July 25, 2024
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 Bombay Stock Exchange Sensitive Index BSE Sensex
Mahindra & Mahindra is listed as a top 10 stock on July 25, 2024 in the market index BSE Sensex because of its high performance in at least one of the Obermatt investment strategies. As three out of four consolidated Obermatt Ranks exhibit excellent performance, it is a solid investment where the risk of paying too much for the shares is low. Based on the Obermatt 360° View of 66 (high 66% performer), Obermatt assesses an overall buy recommendation for Mahindra & Mahindra on July 25, 2024.
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 | X-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 25, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 51 |
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| GROWTH | ||||||||
| GROWTH | 51 |
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| SAFETY | ||||||||
| SAFETY | 24 |
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| SENTIMENT | ||||||||
| SENTIMENT | 88 |
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| 360° VIEW | ||||||||
| 360° VIEW | 66 |
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ANALYSIS: With an Obermatt 360° View of 66 (better than 66% 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 all but one indicator above average for Mahindra & Mahindra. The consolidated Value Rank has an attractive rank of 51, 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 the stock price is lower than for 51% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 51, 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. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 88. But the company’s financing is risky with a Safety rank of 24. This means 76% of comparable companies have a safer financing structure than Mahindra & Mahindra. ...read more
RECOMMENDATION: With a consolidated 360° View of 66, Mahindra & Mahindra is better positioned than 66% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 51), above-average growth (Growth Rank of 51), and positive market sentiment in the professional investor community (Sentiment Rank of 88), it is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely, unless information not publicly available. Only the company financing structure is on the riskier side (Safety Rank of 24), but that would also mean better returns for shareholders if things work out well. Good value is sometimes an indication that the company's future is challenging. If they have been growing above average and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of Mahindra & Mahindra is as difficult as the low price of the stock, despite good growth and positive professional investor sentiment, suggests. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible right now, which may indicate good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for Mahindra & Mahindra very positive
ANALYSIS: With an Obermatt Sentiment Rank of 88 (better than 88% compared with alternatives) for 2024, 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 but one indicator above average for Mahindra & Mahindra. Analyst Opinions are at a rank of 97 (better than 97% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. In addition, Analyst Opinions Change has a rank of 52, which means that currently, stock research experts are getting even more optimistic. Obermatt Market Pulse further supports this with a rank of 75, which means that the current professional news and professional social networks are generally positive when discussing this company (more positive news than for 75% of competitors). But there are few stock holdings by institutional investors. The Professional Investors rank is low at 29, which means that currently, professional investors hold less stock in this company than in 71% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 88 (more positive than 88% compared with investment alternatives), Mahindra & Mahindra has a reputation among professional investors that is significantly higher than that of its competitors. Not having too many professionals invested in Mahindra & Mahindra may be less of an issue, especially if the stock is from a smaller company where professionals typically invest less. It is natural for professional investors to focus on large and extra-large companies, as they provide more safety. Smaller companies attract fewer professionals in the shareholder community. Overall, the signals from the professionals are still quite favorable for investments in Mahindra & Mahindra. ...read more
Value Strategy: Mahindra & Mahindra Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 51 (better than 51% 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, with half of the indicators below and half above average for Mahindra & Mahindra. Price-to-Profit (also referred to as price-earnings, P/E) is 50 which means that the stock price compared with what market professionals expect for future profits is lower than for 50% of comparable companies, indicating a good value concerning Mahindra & Mahindra'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 45, which means that the stock price is lower as regards to invested capital than for 45% of comparable investments. On the other hand, Price-to-Sales is less favorable than 52% of alternatives (only 48% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 47% 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 51, is a buy recommendation based on Mahindra & Mahindra'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. ...read more
Growth Strategy: Mahindra & Mahindra Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 51 (better than 51% compared with alternatives), Mahindra & Mahindra 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 Mahindra & Mahindra. Sales Growth has a rank of 60 which means that currently, professionals expect the company to grow more than 60% of its competitors. Capital Growth is also above 32% of competitors with a rank of 58, and Stock Returns with the rank of 72 is also an outperformance. Only Profit Growth is low with a rank of 32 which means that currently, professionals expect the company to grow its profits less than 68% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 51, is a buy recommendation for growth and momentum investors. All three operating growth indicators, namely revenue, profit, and capital growth, are showing improvements. This is a good indication of a company with a positive future. That might, at the same time, be the simple reason why profit growth is low. A growing company needs money and thus can't yet show high profit growth. Look out for signs in corporate communication about extra growth efforts costing time and money. If that is the case, Mahindra & Mahindra is a good growth stock. ...read more
Safety Strategy: Mahindra & Mahindra Debt Financing Safety risky
| SAFETY METRICS | July 25, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 8 |
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| REFINANCING | ||||||||
| REFINANCING | 59 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 23 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 24 |
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ANALYSIS: With an Obermatt Safety Rank of 24 (better than 24% compared with alternatives), the company Mahindra & Mahindra 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 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 8, meaning the company has an above-average debt-to-equity ratio. It has more debt than 92% of its competitors. Liquidity is also on the riskier side with a rank of 23, meaning the company generates less profit to service its debt than 77% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 24 (worse than 76% compared with alternatives), Mahindra & Mahindra has a financing structure that is significantly 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 25, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 51 |
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| GROWTH | ||||||||
| GROWTH | 51 |
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| SAFETY | ||||||||
| SAFETY | 23 |
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| COMBINED | ||||||||
| COMBINED | 22 |
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ANALYSIS: With an Obermatt Combined Rank of 22 (worse than 78% 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 51 (better than 51% of alternatives), show above-average growth (Growth Rank of 51) but are riskily financed (Safety Rank of 24), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 22, is a sell recommendation based on Mahindra & Mahindra's financial characteristics. As the company Mahindra & Mahindra's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 51) and above-average growth (Obermatt Growth Rank of 51), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 24) 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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