October 24, 2024
Top 10 Stock Kellanova Hold 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: Kellanova – Top 10 Stock in S&P 500 Consumer Staples Index
Kellanova is listed as a top 10 stock on October 24, 2024 in the market index S&P US Consumer because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. The company is growing above average and professional investor sentiment is positive. Both are encouraging signals for a stock purchase decision, albeit at an above-average share price. Based on the Obermatt 360° View of 31 (31% performer), Obermatt assesses an overall hold recommendation for Kellanova on October 24, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Packaged Foods & Meats |
| Index | Dividends USA, Energy Efficient, S&P US Consumer, S&P US Food & Beverage, S&P 500 |
| 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 Kellanova Hold
| 360 METRICS | October 24, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 21 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 53 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 10 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 85 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 31 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 31 (better than 31% compared with alternatives), overall professional sentiment and financial characteristics for the stock Kellanova are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Kellanova. The consolidated Growth Rank has a good rank of 53, 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. This means that growth is higher than for 53% of competitors in the same industry. The consolidated Sentiment Rank also has a good rank of 85, which means that professional investors are more optimistic about the stock than for 85% of alternative investment opportunities. But the consolidated Value Rank has a less desirable rank of 21, which means that the share price of Kellanova is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 79% of alternative stocks in the same industry. Finally, the consolidated Safety Rank has a riskier rank of 10, which means that the company has a financing structure that is riskier than those of 90% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. ...read more
RECOMMENDATION: With a consolidated 360° View of 31, Kellanova is worse than 69% of all alternative stock investment opportunities based on the Obermatt Method. Only half of the consolidated Obermatt Ranks exhibit excellent performance, so one needs to take a close look. Growth is above-average (Growth Rank of 53), and professional market sentiment is positive (Sentiment Rank of 85), but value and safety are below average. The Safety Rank is the least significant of the four consolidated ranks, because it only reflects financing practices. In the case of high growth, aggressive financing is a good thing. So the question is: How to assess below-average value against above-average growth and sentiment? Growth may be the strongest driver of the investment rationale in this case, which is reflected in institutional investors' opinions. It is typical for growth companies to have low value, as is the case here. Investors are willing to pay more for companies that outperform their competitors. So the question is, how much do you sacrifice value for growth? You can use the following rule of thumb: If you take 100 minus the growth rank, you arrive at a possibly minimum level for the value rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value if the growth rank is above 60. Sometimes market sentiment just extrapolates the past, but sometimes it reflects reality. You pay more than the market average for this stock, but it may be worth it. ...read more
Sentiment Strategy: Professional Market Sentiment for Kellanova very positive
ANALYSIS: With an Obermatt Sentiment Rank of 85 (better than 85% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Kellanova is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Kellanova. Analyst Opinions are at a rank of 19 (worse than 81% 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 indicates a shift in stock research experts opinions for the better. In other words, they are getting more optimistic about stock investments in Kellanova. Even better, the Professional Investors rank is 90, meaning that professional investors hold more stock in this company than in 90% of alternative investment opportunities. Pros tend to favor investing in this company. Furthermore, Market Pulse has a rank of 94, which means that the current professional news and professional social networks are upbeat when discussing this company (more positive news than for 94% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 85 (more positive than 85% compared with investment alternatives), Kellanova has a reputation among professional investors that is significantly higher than that of its competitors. While analysts are still critical of the company, some are changing their minds. In addition, the professional news channels are optimistic, and many institutional investors have already bought stock in the company. These are encouraging signals, despite the still lower level of analyst recommendations. They may be due to a problematic past, and about to change. The positive sentiment signals are stronger than the negative. ...read more
Value Strategy: Kellanova Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 21 (worse than 79% compared with alternatives), Kellanova shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Kellanova. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 62% 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 31 which means that the stock price compared with what market professionals expect for future profits is higher than 69% of comparable companies, indicating a low value concerning Kellanova's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 24 which means that the stock price compared with what market professionals expect for future profit levels is higher than 76% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 16 is also low. Compared with invested capital, the stock price is higher than for 84% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 21, is a sell recommendation based on Kellanova's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Kellanova? 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 Kellanova only if they reasonably expect the low current profit levels to be transitory. ...read more
Growth Strategy: Kellanova Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 53 (better than 53% compared with alternatives), Kellanova 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 three out of four indicators below average for Kellanova. Sales Growth has a below market rank of 49, which means that, currently, professionals expect the company to grow less than 51% of its competitors. The same is valid for Capital Growth, with a rank of 21, and Profit Growth, with a rank of 32. Currently, professionals expect the company to grow its profits less than 68% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 91, which means that the stock returns have recently been above 91% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 53, is a buy recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for Kellanova, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with recent above-market stock returns. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive stock returns are not yet a sign of recovery. Investors should look closely at the Value and Sentiment indicators before they make a stock purchasing decision, because growth is unlikely to be the driving argument behind this investment. ...read more
Safety Strategy: Kellanova Debt Financing Safety risky
| SAFETY METRICS | October 24, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 14 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 15 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 47 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 10 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 10 (better than 10% compared with alternatives), the company Kellanova 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 Kellanova 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 Kellanova. Liquidity is at 47, meaning that the company generates less profit to service its debt than 53% 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 14, meaning the company has an above-average debt-to-equity ratio. It has more debt than 86% of its competitors. Finally, Refinancing is at a rank of 15 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 85% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 10 (worse than 90% compared with alternatives), Kellanova 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: Kellanova Lowest Financial Performance
| COMBINED PERFORMANCE | October 24, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 21 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 53 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 47 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 6 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 6 (worse than 94% compared with investment alternatives), Kellanova (Packaged Foods & Meats, USA) shares have lower financial characteristics compared with similar stocks. Shares of Kellanova are low in value (priced high) with a consolidated Value Rank of 21 (worse than 79% of alternatives), and are riskily financed (Safety Rank of 10, which means above-average debt burdens) but show above-average growth (Growth Rank of 53). ...read more
RECOMMENDATION: A Combined Rank of 6, is a sell recommendation based on Kellanova's financial characteristics. As the company Kellanova shows low value with an Obermatt Value Rank of 21 (79% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 53% of comparable companies (Obermatt Growth Rank is 53). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 10 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Kellanova, even a low-value company (in terms of its key financial indicators) can be a good investment. ...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.