May 16, 2024
Top 10 Stock LSIS 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: LSIS – Top 10 Stock in Korea Composite Stock Price Index KOSPI
LSIS is listed as a top 10 stock on May 16, 2024 in the market index KOSPI 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 74 (high 74% performer), Obermatt assesses an overall buy recommendation for LSIS on May 16, 2024.
Snapshot: Obermatt Ranks
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 LSIS Buy
| 360 METRICS | May 16, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 22 |
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| GROWTH | ||||||||
| GROWTH | 91 |
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| SAFETY | ||||||||
| SAFETY | 23 |
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| SENTIMENT | ||||||||
| SENTIMENT | 100 |
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| 360° VIEW | ||||||||
| 360° VIEW | 74 |
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ANALYSIS: With an Obermatt 360° View of 74 (better than 74% compared with alternatives), overall professional sentiment and financial characteristics for the stock LSIS are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for LSIS. The consolidated Growth Rank has a good rank of 91, 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 91% of competitors in the same industry. The consolidated Sentiment Rank also has a good rank of 100, which means that professional investors are more optimistic about the stock than for 100% of alternative investment opportunities. But the consolidated Value Rank has a less desirable rank of 22, which means that the share price of LSIS 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 78% of alternative stocks in the same industry. Finally, the consolidated Safety Rank has a riskier rank of 23, which means that the company has a financing structure that is riskier than those of 77% 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 74, LSIS is better positioned than 74% 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 91), and professional market sentiment is positive (Sentiment Rank of 100), 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 LSIS very positive
ANALYSIS: With an Obermatt Sentiment Rank of 100 (better than 100% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock LSIS is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all four indicators above average for LSIS. Analyst Opinions are at a rank of 92 (better than 92% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive with a rank of 82, which means that stock research experts are changing their opinions for the better and recommending investing in the company. They are getting more optimistic about stock investments in LSIS. The Professional Investors rank is 96, which means that currently, professional investors hold more stock in this company than in 96% of alternative investment opportunities. Pros tend to favor investing in this company. Finally, Market Pulse has a rank of 72 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 72% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 100 (more positive than 100% compared with investment alternatives), LSIS has a reputation among professional investors that is significantly higher than that of its competitors. Since all market sentiment indicators are positive, the professional community highly recommends investment in the company. Does this mean LSIS stocks are a safe investment? Far from it. Even professionals make mistakes. Especially in stock investing, there is a tendency to follow the leaders. Since trees don't grow to the heavens, such positive sentiment may also be interpreted as a danger sign. A lot of optimism can often be a sign of troubles to come, albeit unforeseen by most. ...read more
Value Strategy: LSIS Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 22 (worse than 78% compared with alternatives), LSIS shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, where the majority of metrics are below, and only one is above average for LSIS. Price-to-Sales (P/S) is 58, which means that the stock price compared with what market professionals expect for future sales is lower than 58% of comparable companies, indicating a good value concerning to LSIS's revenue size. But all other performance indicators point in a different direction. Dividend yields have a Dividend Yield rank of 33, meaning that dividends are expected to be lower than for 67% of comparable investments. Furthermore, Price-to-Book Capital (also referred to as market-to-book ratio) is less favorable than 70% of alternatives (only 30% of peers have an even higher ratio). The same is valid for Price-to-Profit (or Price / Earnings, P/E), which is higher than for 80% of comparable companies, making the stock more expensive compared with the company's expected profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 22, is a sell recommendation based on LSIS's stock price compared with the company's operational size and dividend yields. Since Price-to-Sales is a stable value indicator even in challenging times, investing in LSIS could be seen as a value investment. However, there must be a good reason for the low market-to-book rank. If the company has a typical capital investment practice, the stock may be overvalued because the profit and dividend-related performance indicators are also low. The stock is only good value if investors can expect profits and dividends to pick up in the future. Else, LSIS looks like an expensive investment today. ...read more
Growth Strategy: LSIS Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 91 (better than 91% compared with alternatives) for 2024, LSIS shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for LSIS. Profit Growth has a rank of 64 which means that currently professionals expect the company to grow its profits more than 64% of its competitors. The same is valid for capital growth and stock returns. Capital Growth has a rank of 83, and Stock Returns has a rank of 96 which means that the stock returns have recently been above 96% of alternative investments. Only revenue growth is low with a Sales Growth has a rank of 32 (68% of its competitors are better). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 91, 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: LSIS Debt Financing Safety risky
| SAFETY METRICS | May 16, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 22 |
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| REFINANCING | ||||||||
| REFINANCING | 45 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 36 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 23 |
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ANALYSIS: With an Obermatt Safety Rank of 23 (better than 23% compared with alternatives), the company LSIS 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 LSIS 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 LSIS. Liquidity is at 36, meaning that the company generates less profit to service its debt than 64% 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 22, meaning the company has an above-average debt-to-equity ratio. It has more debt than 78% of its competitors. Finally, Refinancing is at a rank of 45 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 55% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 23 (worse than 77% compared with alternatives), LSIS 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: LSIS Below-Average Financial Performance
| COMBINED PERFORMANCE | May 16, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 22 |
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| GROWTH | ||||||||
| GROWTH | 91 |
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| SAFETY | ||||||||
| SAFETY | 36 |
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| COMBINED | ||||||||
| COMBINED | 34 |
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ANALYSIS: With an Obermatt Combined Rank of 34 (worse than 66% compared with investment alternatives), LSIS (Electr. Components & Equipment, South Korea) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of LSIS are low in value (priced high) with a consolidated Value Rank of 22 (worse than 78% of alternatives), and are riskily financed (Safety Rank of 23, which means above-average debt burdens) but show above-average growth (Growth Rank of 91). ...read more
RECOMMENDATION: A Combined Rank of 34, is a hold recommendation based on LSIS's financial characteristics. As the company LSIS shows low value with an Obermatt Value Rank of 22 (78% 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 91% of comparable companies (Obermatt Growth Rank is 91). 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 23 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 LSIS, even a low-value company (in terms of its key financial indicators) can be a good investment. ...read more
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