June 22, 2023
Top 10 Stock Omron Sell 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: Omron – Top 10 Stock in Nikkei 225 Index
Omron is listed as a top 10 stock on June 22, 2023 in the market index Nikkei 225 because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. While the company shows high growth, the stock price is high yet professional investor sentiment is low, which may be due to overly optimistic investor behavior, reflected in a low stock price value. Based on the Obermatt 360° View of 19 (19% performer), Obermatt issues an overall sell recommendation for Omron on June 22, 2023.
Snapshot: Obermatt Ranks
| Country | Japan |
| Industry | Electronic Components |
| Index | Recycling, Water Tech, Nikkei 225 |
| 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 Omron Sell
| 360 METRICS | June 22, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 7 |
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| GROWTH | ||||||||
| GROWTH | 53 |
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| SAFETY | ||||||||
| SAFETY | 97 |
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| SENTIMENT | ||||||||
| SENTIMENT | 27 |
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| 360° VIEW | ||||||||
| 360° VIEW | 19 |
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ANALYSIS: With an Obermatt 360° View of 19 (better than 19% compared with alternatives), overall professional sentiment and financial characteristics for the stock Omron are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Omron. The consolidated Growth Rank has a good rank of 53, 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 53% of competitors in the same industry. In addition, the consolidated Safety Rank has a safer rank of 97 which means that the company has a financing structure that is safer than 97% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the consolidated Value Rank has a less desirable rank of 7 which means that the share price of Omron is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is higher than for 93% of alternative stocks in the same industry. The consolidated Sentiment Rank also has a low rank of 27, which means that professional investors are more pessimistic about the stock than for 73% of alternative investment opportunities. ...read more
RECOMMENDATION: With a 360° View of 19, Omron is worse than 81% of all alternative stock investment opportunities based on the Obermatt Method. This means that Omron shares are on the riskier side for investors. As only half of the consolidated Obermatt Ranks exhibit excellent performance, the picture is ambiguous. Growth is above-average (Growth Rank of 53), and the company is safely financed (Safety Rank of 97). However, professional market sentiment is low(Sentiment Rank of 27). The negative market view on Omron may be due to the high stock price (low value). A growth company like this may get too expensive at one point in time. If too many investors are desperate to board the train, they may drive stock prices above reasonable levels. It is typical for growth companies to have low value ratings, because 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 Omron compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one hundred minus the growth rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value if the value rank is above 60. As market sentiment is low, you should be careful with paying more than market-average for this stock and conduct further research into the company’s future growth potential. ...read more
Sentiment Strategy: Professional Market Sentiment for Omron only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 27 (better than 27% compared with alternatives), overall professional sentiment and engagement for the stock Omron is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Omron. Analyst Opinions are at a rank of 34 (worse than 66% 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 81, which means that stock research experts have found something to make them more positive about investing in the company. In other words, they are getting more optimistic of stock investments in Omron. But the Professional Investors rank is low at 19, which means that professional investors hold less stock in this company than in 81% of alternative investment opportunities. Pros tend to invest in other companies. Market Pulse is also low at a rank of 13, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 87% of competitors). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 27 (less encouraging than 73% compared with investment alternatives), Omron has a reputation among professional investors that is below that of its competitors. These are quite a few negative sentiment signals. One may want to trust the analysts that are changing their opinions. They may be early indications of better times, especially if the company is a smaller one. But If they are an extra large company, they should have more professional stockholders than are currently present. ...read more
Value Strategy: Omron Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 7 (worse than 93% compared with alternatives), Omron shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Omron. Price-to-Sales is 27 which means that the stock price compared with what market professionals expect for future profits is higher than 73% of comparable companies, indicating a low value concerning Omron's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 31, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Omron. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 6 and Dividend Yield, which is lower than 82% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 7, is a SELL recommendation based on Omron's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Omron? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Omron? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Omron may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. ...read more
Growth Strategy: Omron Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 53 (better than 53% compared with alternatives), Omron 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 all but one indicator above average for Omron. Profit Growth has a rank of 50 which means that currently professionals expect the company to grow its profits more than 50% of its competitors. The same is valid for capital growth and stock returns. Capital Growth has a rank of 61, and Stock Returns has a rank of 65 which means that the stock returns have recently been above 65% of alternative investments. Only revenue growth is low with a Sales Growth has a rank of 31 (69% of its competitors are better). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 53, is a BUY recommendation for growth and momentum investors. The many positive growth indicators indicate a positive growth momentum with only low revenue growth. That can also be attributed to divestments or the sale of unprofitable businesses. If that is the reason, overall growth is well on track to making this stock attractive for growth investors. ...read more
Safety Strategy: Omron Debt Financing Safety very solid
| SAFETY METRICS | June 22, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 100 |
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| REFINANCING | ||||||||
| REFINANCING | 29 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 95 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 97 |
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ANALYSIS: With an Obermatt Safety Rank of 97 (better than 97% compared with alternatives) for 2022, the company Omron has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Omron 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 Omron. Leverage is at a rank of 100, meaning the company has a below-average debt-to-equity ratio. It has less debt than 100% of its competitors. Liquidity is also good at a rank of 95, meaning the company generates more profit to service its debt than 95% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 29, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 71% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 97 (better than 97% compared with alternatives), Omron has a financing structure that is significantly safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Omron. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. ...read more
Combined financial peformance: Omron Below-Average Financial Performance
| COMBINED PERFORMANCE | June 22, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 7 |
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| GROWTH | ||||||||
| GROWTH | 53 |
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| SAFETY | ||||||||
| SAFETY | 95 |
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| COMBINED | ||||||||
| COMBINED | 27 |
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ANALYSIS: With an Obermatt Combined Rank of 27 (worse than 73% compared with investment alternatives), Omron (Electronic Components, Japan) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Omron are low in value (priced high) with a consolidated Obermatt Value Rank of 7 (worse than 93% of alternatives). But they show above-average growth (Growth Rank of 53) and are safely financed (Safety Rank of 97, which means below-average debt burdens). ...read more
RECOMMENDATION: An Obermatt Combined Rank of 27, is a hold recommendation based on Omron's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Omron exhibits low value (Obermatt Value Rank of 7), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 53). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 97) 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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