Fact based stock research
Nordea Bank (OM:NDA SE)

FI4000297767

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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.

Nordea Bank stock research in summary

nordea.fi

ANALYSIS: With an Obermatt Combined Rank of 8 (worse than 92% compared with investment alternatives), Nordea Bank (Diversified Banks, Sweden) shares have lower financial characteristics compared with similar stocks. Shares of Nordea Bank are a good value (attractively priced) with a consolidated Value Rank of 50 (better than 50% of alternatives) but show below-average growth (Growth Rank of 14), and are riskily financed (Safety Rank of 37), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 8, is a sell recommendation based on Nordea Bank's financial characteristics. As the company Nordea Bank's key financial metrics exhibit good value (Obermatt Value Rank of 50) but low growth (Obermatt Growth Rank of 14) and risky financing practices (Obermatt Safety Rank of 37), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 50% of comparable companies, may indicate 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. Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	50
Growth Rank	14
Safety Rank	37
Combined Rank	8

Country	Sweden
Industry	Diversified Banks
Index	OMX 25, Dividends Europe, Human Rights, Renewables Users, OMX 30
Size class	XX-Large

This stock has achievements: Top 10 Stock.

2-May-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Nordea Bank

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	31	35	34	50
GROWTH
GROWTH	81	79	34	14
SAFETY
SAFETY	21	15	31	37
SENTIMENT
SENTIMENT	n/a	100	98	^new
360° VIEW
360° VIEW	n/a	65	48	^new

Most recent update of the stock research: 2-May-2024. Financial reporting date used for calculating ranks: 31-Dec-2023. Stock research history is based on the Obermatt Method. The higher the rank, the better Nordea Bank is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	31	35	34	50
GROWTH
GROWTH	81	79	34	14
SAFETY
SAFETY	21	15	31	37
COMBINED
COMBINED	28	35	8	8

Last update of combined financial performance: 2-May-2024. Stock analysis on combined financial performance: The higher the rank of Nordea Bank the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 50 (better than 50% compared with alternatives), Nordea Bank shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Nordea Bank. Price-to-Profit (also referred to as price-earnings, P/E) is 62 which means that the stock price compared with what market professionals expect for future profits is lower than for 62% of comparable companies, indicating a good value concerning Nordea Bank'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 34, which means that the stock price is lower as regards to invested capital than for 34% of comparable investments. On the other hand, Price-to-Sales is less favorable than 56% of alternatives (only 44% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 8% 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 50, is a buy recommendation based on Nordea Bank'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. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is especially important in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	17	22	31	44
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	19	56	45	62
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	42	26	25	34
DIVIDEND YIELD
DIVIDEND YIELD	44	89	87	92
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	31	35	34	50

Last update of Value Rank: 2-May-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Nordea Bank; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 14 (better than 14% compared with alternatives), Nordea Bank 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 metrics below average for Nordea Bank. While Profit Growth has a good rank of 62, as professionals currently expect the company to grow its profits more than 62% of its competitors, all other growth indicators are below market averages. Sales Growth has a rank of 26, which means that currently professionals expect the company to grow less than 74% of its competitors, while Capital Growth has a rank of 15 and Stock Returns have been below market median, with a rank of 34 (66% of alternative investments were better). ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 14, is a sell recommendation for growth and momentum investors. While revenue growth and capital growth are good growth momentum indicators, profit is less reliable, because profits may increase due to cost-cutting measures which typically indicate negative growth momentum. "You can save a dollar only once" is the saying about such situations. Growth Investors should look at company priorities closely if they are interested in growth, because the increase in profits is not usually an indicator of growth, and stock prices have been below market, too. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case, especially since the growth performance is limited here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	66	36	66	26
PROFIT GROWTH
PROFIT GROWTH	59	38	54	62
CAPITAL GROWTH
CAPITAL GROWTH	n/a	83	15	15
STOCK RETURNS
STOCK RETURNS	80	89	52	34
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	81	79	34	14

Last update of Growth Rank: 2-May-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Nordea Bank.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 37 (better than 37% compared with alternatives), the company Nordea Bank 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 Nordea Bank 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 two out of three indicators above-average for Nordea Bank. Refinancing is at 68, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 68% of its competitors. Liquidity is also good at 63, meaning the company generates more profit to service its debt than 63% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 6, which means the company has an above-average debt-to-equity ratio. It has more debt than 94% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 37 (worse than 63% compared with alternatives), Nordea Bank has a financing structure that is riskier 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 Nordea Bank 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. In the long-term, investors may have a debt challenge with Nordea Bank and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	8	8	6	6
REFINANCING
REFINANCING	96	23	73	68
LIQUIDITY
LIQUIDITY	4	78	67	63
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	21	15	31	37

Last update of Safety Rank: 2-May-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Nordea Bank and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	69	88	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	86	46	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	96	92	^new
MARKET PULSE
MARKET PULSE	n/a	89	95	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	100	98	^new

Last update of Sentiment Rank: 2-May-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Nordea Bank.
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