April 11, 2024
Top 10 Stock MTN 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: MTN – Top 10 Stock in Johannesburg Securities Exchange All Shares Index JSE All Shares
MTN is listed as a top 10 stock on April 11, 2024 in the market index JSE All Shares 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 below average and thus a signal for caution. Based on the Obermatt 360° View of 56 (high 56% performer), Obermatt assesses an overall buy recommendation for MTN on April 11, 2024.
Snapshot: Obermatt Ranks
| Country | South Africa |
| Industry | Wireless Telecommunication |
| Index | Artificial Intelligence, Low Emissions, Good Governace Growth Markets, Independent Boards Growth Markets, Telecommunications, JSE All Shares |
| 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 MTN Buy
| 360 METRICS | April 11, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 84 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 78 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 41 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 1 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 56 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 56 (better than 56% compared with alternatives), overall professional sentiment and financial characteristics for the stock MTN are above average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for MTN. The consolidated Value Rank has an attractive rank of 84, which means that the share price of MTN 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 84% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 78, 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. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 1. Professional investors are more confident in 99% other stocks. Worryingly, the company has risky financing, with a Safety rank of 41. This means 59% of comparable companies have a safer financing structure than MTN. ...read more
RECOMMENDATION: With a consolidated 360° View of 56, MTN is better positioned than 56% of all alternative stock investment opportunities based on the Obermatt Method. Even though half of the consolidated Obermatt Ranks are above-average, namely the Value Rank at 84 and the Growth Rank above-average at 78, the picture is still mixed. The professional investor community is skeptical, with the Sentiment Rank below-average at 1. In addition, the company financing structure is on the riskier side (Safety Rank of 41). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. One may be tempted by above-average growth, but that could also change quickly, as past performance is not a good indicator of future performance. Since the financing structure is on the risky side, investors should 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 MTN negative
ANALYSIS: With an Obermatt Sentiment Rank of 1 (better than 1% compared with alternatives), overall professional sentiment and engagement for the stock MTN is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for MTN. Analyst Opinions are at a rank of 21 (worse than 79% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 28 which means that stock research experts are getting even more pessimistic. It doesn't end with the analysts. Market Pulse is also low with a rank of 27, 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 73% of competitors). No wonder, the Professional Investors rank is only 4, which means that professional investors hold less stock in this company than in 96% of alternative investment opportunities. Pros tend to stay away from MTN, which may be due to a small company size but just as likely because of its relatively low Sentiment Rank. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 1 (less encouraging than 99% compared with investment alternatives), MTN has a reputation among professional investors that is far below that of its competitors. Investors should be careful with this stock right now. Further research is required if an investment is desired, because the facts found in the professional community are all negative. ...read more
Value Strategy: MTN Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 84 (better than 84% compared with alternatives) for 2024, MTN shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for MTN. Price-to-Sales is 83 which means that the stock price compared with what market professionals expect for future sales is lower than for 83% of comparable companies, indicating a good value for MTN's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 74% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 83. Compared with other companies in the same industry, dividend yields of MTN are expected to be higher than for 59% of all competitors (a Dividend Yield rank of 59). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 84, is a buy recommendation based on MTN's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in MTN based on its detailed value metrics.
Growth Strategy: MTN Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 78 (better than 78% compared with alternatives) for 2024, MTN shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for MTN. Sales Growth has a value of 78 which means that currently professionals expect the company to grow more than 78% of its competitors. Profit Growth with a value of 86 and Capital Growth with a rank of 65 means that currently, professionals expect the company to grow both profits and invested capital more than of its competitors. But Stock Returns has only a rank of 8, which means that stock returns have recently been below 92% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 78, is a buy recommendation for growth and momentum investors. MTN has only one below-average growth indicator, the stock returns. This is probably the least reliable growth indicator, because it measures company and investor expectations at the same time. The three other growth indicators, which are all positive for MTN, are more reliable measures of growth momentum. For this reason, the company seems to be on a good trajectory, unless you think the current period is not representative, because of unique events that will not be repeated in the future. ...read more
Safety Strategy: MTN Debt Financing Safety below-average
| SAFETY METRICS | April 11, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 48 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 27 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 49 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 41 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 41 (better than 41% compared with alternatives), the company MTN has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of MTN is also risky, it only means that the company is on the riskier side in respect to bankruptcy in case things turn sour, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with all three metrics below average for MTN. Liquidity is at 49, meaning that the company generates less profit to service its debt than 51% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 48, meaning the company has an above-average debt-to-equity ratio. It has more debt than 52% of its competitors. Finally, Refinancing is at a rank of 27 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 73% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 41 (worse than 59% compared with alternatives), MTN has a financing structure that is riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing.
Combined financial peformance: MTN Top Financial Performance
| COMBINED PERFORMANCE | April 11, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 84 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 78 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 49 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 84 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 84 (better than 84% compared with investment alternatives), MTN (Wireless Telecommunication, South Africa) shares have much better financial characteristics than comparable stocks. Shares of MTN are a good value (attractively priced) with a consolidated Value Rank of 84 (better than 84% of alternatives), show above-average growth (Growth Rank of 78) but are riskily financed (Safety Rank of 41), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 84, is a strong buy recommendation based on MTN's financial characteristics. As the company MTN's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 84) and above-average growth (Obermatt Growth Rank of 78), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 41) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.