June 1, 2023
Top 10 Stock Mitsubishi Electric 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: Mitsubishi Electric – Top 10 Stock in Tokyo Stock Exchange TOPIX 100
Mitsubishi Electric is listed as a top 10 stock on June 01, 2023 in the market index TOPIX 100 because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company is safely financed, but all other facts speak against a stock purchase, especially the low market sentiment by professional investors. Based on the Obermatt 360° View of 49 (49% performer), Obermatt assesses an overall hold recommendation for Mitsubishi Electric on June 01, 2023.
Snapshot: Obermatt Ranks
| Country | Japan |
| Industry | Heavy Electrical Equipment |
| Index | TOPIX 100, Human Rights, Low Waste, Recycling, Water Tech, Nikkei 225 |
| 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° Assessment Mitsubishi Electric Hold
| 360 METRICS | June 1, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 47 |
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| GROWTH | ||||||||
| GROWTH | 49 |
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| SAFETY | ||||||||
| SAFETY | 94 |
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| SENTIMENT | ||||||||
| SENTIMENT | 49 |
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| 360° VIEW | ||||||||
| 360° VIEW | 49 |
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ANALYSIS: With an Obermatt 360° View of 49 (better than 49% compared with alternatives), overall professional sentiment and engagement for the stock Mitsubishi Electric are below the industry average. The 360° View is based on consolidating four consolidated indicators, with three out of four metrics below average for Mitsubishi Electric. The only rank that is above average is the consolidated Safety Rank at 94, which means that the company has a financing structure that is safer than 94% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the Value, Growth and Sentiment Ranks are all below average. The consolidated Value Rank has a less desirable rank of 47, which means that the share price of Mitsubishi Electric is on the high side compared with typical size in indicators such as revenues, profits, and invested capital. The consolidated Growth Rank also has a low rank of 49, which implies that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. Finally, the consolidated Sentiment Rank is also low at a rank of 49, which means that professional investors are more pessimistic about the stock than for 51% of alternative investment opportunities. While Safety is strong, it’s not the most critical indicator, so we suggest proceeding with caution if you are considering this stock. ...read more
RECOMMENDATION: With a 360° View of 49, Mitsubishi Electric is worse than 51% of all alternative stock investment opportunities based on the Obermatt Method. As only the financing structure, namely the Safety Rank, is on the safer side and all other consolidated Obermatt Ranks are below-average, this is a riskier stock investment proposition. This is especially the case, since professional investor sentiment, the consolidated Obermatt Sentiment Rank, is also low at 49. The negative market view on Mitsubishi Electric may be the high stock price (low value) or the low level of growth. This is a problem. As the Safety Rank is the least important of the four, we cannot identify enough positive facts that are visible today to make a case for this stock investment. The company may have a strong future which would justify the high stock price, but this is not visible from investor behavior today. As market sentiment is critical, you should be careful with paying more than market-average for this stock, and conduct further research into the company's future growth potential. Prudent investors may only want to invest a smaller portion of their wealth in such situations. Young investors can carry more risk but should still thrive for sufficient diversification. ...read more
Sentiment Strategy: Professional Market Sentiment for Mitsubishi Electric only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 49 (better than 49% compared with alternatives), overall professional sentiment and engagement for the stock Mitsubishi Electric is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Mitsubishi Electric. Analyst Opinions are at a rank of 53 (better than 53% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive and has a rank of 71 which means that currently, stock research experts are getting even more optimistic about investments in Mitsubishi Electric. But Market Pulse has a low rank of 18, 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 82% of competitors). This is an essential sign of caution, as it could be the forebearer of bad news. Professional Investors are also somewhat absent with a rank of 40, which means that, currently, professional investors hold less stock in this company than in 60% of alternative investment opportunities. Pros tend to invest in other companies. This is expected if the company is of a smaller size (medium or smaller). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 49 (less encouraging than 51% compared with investment alternatives), Mitsubishi Electric has a reputation among professional investors that is below that of its competitors. While the news in the professional market is negative, the analyst community is still optimistic about the company. It's an ambiguous situation with positive and negative signals from the professional side. Investors should be on the lookout for negative news but not worry too much about it as long as the overall news is still positive. ...read more
