Fact based stock research
Meridian Energy (NZSE:MEL)
NZMELE0002S7
How to read the free 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.
Meridian Energy stock research in summary
ANALYSIS: With an Obermatt Combined Rank of 34 (worse than 66% compared with investment alternatives), Meridian Energy (Renewable Electricity, New Zealand) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Meridian Energy are low in value (priced high) with a consolidated Value Rank of 11 (worse than 89% of alternatives) and show below-average growth (Growth Rank of 39) but are safely financed (Safety Rank of 76), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 34, is a hold 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 11) and low growth (Obermatt Growth Rank of 39), 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 76) 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
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360° ViewnewThis stock has achievements: Top 10 Stock.
14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.
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Review the performance ranks of the individual metrics that form each investment strategy.
Research History: Meridian Energy
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 26 |
|
7 |
|
9 |
|
11 |
|
| GROWTH | ||||||||
| GROWTH | 17 |
|
11 |
|
5 |
|
39 |
|
| SAFETY | ||||||||
| SAFETY | 83 |
|
84 |
|
68 |
|
76 |
|
| SENTIMENT | ||||||||
| SENTIMENT | n/a |
|
60 |
|
6 |
|
new |
|
| 360° VIEW | ||||||||
| 360° VIEW | n/a |
|
29 |
|
4 |
|
new |
|
Combined financial peformance in Detail
ANALYSIS: With an Obermatt Combined Rank of 34 (worse than 66% compared with investment alternatives), Meridian Energy (Renewable Electricity, New Zealand) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Meridian Energy are low in value (priced high) with a consolidated Value Rank of 11 (worse than 89% of alternatives) and show below-average growth (Growth Rank of 39) but are safely financed (Safety Rank of 76), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 34, is a hold 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 11) and low growth (Obermatt Growth Rank of 39), 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 76) 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
| RESEARCH HISTORY | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 26 |
|
7 |
|
9 |
|
11 |
|
| GROWTH | ||||||||
| GROWTH | 17 |
|
11 |
|
5 |
|
39 |
|
| SAFETY | ||||||||
| SAFETY | 83 |
|
84 |
|
68 |
|
76 |
|
| COMBINED | ||||||||
| COMBINED | 76 |
|
14 |
|
8 |
|
34 |
|
Value Metrics in Detail
ANALYSIS: With an Obermatt Value Rank of 11 (worse than 89% 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 54% 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 22 which means that the stock price compared with what market professionals expect for future profits is higher than 78% 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 27 is also low. Compared with invested capital, the stock price is higher than for 73% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 11, 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 |
|
22 |
|
| PRICE VS. PROFITS (P/E) | ||||||||
| PRICE VS. PROFITS (P/E) | 33 |
|
5 |
|
9 |
|
9 |
|
| PRICE VS. CAPITAL (Market-to-Book) | ||||||||
| PRICE VS. CAPITAL (Market-to-Book) | 23 |
|
17 |
|
20 |
|
27 |
|
| DIVIDEND YIELD | ||||||||
| DIVIDEND YIELD | 45 |
|
56 |
|
59 |
|
54 |
|
| CONSOLIDATED RANK: VALUE | ||||||||
| CONSOLIDATED RANK: VALUE | 26 |
|
7 |
|
9 |
|
11 |
|
Growth Metrics in Detail
ANALYSIS: With an Obermatt Growth Rank of 39 (better than 39% compared with alternatives), Meridian Energy 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 three out of four indicators below average for Meridian Energy. Sales Growth has a below market rank of 15, which means that, currently, professionals expect the company to grow less than 85% of its competitors. The same is valid for Capital Growth, with a rank of 25, and Profit Growth, with a rank of 47. Currently, professionals expect the company to grow its profits less than 53% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 69, which means that the stock returns have recently been above 69% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 39, is a hold recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for Meridian Energy, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with recent above-market stock returns. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive stock returns are not yet a sign of recovery. Investors should look closely at the Value and Sentiment indicators before they make a stock purchasing decision, because growth is unlikely to be the driving argument behind this investment. 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 low here. ...read more
| GROWTH METRICS | 2021 | 2022 | 2023 | 2024 | ||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 68 |
|
6 |
|
35 |
|
15 |
|
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 34 |
|
72 |
|
53 |
|
47 |
|
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | n/a |
|
12 |
|
9 |
|
25 |
|
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 9 |
|
5 |
|
37 |
|
69 |
|
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 17 |
|
11 |
|
5 |
|
39 |
|
Safety Metrics in Detail
ANALYSIS: With an Obermatt Safety Rank of 76 (better than 76% compared with alternatives) for 2024, 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 52, meaning the company generates more profit to service its debt than 52% 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 43, 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 57% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 76 (better than 76% 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 |
|
82 |
|
| REFINANCING | ||||||||
| REFINANCING | 43 |
|
39 |
|
37 |
|
43 |
|
| LIQUIDITY | ||||||||
| LIQUIDITY | 62 |
|
100 |
|
42 |
|
52 |
|
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 83 |
|
84 |
|
68 |
|
76 |
|
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 |
|
Free stock analysis by the purely fact based Obermatt Method for Meridian Energy from November 14, 2024.
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