Fact based stock research
Meridian Energy (NZSE:MEL)

NZMELE0002S7

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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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Meridian Energy stock research in summary

meridianenergy.co.nz

ANALYSIS: With an Obermatt Combined Rank of 22 (worse than 78% compared with investment alternatives), Meridian Energy (Renewable Electricity, New Zealand) shares have lower financial characteristics compared with similar stocks. Shares of Meridian Energy are low in value (priced high) with a consolidated Value Rank of 7 (worse than 93% of alternatives) and show below-average growth (Growth Rank of 15) but are safely financed (Safety Rank of 88), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 22, is a sell recommendation based on Meridian Energy's financial characteristics. As the company Meridian Energy's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 7) and low growth (Obermatt Growth Rank of 15), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. In this case, good financing practices (Obermatt Safety Rank of 88) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for a small fraction of a safe portfolio. 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	n/a
Growth Rank	n/a
Safety Rank	n/a
Combined Rank	n/a

Country	New Zealand
Industry	Renewable Electricity
Index	SDG 13, SDG 15, SDG 5, SDG 7, NZSX 50
Size class	Large

This stock has achievements: Top 10 Stock.

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Further information

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Research History: Meridian Energy

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	26	7	9	n/a
GROWTH
GROWTH	17	11	5	n/a
SAFETY
SAFETY	83	84	68	n/a
SENTIMENT
SENTIMENT	n/a	60	6	^new
360° VIEW
360° VIEW	n/a	29	4	^new

Most recent update of the stock research: . Financial reporting date used for calculating ranks: . Stock research history is based on the Obermatt Method. The higher the rank, the better Meridian Energy is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	26	7	9	n/a
GROWTH
GROWTH	17	11	5	n/a
SAFETY
SAFETY	83	84	68	n/a
COMBINED
COMBINED	76	14	8	n/a

Last update of combined financial performance: . Stock analysis on combined financial performance: The higher the rank of Meridian Energy the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 7 (worse than 93% compared with alternatives), Meridian Energy 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 Meridian Energy. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 55% 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 17 which means that the stock price compared with what market professionals expect for future profits is higher than 83% of comparable companies, indicating a low value concerning Meridian Energy's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 9 which means that the stock price compared with what market professionals expect for future profit levels is higher than 91% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 23 is also low. Compared with invested capital, the stock price is higher than for 77% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 7, is a sell recommendation based on Meridian Energy's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Meridian Energy? 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 Meridian Energy only if they reasonably expect the low current profit levels to be transitory. 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 essential 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)	38	19	16	n/a
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	33	5	9	n/a
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	23	17	20	n/a
DIVIDEND YIELD
DIVIDEND YIELD	45	56	59	n/a
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	26	7	9	n/a

Last update of Value Rank: . Stock analysis on value ratios: The higher the rank, the lower the value ratio of Meridian Energy; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 15 (better than 15% compared with alternatives), Meridian Energy shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with three out of four metrics below average for Meridian Energy. While Profit Growth has a good rank of 51, as professionals currently expect the company to grow its profits more than 51% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 31, which means that currently professionals expect the company to grow less than 69% of its competitors, while Capital Growth has a rank of 6 and Stock Returns have been below market median, with a rank of 37 (63% of alternative investments were better). ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 15, is a sell recommendation for growth and momentum investors. While revenue growth and capital growth are good growth momentum indicators, profit is less reliable, because profits may increase due to cost-cutting measures which typically indicate negative growth momentum. "You can save a dollar only once" is the saying about such situations. Growth Investors should look at company priorities closely if they are interested in growth, because the increase in profits is not usually an indicator of growth, and stock prices have been below market, too. 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 is limited here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	68	6	35	n/a
PROFIT GROWTH
PROFIT GROWTH	34	72	53	n/a
CAPITAL GROWTH
CAPITAL GROWTH	n/a	12	9	n/a
STOCK RETURNS
STOCK RETURNS	9	5	37	n/a
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	17	11	5	n/a

Last update of Growth Rank: . Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Meridian Energy.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 88 (better than 88% compared with alternatives) for 2025, the company Meridian Energy has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Meridian Energy is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above average for Meridian Energy. Leverage is at a rank of 82, meaning the company has a below-average debt-to-equity ratio. It has less debt than 82% of its competitors. Liquidity is also good at a rank of 73, meaning the company generates more profit to service its debt than 73% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 37, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 63% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 88 (better than 88% compared with alternatives), Meridian Energy has a financing structure that is significantly safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Meridian Energy. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. Investors may have a short-term debt challenge with Meridian Energy and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	87	76	82	n/a
REFINANCING
REFINANCING	43	39	37	n/a
LIQUIDITY
LIQUIDITY	62	100	42	n/a
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	83	84	68	n/a

Last update of Safety Rank: . Stock analysis on safety metrics: The higher the rank, the lower the leverage of Meridian Energy 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	42	31	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	83	25	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	26	14	^new
MARKET PULSE
MARKET PULSE	n/a	51	47	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	60	6	^new

Last update of Sentiment Rank: . Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Meridian Energy.
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