November 21, 2024
Top 10 Stock Naspers 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: Naspers – Top 10 Stock in Johannesburg Securities Exchange All Shares Index JSE All Shares
Naspers is listed as a top 10 stock on November 21, 2024 in the market index JSE All Shares 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 74 (high 74% performer), Obermatt assesses an overall buy recommendation for Naspers on November 21, 2024.
Snapshot: Obermatt Ranks
| Country | South Africa |
| Industry | Internet Retail |
| Index | JSE All Shares |
| Size class | X-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 Naspers Buy
| 360 METRICS | November 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 19 |
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| GROWTH | ||||||||
| GROWTH | 97 |
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| SAFETY | ||||||||
| SAFETY | 66 |
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| SENTIMENT | ||||||||
| SENTIMENT | 51 |
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| 360° VIEW | ||||||||
| 360° VIEW | 74 |
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ANALYSIS: With an Obermatt 360° View of 74 (better than 74% compared with alternatives), overall professional sentiment and financial characteristics for the stock Naspers are above average. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Naspers. The consolidated Growth Rank has a good rank of 97, 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 97% of competitors in the same industry. The consolidated Safety Rank at 66 means that the company has a financing structure that is safer than 66% 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 51, which means that professional investors are more optimistic about the stock than for 51% of alternative investment opportunities. But the consolidated Value Rank is less desirable at 19, meaning that the share price of Naspers is on the higher side compared with indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 81% of alternative stocks in the same industry. ...read more
RECOMMENDATION: With a consolidated 360° View of 74, Naspers is better positioned than 74% 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 97), a safe financing structure (Safety Rank of 66), and positive professional market sentiment (Sentiment Rank of 51), 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 Naspers compared with alternatives? You can use the following rule of thumb: The growth rank measures the growth momentum of the company (97% better than peers). The value rank could be the reverse reflection of that (3%). 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 Naspers positive
ANALYSIS: With an Obermatt Sentiment Rank of 51 (better than 51% compared with alternatives), overall professional sentiment and engagement for the stock Naspers is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Naspers. Analyst Opinions are at a rank of 95 (better than 95% 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 46, 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 Naspers. The Professional Investors rank is also low at 17, meaning that professional investors hold less stock in this company than in 83% of alternative investment opportunities. Pros tend to invest in other companies. Even worse, Market Pulse has a low rank of 28, which means that the current professional news and professional social networks are critical of this company (more negative news than for 72% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 51 (more positive than 51% compared with investment alternatives), Naspers has a reputation among professional investors that is above-average compared with 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: Naspers Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 19 (worse than 81% compared with alternatives), Naspers 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 Naspers. Only Price-to-Profit (also referred to as price-earnings, P/E) indicates good stock value with a rank of 73, which means that the stock price compared with what market professionals expect for future profits is lower than for 73% of comparable companies, indicating a good value concerning Naspers's profit levels. But Price-to-Sales is 11 which means that the stock price compared with what market professionals expect for future profits is higher than for 89% of comparable companies, indicating a low value concerning Naspers'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 47 and for dividend yield, which is lower than for 85% 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 19, is a sell recommendation based on Naspers's stock price compared with the company's operational size and dividend yields. Can we rely on only one good value indicator? Only if we know the company well. In this case, a high Price-to-Profit Rank, while Price-to-Sales and Price-to-Book are both below the market typical levels, means that the company can charge higher prices for its products and needs less capital to produce them. If this is sustainable, then Naspers is a good investment because profits count most in enterprise valuations. The low dividend yield indicates that the company is confident it can do something with the generated cash that is more valuable than paying the profits out to the shareholders in the form of dividends. ...read more
Growth Strategy: Naspers Growth Momentum high
| GROWTH METRICS | November 21, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 88 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 85 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 79 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 69 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 97 |
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ANALYSIS: With an Obermatt Growth Rank of 97 (better than 97% compared with alternatives) for 2024, Naspers 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 four indicators above average for Naspers. Sales Growth has a value of 88, which means that, currently, professionals expect the company to grow more than 88% of its competitors. The same is valid for Profit Growth with a value of 85 and for Capital Growth with 79. In addition, Stock Returns had an above-average rank value of 69, which means they have been higher than 69% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 97, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Naspers exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. ...read more
Safety Strategy: Naspers Debt Financing Safety above-average
| SAFETY METRICS | November 21, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 83 |
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| REFINANCING | ||||||||
| REFINANCING | 89 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 8 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 66 |
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ANALYSIS: With an Obermatt Safety Rank of 66 (better than 66% compared with alternatives), the company Naspers 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 Naspers 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 two out of three are above average for Naspers.Leverage is at 83, meaning the company has a below-average debt-to-equity ratio. It has less debt than 83% of its competitors.Refinancing is at a rank of 89, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 89% of its competitors. Liquidity is at 8, meaning that the company generates less profit to service its debt than 92% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 66 (better than 66% compared with alternatives), Naspers has a financing structure that is safer than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. ...read more
Combined financial peformance: Naspers Top Financial Performance
| COMBINED PERFORMANCE | November 21, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 19 |
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| GROWTH | ||||||||
| GROWTH | 97 |
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| SAFETY | ||||||||
| SAFETY | 8 |
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| COMBINED | ||||||||
| COMBINED | 76 |
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ANALYSIS: With an Obermatt Combined Rank of 76 (better than 76% compared with investment alternatives), Naspers (Internet Retail, South Africa) shares have much better financial characteristics than comparable stocks. Shares of Naspers are low in value (priced high) with a consolidated Value Rank of 19 (worse than 81% of alternatives). But they show above-average growth (Growth Rank of 97) and are safely financed (Safety Rank of 66, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 76, is a strong buy recommendation based on Naspers's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Naspers exhibits low value (Obermatt Value Rank of 19), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 97). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 66) 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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