Value Strategy: Mitsubishi Electric Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 47 (worse than 53% compared with alternatives), Mitsubishi Electric shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half above average for Mitsubishi Electric. Price-to-Sales (P/S) is 67, which means that the stock price compared with what market professionals expect for future sales is lower than for 67% of comparable companies, indicating a good value concerning Mitsubishi Electric's revenue size. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio), which is more favorable than for 75% of alternatives (25% of peers have a higher ratio). But expected dividend yields with a Dividend Yield rank of 46 are lower than average (dividends are expected to be lower than 54% of other stocks) while the Price to Profit ratio (or Price to Earnings (P/E) ratio) is higher than average with a Price-to-Profit Rank of 42, making the stock more expensive compared with the company's expected profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 47, is a HOLD recommendation based on Mitsubishi Electric's stock price compared with the company's operational size and dividend yields. Low profits and low dividends as seen here for Mitsubishi Electric may indicate a restructuring phase. This could be transitory, making the company a good value when profits recover and dividends return to higher levels. If the stock price is compared with the size indicators for revenue and invested capital, it is on the lower side, making this stock a good value investment (apart from current profit and dividend expectations). ...read more
Growth Strategy: Mitsubishi Electric Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 49 (better than 49% compared with alternatives), Mitsubishi Electric 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 half of the indicators below and half above average for Mitsubishi Electric. Profit Growth has a rank of 75, which means that currently professionals expect the company to grow its profits more than 75% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 77 (above 77% of alternative investments). But Sales Growth has a below the median rank of 4, which means that, currently, professionals expect the company to grow less than 96% of its competitors, and Capital Growth also has a lower rank of 44. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 49, is a HOLD recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for Mitsubishi Electric. ...read more
Safety Strategy: Mitsubishi Electric Debt Financing Safety very solid
| SAFETY METRICS | June 1, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 74 |
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| REFINANCING | ||||||||
| REFINANCING | 69 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 82 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 94 |
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ANALYSIS: With an Obermatt Safety Rank of 94 (better than 94% compared with alternatives) for 2023, the company Mitsubishi Electric has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Mitsubishi Electric 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 Mitsubishi Electric. Leverage is at 74, meaning the company has a below-average debt-to-equity ratio. It has less debt than 74% of its competitors. Refinancing is at a rank of 69, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 69% of its competitors. Finally, Liquidity is also good at a rank of 82, which means that the company generates more profit to service its debt than 82% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 94 (better than 94% compared with alternatives), Mitsubishi Electric 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: Mitsubishi Electric Above-Average Financial Performance
| COMBINED PERFORMANCE | June 1, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 47 |
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| GROWTH | ||||||||
| GROWTH | 49 |
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| SAFETY | ||||||||
| SAFETY | 82 |
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| COMBINED | ||||||||
| COMBINED | 72 |
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ANALYSIS: With an Obermatt Combined Rank of 72 (better than 72% compared with investment alternatives), Mitsubishi Electric (Heavy Electrical Equipment, Japan) shares have above-average financial characteristics compared with similar stocks. Shares of Mitsubishi Electric are low in value (priced high) with a consolidated Obermatt Value Rank of 47 (worse than 53% of alternatives) and show below-average growth (Growth Rank of 49) but are safely financed (Safety Rank of 94), which means low debt burdens. ...read more
RECOMMENDATION: An Obermatt Combined Rank of 72, is a buy recommendation based on Mitsubishi Electric's financial characteristics. As the company Mitsubishi Electric's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 47) and low growth (Obermatt Growth Rank of 49), 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 94) 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. ...read more
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