Fact based stock research
Lotus Pharmaceutical (TSEC:1795)

TW0001795003

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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.

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Lotus Pharmaceutical stock research in summary

lotuspharm.com.tw

ANALYSIS: With an Obermatt Combined Rank of 16 (worse than 84% compared with investment alternatives), Lotus Pharmaceutical (Pharmaceuticals, Taiwan) shares have lower financial characteristics compared with similar stocks. Shares of Lotus Pharmaceutical are low in value (priced high) with a consolidated Value Rank of 38 (worse than 62% of alternatives), and are riskily financed (Safety Rank of 16, which means above-average debt burdens) but show above-average growth (Growth Rank of 56). ...read more

RECOMMENDATION: A Combined Rank of 16, is a sell recommendation based on Lotus Pharmaceutical's financial characteristics. As the company Lotus Pharmaceutical shows low value with an Obermatt Value Rank of 38 (62% 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 56% of comparable companies (Obermatt Growth Rank is 56). 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 16 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 Lotus Pharmaceutical, even a low-value company (in terms of its key financial indicators) can be a good investment. 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	38
Growth Rank	56
Safety Rank	16
Combined Rank	16

Country	Taiwan
Industry	Pharmaceuticals
Index	FTSE Taiwan
Size class	Medium

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

Further information

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

Research History: Lotus Pharmaceutical

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	76	65	38	38
GROWTH
GROWTH	87	85	87	56
SAFETY
SAFETY	54	18	18	16
SENTIMENT
SENTIMENT	n/a	69	90	^new
360° VIEW
360° VIEW	n/a	79	70	^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 Lotus Pharmaceutical is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	76	65	38	38
GROWTH
GROWTH	87	85	87	56
SAFETY
SAFETY	54	18	18	16
COMBINED
COMBINED	89	57	42	16

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

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 38 (worse than 62% compared with alternatives), Lotus Pharmaceutical shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Lotus Pharmaceutical. Price-to-Profit (also referred to as price-earnings, P/E) is 78 which means that the stock price compared with what market professionals expect for future profits is lower than for 78% of comparable companies, indicating a good value concerning Lotus Pharmaceutical's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 24, which means that the stock price is lower as regards to invested capital than for 24% of comparable investments. On the other hand, Price-to-Sales is less favorable than 75% of alternatives (only 25% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 27% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 38, is a hold recommendation based on Lotus Pharmaceutical's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. 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 especially important 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)	77	69	24	25
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	78	91	65	78
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	46	47	18	24
DIVIDEND YIELD
DIVIDEND YIELD	54	62	64	73
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	76	65	38	38

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

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 56 (better than 56% compared with alternatives), Lotus Pharmaceutical 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 Lotus Pharmaceutical. While Sales Growth ranks at 89, professionals currently expect the company to grow more than 89% of its competitors, while all other growth ranks are below the market median. Profit Growth has a rank of 43, which means that, currently, professionals expect the company to grow its profits less than 57% of its competitors, and Capital Growth has a low rank of 43. Historic stock returns were also below average with a current Stock Returns rank of 46 which means that the stock returns have recently been below 54% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 56, is a buy recommendation for growth and momentum investors. If revenues are expected to increase, but all other growth indicators are negative, the company may be investing in future growth through means not visible in the balance sheet and thus not reflected in capital growth. The fact that Stock Returns have been below market doesn't mean that much, as it may be due to overly optimistic investor behavior in the past, which has been corrected to a more reasonable level recently. If that were the case, a positive Value Rank would be a reason to invest because the company is still expected to grow, while stock prices are now at a more reasonable level. 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 isn't stellar here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	71	67	82	89
PROFIT GROWTH
PROFIT GROWTH	n/a	76	69	43
CAPITAL GROWTH
CAPITAL GROWTH	n/a	25	51	43
STOCK RETURNS
STOCK RETURNS	75	89	71	46
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	87	85	87	56

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

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 16 (better than 16% compared with alternatives), the company Lotus Pharmaceutical 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 Lotus Pharmaceutical 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 Lotus Pharmaceutical. Liquidity is at 34, meaning that the company generates less profit to service its debt than 66% 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 11, meaning the company has an above-average debt-to-equity ratio. It has more debt than 89% of its competitors. Finally, Refinancing is at a rank of 34 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 66% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 16 (worse than 84% compared with alternatives), Lotus Pharmaceutical 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. Investors should look at Obermatt’s Value, Growth, and Sentiment Ranks to confirm a very positive outlook or be careful with investing in stocks of Lotus Pharmaceutical because it may suffer significantly in case of future difficulties. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	19	8	11	11
REFINANCING
REFINANCING	79	43	29	34
LIQUIDITY
LIQUIDITY	54	24	39	34
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	54	18	18	16

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Lotus Pharmaceutical 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	95	91	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	4	96	^new
MARKET PULSE
MARKET PULSE	n/a	79	46	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	69	90	^new

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