November 21, 2024
Top 10 Stock KAP Industrial 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: KAP Industrial – Top 10 Stock in Johannesburg Securities Exchange All Shares Index JSE All Shares
KAP Industrial is listed as a top 10 stock on November 21, 2024 in the market index JSE All Shares 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 63 (high 63% performer), Obermatt assesses an overall buy recommendation for KAP Industrial on November 21, 2024.
Snapshot: Obermatt Ranks
| Country | South Africa |
| Industry | Industrial Conglomerates |
| Index | Good Governace Growth Markets, Independent Boards Growth Markets, JSE All Shares |
| 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 KAP Industrial Buy
| 360 METRICS | November 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 99 |
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| GROWTH | ||||||||
| GROWTH | 57 |
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| SAFETY | ||||||||
| SAFETY | 34 |
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| SENTIMENT | ||||||||
| SENTIMENT | 32 |
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| 360° VIEW | ||||||||
| 360° VIEW | 63 |
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ANALYSIS: With an Obermatt 360° View of 63 (better than 63% compared with alternatives), overall professional sentiment and financial characteristics for the stock KAP Industrial are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for KAP Industrial. The consolidated Value Rank has an attractive rank of 99, which means that the share price of KAP Industrial 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 99% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 57, 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 32. Professional investors are more confident in 68% other stocks. Worryingly, the company has risky financing, with a Safety rank of 34. This means 66% of comparable companies have a safer financing structure than KAP Industrial. ...read more
RECOMMENDATION: With a consolidated 360° View of 63, KAP Industrial is better positioned than 63% 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 99 and the Growth Rank above-average at 57, the picture is still mixed. The professional investor community is skeptical, with the Sentiment Rank below-average at 32. In addition, the company financing structure is on the riskier side (Safety Rank of 34). 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 KAP Industrial only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 32 (better than 32% compared with alternatives), overall professional sentiment and engagement for the stock KAP Industrial 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 KAP Industrial. Analyst Opinions are at a rank of 37 (worse than 63% 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 KAP Industrial. More encouragingly, the Professional Investors rank is 69, which means that professional investors hold more stock in this company than in 69% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 7, 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 93% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 32 (less encouraging than 68% compared with investment alternatives), KAP Industrial has a reputation among professional investors that is below that of its competitors. The sentiment signals are mixed for KAP Industrial. 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: KAP Industrial Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 99 (better than 99% compared with alternatives) for 2024, KAP Industrial shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for KAP Industrial. Price-to-Sales is 91 which means that the stock price compared with what market professionals expect for future sales is lower than for 91% of comparable companies, indicating a good value for KAP Industrial's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 85% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 92. Compared with other companies in the same industry, dividend yields of KAP Industrial are expected to be higher than for 98% of all competitors (a Dividend Yield rank of 98). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 99, is a buy recommendation based on KAP Industrial's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in KAP Industrial based on its detailed value metrics.
Growth Strategy: KAP Industrial Growth Momentum good
| GROWTH METRICS | November 21, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 23 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 62 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 73 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 51 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 57 |
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ANALYSIS: With an Obermatt Growth Rank of 57 (better than 57% compared with alternatives), KAP Industrial 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 KAP Industrial. Profit Growth has a rank of 62 which means that currently professionals expect the company to grow its profits more than 62% of its competitors. The same is valid for capital growth and stock returns. Capital Growth has a rank of 73, and Stock Returns has a rank of 51 which means that the stock returns have recently been above 51% of alternative investments. Only revenue growth is low with a Sales Growth has a rank of 23 (77% of its competitors are better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 57, 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: KAP Industrial Debt Financing Safety below-average
| SAFETY METRICS | November 21, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 32 |
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| REFINANCING | ||||||||
| REFINANCING | 63 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 31 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 34 |
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ANALYSIS: With an Obermatt Safety Rank of 34 (better than 34% compared with alternatives), the company KAP Industrial has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of KAP Industrial 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 just one indicator above average for KAP Industrial and the other two below average. Refinancing is at 63, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 63% of its competitors. But Leverage is high with a rank of 32, meaning the company has an above-average debt-to-equity ratio. It has more debt than 68% of its competitors. Liquidity is also on the riskier side with a rank of 31, meaning the company generates less profit to service its debt than 69% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 34 (worse than 66% compared with alternatives), KAP Industrial has a financing structure that is riskier than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for KAP Industrial are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making an investment decision. ...read more
Combined financial peformance: KAP Industrial Top Financial Performance
| COMBINED PERFORMANCE | November 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 99 |
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| GROWTH | ||||||||
| GROWTH | 57 |
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| SAFETY | ||||||||
| SAFETY | 31 |
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| COMBINED | ||||||||
| COMBINED | 82 |
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ANALYSIS: With an Obermatt Combined Rank of 82 (better than 82% compared with investment alternatives), KAP Industrial (Industrial Conglomerates, South Africa) shares have much better financial characteristics than comparable stocks. Shares of KAP Industrial are a good value (attractively priced) with a consolidated Value Rank of 99 (better than 99% of alternatives), show above-average growth (Growth Rank of 57) but are riskily financed (Safety Rank of 34), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 82, is a strong buy recommendation based on KAP Industrial's financial characteristics. As the company KAP Industrial's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 99) and above-average growth (Obermatt Growth Rank of 57), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 34) 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
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