stock research
Kainos Group (LSE:KNOS)

GB00BZ0D6727

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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.

Kainos Group stock research in summary

kainos.com

ANALYSIS: With an Obermatt Combined Rank of 81 (better than 81% compared with investment alternatives), Kainos Group (IT Consulting & oth. Services, United Kingdom) shares have much better financial characteristics than comparable stocks. Shares of Kainos Group are low in value (priced high) with a consolidated Value Rank of 47 (worse than 53% of alternatives) and show below-average growth (Growth Rank of 37) but are safely financed (Safety Rank of 98), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 81, is a strong buy recommendation based on Kainos Group's financial characteristics. As the company Kainos Group's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 47) and low growth (Obermatt Growth Rank of 37), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 98) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	47
Growth Rank	37
Safety Rank	98
Combined Rank	81

Country	United Kingdom
Industry	IT Consulting & oth. Services
Index	FTSE All Shares, FTSE 250, FTSE 350
Size class	Medium

This stock has achievements: Top 10 Stock.

19-Dec-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

Multiple opinions. One number.

Analysts rarely agree on a stock’s future. So, who do you believe? Obermatt translates those collective views into a single Sentiment Rank. That plus the financial ranks give you the ultimate 360° View. Sign up to access them.

Why popular stocks have low ratings

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Kainos Group

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	48	19	31	47
GROWTH
GROWTH	97	65	23	37
SAFETY
SAFETY	50	88	92	98
SENTIMENT
SENTIMENT	n/a	9	53	^new
360° VIEW
360° VIEW	n/a	33	53	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Sep-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Kainos Group is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	48	19	31	47
GROWTH
GROWTH	97	65	23	37
SAFETY
SAFETY	50	88	92	98
COMBINED
COMBINED	73	60	40	81

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Kainos Group the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 47 (worse than 53% compared with alternatives), Kainos Group shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Kainos Group. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 77% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 40 which means that the stock price compared with what market professionals expect for future profits is higher than 60% of comparable companies, indicating a low value concerning Kainos Group's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 49 which means that the stock price compared with what market professionals expect for future profit levels is higher than 51% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 12 is also low. Compared with invested capital, the stock price is higher than for 88% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 47, is a hold recommendation based on Kainos Group's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Kainos Group? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose Kainos Group only if they reasonably expect the low current profit levels to be transitory. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	27	24	25	40
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	62	31	34	49
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	2	4	14	12
DIVIDEND YIELD
DIVIDEND YIELD	83	67	72	77
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	48	19	31	47

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Kainos Group; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 37 (better than 37% compared with alternatives), Kainos Group 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 three out of four indicators below average for Kainos Group. Only Capital Growth has a good rank of 94, which means that currently professionals expect the company to grow its invested capital more than 16% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 42 which means that currently professionals expect the company to grow less than 58% of its competitors. Profit Growth with a rank of 16 and Stock Returns with a rank of 17 are also low (below 83% of alternative investments). ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 37, is a hold recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Kainos Group is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is limited here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	82	43	48	42
PROFIT GROWTH
PROFIT GROWTH	33	22	44	16
CAPITAL GROWTH
CAPITAL GROWTH	n/a	70	19	94
STOCK RETURNS
STOCK RETURNS	94	89	19	17
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	97	65	23	37

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Kainos Group.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 98 (better than 98% compared with alternatives) for 2024, the company Kainos Group has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Kainos Group 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, where all three are above average for Kainos Group. Leverage is at 84, meaning the company has a below-average debt-to-equity ratio. It has less debt than 84% of its competitors. Refinancing is at a rank of 65, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 65% of its competitors. Finally, Liquidity is also good at a rank of 98, which means that the company generates more profit to service its debt than 98% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 98 (better than 98% compared with alternatives), Kainos Group has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. Investors may not have a debt issue with Kainos Group but they should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	54	81	84	84
REFINANCING
REFINANCING	33	27	45	65
LIQUIDITY
LIQUIDITY	69	100	100	98
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	50	88	92	98

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Kainos Group and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	21	31	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	23	34	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	40	80	^new
MARKET PULSE
MARKET PULSE	n/a	54	62	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	9	53	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Kainos Group.
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