March 28, 2024
Top 10 Stock Metso Outotec 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: Metso Outotec – Top 10 Stock in Optionsmäklarna Helsinki Stock Exchange Helsinki Index OMX 25
Metso Outotec is listed as a top 10 stock on March 28, 2024 in the market index OMX 25 because of its high performance in at least one of the Obermatt investment strategies. Three consolidated Obermatt Ranks are above-average. Only the Value Rank is below average. The investment rationale may be an investment in future growth, supported by professional market opinion. Based on the Obermatt 360° View of 67 (high 67% performer), Obermatt assesses an overall buy recommendation for Metso Outotec on March 28, 2024.
Snapshot: Obermatt Ranks
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 Metso Outotec Buy
| 360 METRICS | March 28, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 41 |
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| GROWTH | ||||||||
| GROWTH | 65 |
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| SAFETY | ||||||||
| SAFETY | 51 |
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| SENTIMENT | ||||||||
| SENTIMENT | 54 |
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| 360° VIEW | ||||||||
| 360° VIEW | 67 |
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ANALYSIS: With an Obermatt 360° View of 67 (better than 67% compared with alternatives), overall professional sentiment and financial characteristics for the stock Metso Outotec are above average. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Metso Outotec. The consolidated Growth Rank has a good rank of 65, 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. This means that growth is higher than for 65% of competitors in the same industry. The consolidated Safety Rank at 51 means that the company has a financing structure that is safer than 51% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a good rank of 54, which means that professional investors are more optimistic about the stock than for 54% of alternative investment opportunities. But the consolidated Value Rank is less desirable at 41, meaning that the share price of Metso Outotec is on the higher side compared with indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 59% of alternative stocks in the same industry. ...read more
RECOMMENDATION: With a consolidated 360° View of 67, Metso Outotec is better positioned than 67% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as above-average growth (Growth Rank of 65), a safe financing structure (Safety Rank of 51), and positive professional market sentiment (Sentiment Rank of 54), it is a solid stock investment where growth may be the strongest driver of the investment rationale, also reflected by institutional investors. It is typical for growth companies to have low value, as is the case here. Investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of Metso Outotec compared with alternatives? You can use the following rule of thumb: The growth rank measures the growth momentum of the company (65% better than peers). The value rank could be the reverse reflection of that (35%). A Value Rank below that level may be assessed as expensive, a rank above that is still good value. Sometimes market sentiment just reflects the past, sometimes the reality. You pay more than the market average for this stock, but it may be worth it. ...read more
Sentiment Strategy: Professional Market Sentiment for Metso Outotec positive
ANALYSIS: With an Obermatt Sentiment Rank of 54 (better than 54% compared with alternatives), overall professional sentiment and engagement for the stock Metso Outotec is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Metso Outotec. Analyst Opinions are at a rank of 48 (worse than 52% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 50, which means that stock research experts are more positive in their investment recommendations in the company. In other words, they are getting more optimistic of stock investments in Metso Outotec. More encouragingly, the Professional Investors rank is 77, which means that professional investors hold more stock in this company than in 77% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 7, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 93% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 54 (more positive than 54% compared with investment alternatives), Metso Outotec has a reputation among professional investors that is above-average compared with that of its competitors. The sentiment signals are mixed for Metso Outotec. While analysts and the news channels are negative, there is a change in what analysts think. Above-average institutional investors in this company support them. Sentiment signals remain mixed with analysts and news channels pessimistic, though improving, and professional investors above average. ...read more
Value Strategy: Metso Outotec Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 41 (worse than 59% compared with alternatives), Metso Outotec shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Metso Outotec. 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 Metso Outotec'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 22, which means that the stock price is lower as regards to invested capital than for 22% of comparable investments. On the other hand, Price-to-Sales is less favorable than 78% of alternatives (only 22% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 24% 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 41, is a hold recommendation based on Metso Outotec'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: Metso Outotec Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 65 (better than 65% compared with alternatives), Metso Outotec 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 half of the indicators below and half above average for Metso Outotec. Capital Growth has a rank of 55, which means that currently professionals expect the company to grow its invested capital more than 37% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 75 (above 75% of alternative investments). But Sales Growth has only a rank of 39, which means that, currently, professionals expect the company to grow less than 61% of its competitors, and Profit Growth is also low at a rank of 37. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 65, is a buy recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for Metso Outotec, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. ...read more
Safety Strategy: Metso Outotec Debt Financing Safety above-average
| SAFETY METRICS | March 28, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 44 |
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| REFINANCING | ||||||||
| REFINANCING | 52 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 54 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 51 |
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ANALYSIS: With an Obermatt Safety Rank of 51 (better than 51% compared with alternatives), the company Metso Outotec has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Metso Outotec 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 Metso Outotec. Refinancing is at 52, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 52% of its competitors. Liquidity is also good at 54, meaning the company generates more profit to service its debt than 54% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 44, which means the company has an above-average debt-to-equity ratio. It has more debt than 56% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 51 (better than 51% compared with alternatives), Metso Outotec has a financing structure that is safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Metso Outotec could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. ...read more
Combined financial peformance: Metso Outotec Above-Average Financial Performance
| COMBINED PERFORMANCE | March 28, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 41 |
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| GROWTH | ||||||||
| GROWTH | 65 |
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| SAFETY | ||||||||
| SAFETY | 54 |
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| COMBINED | ||||||||
| COMBINED | 70 |
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ANALYSIS: With an Obermatt Combined Rank of 70 (better than 70% compared with investment alternatives), Metso Outotec (Heavy Machinery, Finland) shares have above-average financial characteristics compared with similar stocks. Shares of Metso Outotec are low in value (priced high) with a consolidated Value Rank of 41 (worse than 59% of alternatives). But they show above-average growth (Growth Rank of 65) and are safely financed (Safety Rank of 51, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 70, is a buy recommendation based on Metso Outotec's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Metso Outotec exhibits low value (Obermatt Value Rank of 41), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 65). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 51) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more
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