July 6, 2023
Top 10 Stock Mahindra & Mahindra 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: Mahindra & Mahindra – Top 10 Stock in Nifty 50 India Index CNX Nifty 50
Mahindra & Mahindra is listed as a top 10 stock on July 06, 2023 in the market index CNX Nifty 50 because of its high performance in at least one of the Obermatt investment strategies. While only half of the consolidated Obermatt Ranks exhibit above-average performance, the professional market sentiment is positive and it may be a solid investment proposition, especially if a growth recovery is to be expected soon. Based on the Obermatt 360° View of 70 (high 70% performer), Obermatt assesses an overall buy recommendation for Mahindra & Mahindra on July 06, 2023.
Snapshot: Obermatt Ranks
| Country | India |
| Industry | Automobile Manufacturers |
| Index | BSE Sensex, Electromobility, Good Governace Growth Markets, Human Rights, Independent Boards Growth Markets, Low Waste, R/E Growth Markets, Recycling, CNX Nifty 50 |
| 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 Mahindra & Mahindra Buy
| 360 METRICS | July 6, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 62 |
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| GROWTH | ||||||||
| GROWTH | 29 |
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| SAFETY | ||||||||
| SAFETY | 25 |
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| SENTIMENT | ||||||||
| SENTIMENT | 96 |
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| 360° VIEW | ||||||||
| 360° VIEW | 70 |
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ANALYSIS: With an Obermatt 360° View of 70 (better than 70% compared with alternatives), overall professional sentiment and financial characteristics for the stock Mahindra & Mahindra are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Mahindra & Mahindra. The consolidated Value Rank has an attractive rank of 62, which means that the share price of Mahindra & Mahindra is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 62% of alternative stocks in the same industry. The consolidated Sentiment Rank has a good rank of 96, which means that professional investors are more optimistic about the stock than for 96% of alternative investment opportunities. But the consolidated Growth Rank has a low rank of 29, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. The consolidated Safety Rank has a riskier rank of 25, meaning the company has a riskier financing structure than 75 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 70, Mahindra & Mahindra is better positioned than 70% of all alternative stock investment opportunities based on the Obermatt Method. Half of the consolidated Obermatt Ranks exhibit above-average performance, but the other half are below market levels. The company enjoys a good value (Value Rank of 62) and positive market sentiment in the professional investor community (Sentiment Rank of 96), but growth expectations are below-average (Growth Rank of 29) and the financing structure is on the risky side(Safety Rank of 25). This combination is rather dangerous, because high debt levels (low safety) require growth to finance the debt burden. The current low growth level may be temporary, because professionals are actually optimistic (positive sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. Companies with less growth typically have a lower price than fast-growing competitors. Even though professional investor sentiment is strong, we recommend further evaluating whether the future of Mahindra & Mahindra is as challenging as the stock's low price suggests. Since the professional community is optimistic, the stock might just be going through a more challenging phase now, indicating that timing might be good now. ...read more
Sentiment Strategy: Professional Market Sentiment for Mahindra & Mahindra very positive
ANALYSIS: With an Obermatt Sentiment Rank of 96 (better than 96% compared with alternatives) for 2023, overall professional sentiment and engagement for the stock Mahindra & Mahindra is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all four indicators above average for Mahindra & Mahindra. Analyst Opinions are at a rank of 89 (better than 89% 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 78, 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 Mahindra & Mahindra. The Professional Investors rank is 72, which means that currently, professional investors hold more stock in this company than in 72% of alternative investment opportunities. Pros tend to favor investing in this company. Finally, Market Pulse has a rank of 78 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 78% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 96 (more positive than 96% compared with investment alternatives), Mahindra & Mahindra 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 Mahindra & Mahindra 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: Mahindra & Mahindra Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 62 (better than 62% compared with alternatives), Mahindra & Mahindra shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Mahindra & Mahindra. Price-to-Sales is 57 which means that the stock price compared with what market professionals expect for future sales is lower than for 57% of comparable companies, indicating a good value for Mahindra & Mahindra's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 61% 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 56. Compared with other companies in the same industry, dividend yields of Mahindra & Mahindra are expected to be higher than for 53% of all competitors (a Dividend Yield rank of 53). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 62, is a buy recommendation based on Mahindra & Mahindra'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 Mahindra & Mahindra based on its detailed value metrics.
Growth Strategy: Mahindra & Mahindra Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 29 (better than 29% compared with alternatives), Mahindra & Mahindra 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 half of the indicators below and half above average for Mahindra & Mahindra. Sales Growth has a rank of 54 which means that currently professionals expect the company to grow more than 54% of its competitors. Stock Returns are also above average with a rank of 53. But Capital Growth has only a rank of 28, which means that currently professionals expect the company to grow its invested capital less than 72% of its competitors. Profit Growth is also low, with a rank of only 37, which means that, currently, professionals expect the company to grow its profits below average. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 29, is a hold recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 53% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. ...read more
Safety Strategy: Mahindra & Mahindra Debt Financing Safety below-average
| SAFETY METRICS | July 6, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 9 |
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| REFINANCING | ||||||||
| REFINANCING | 59 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 17 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 25 |
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ANALYSIS: With an Obermatt Safety Rank of 25 (better than 25% compared with alternatives), the company Mahindra & Mahindra 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 Mahindra & Mahindra 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 Mahindra & Mahindra and the other two below average. Refinancing is at 59, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 59% of its competitors. But Leverage is high with a rank of 9, meaning the company has an above-average debt-to-equity ratio. It has more debt than 91% of its competitors. Liquidity is also on the riskier side with a rank of 17, meaning the company generates less profit to service its debt than 83% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 25 (worse than 75% compared with alternatives), Mahindra & Mahindra 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 Mahindra & Mahindra 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: Mahindra & Mahindra Lowest Financial Performance
| COMBINED PERFORMANCE | July 6, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 62 |
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| GROWTH | ||||||||
| GROWTH | 29 |
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| SAFETY | ||||||||
| SAFETY | 17 |
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| COMBINED | ||||||||
| COMBINED | 16 |
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ANALYSIS: With an Obermatt Combined Rank of 16 (worse than 84% compared with investment alternatives), Mahindra & Mahindra (Automobile Manufacturers, India) shares have lower financial characteristics compared with similar stocks. Shares of Mahindra & Mahindra are a good value (attractively priced) with a consolidated Value Rank of 62 (better than 62% of alternatives) but show below-average growth (Growth Rank of 29), and are riskily financed (Safety Rank of 25), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 16, is a sell recommendation based on Mahindra & Mahindra's financial characteristics. As the company Mahindra & Mahindra's key financial metrics exhibit good value (Obermatt Value Rank of 62) but low growth (Obermatt Growth Rank of 29) and risky financing practices (Obermatt Safety Rank of 25), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 62% of comparable companies, may indicate the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity. ...read more
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