November 7, 2024
Top 10 Stock Metalurgica Gerdau Hold 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: Metalurgica Gerdau – Top 10 Stock in Bolsa de Valores-Mercadorias | BOVESPA
Metalurgica Gerdau is listed as a top 10 stock on November 07, 2024 in the market index BOVESPA because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 40 (40% performer), Obermatt assesses an overall hold recommendation for Metalurgica Gerdau on November 07, 2024.
Snapshot: Obermatt Ranks
| Country | Brazil |
| Industry | Steel |
| Index | BOVESPA, Water Efficiency |
| 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 Metalurgica Gerdau Hold
| 360 METRICS | November 7, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 73 |
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| GROWTH | ||||||||
| GROWTH | 15 |
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| SAFETY | ||||||||
| SAFETY | 90 |
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| SENTIMENT | ||||||||
| SENTIMENT | 23 |
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| 360° VIEW | ||||||||
| 360° VIEW | 40 |
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ANALYSIS: With an Obermatt 360° View of 40 (better than 40% compared with alternatives), overall professional sentiment and financial characteristics for the stock Metalurgica Gerdau are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Metalurgica Gerdau. The consolidated Value Rank has an attractive rank of 73, which means that the share price of Metalurgica Gerdau 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 73% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 90. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 23. Professional investors are more confident in 77% other stocks. The consolidated Growth Rank also has a low rank of 15, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 85 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 40, Metalurgica Gerdau is worse than 60% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 73), and the financing structure is on the safer side (Safety Rank of 90). However, sentiment in the professional investor community is below-average (Sentiment Rank of 23), as is the growth momentum for the company (Growth Rank of 15). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for Metalurgica Gerdau negative
ANALYSIS: With an Obermatt Sentiment Rank of 23 (better than 23% compared with alternatives), overall professional sentiment and engagement for the stock Metalurgica Gerdau is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Metalurgica Gerdau. Analyst Opinions are at a rank of 78 (better than 78% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. This is a good sign, were it not for Analyst Opinions Change with a low rank of 1, which means that currently, stock research experts are changing their opinions for the worse. In other words, they are getting more critical of a stock investment in Metalurgica Gerdau. The Professional Investors rank is also low at 44, meaning that professional investors hold less stock in this company than in 56% of alternative investment opportunities. Pros tend to invest in other companies. Even worse, Market Pulse has a low rank of 4, which means that the current professional news and professional social networks are critical of this company (more negative news than for 96% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 23 (less encouraging than 77% compared with investment alternatives), Metalurgica Gerdau has a reputation among professional investors that is far below that of its competitors. There are several negative sentiment signals, with only the Analyst Opinions Rank above average. This could be a stock with a long reputation for being positive but where things are worsening. Most analysts may not see it yet, but some have, and the professionals are already quite pessimistic. Proceed with caution when investing in this stock. ...read more
Value Strategy: Metalurgica Gerdau Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 73 (better than 73% compared with alternatives), Metalurgica Gerdau shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Metalurgica Gerdau. Price-to-Profit (also referred to as price to earnings, P/E ratio) is 95 which means that the stock price compared with what market professionals expect for future profits is lower than for 95% of comparable companies, indicating a good value concerning Metalurgica Gerdau's profit levels. The same is valid for the expected Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 90, and for Dividend Yield with a Dividend Yield Rank of 81. But, compared with other companies in the same industry, the stock price is higher than average as regards expected revenues; only 83% of all competitors have an even higher stock price as regards to sales revenues (a Price-to-Sales Rank of 17). Profits, the level of invested capital, and dividend policy suggest that this stock is attractively priced. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 73, is a buy recommendation based on Metalurgica Gerdau's stock price compared with the company's operational size and dividend yields. Since it is on the expensive side for Price-to-Sales, it may mean that Metalurgica Gerdau has pricing power in its distribution market because it can charge higher prices than its competitors. If this is the case, all four value indicators are positive signals for purchasing Metalurgica Gerdau shares. ...read more
Growth Strategy: Metalurgica Gerdau Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 15 (better than 15% compared with alternatives), Metalurgica Gerdau 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 indicators below average for Metalurgica Gerdau. Only Capital Growth has a good rank of 59, which means that currently professionals expect the company to grow its invested capital more than 6% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 26 which means that currently professionals expect the company to grow less than 74% of its competitors. Profit Growth with a rank of 6 and Stock Returns with a rank of 43 are also low (below 57% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 15, is a sell recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Metalurgica Gerdau is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. ...read more
Safety Strategy: Metalurgica Gerdau Debt Financing Safety very solid
| SAFETY METRICS | November 7, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 64 |
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| REFINANCING | ||||||||
| REFINANCING | 99 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 61 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 90 |
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ANALYSIS: With an Obermatt Safety Rank of 90 (better than 90% compared with alternatives) for 2024, the company Metalurgica Gerdau has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Metalurgica Gerdau 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, where all three are above average for Metalurgica Gerdau. Leverage is at 64, meaning the company has a below-average debt-to-equity ratio. It has less debt than 64% of its competitors. Refinancing is at a rank of 99, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 99% of its competitors. Finally, Liquidity is also good at a rank of 61, which means that the company generates more profit to service its debt than 61% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 90 (better than 90% compared with alternatives), Metalurgica Gerdau has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more
Combined financial peformance: Metalurgica Gerdau Above-Average Financial Performance
| COMBINED PERFORMANCE | November 7, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 73 |
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| GROWTH | ||||||||
| GROWTH | 15 |
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| SAFETY | ||||||||
| SAFETY | 61 |
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| COMBINED | ||||||||
| COMBINED | 64 |
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ANALYSIS: With an Obermatt Combined Rank of 64 (better than 64% compared with investment alternatives), Metalurgica Gerdau (Steel, Brazil) shares have above-average financial characteristics compared with similar stocks. Shares of Metalurgica Gerdau are a good value (attractively priced) with a consolidated Value Rank of 73 (better than 73% of alternatives), are safely financed (Safety Rank of 90, which means low debt burdens), but show below-average growth (Growth Rank of 15). ...read more
RECOMMENDATION: A Combined Rank of 64, is a buy recommendation based on Metalurgica Gerdau's financial characteristics. As the company Metalurgica Gerdau's key financial metrics exhibit good value (Obermatt Value Rank of 73) but low growth (Obermatt Growth Rank of 15) while being safely financed (Obermatt Safety Rank of 90), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 73% of comparable companies, may also indicate that 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 and the downside is limited due to below-average financing risks. ...read more
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