Fact based stock research
Pernod Ricard (ENXTPA:RI)

FR0000120693

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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.

Pernod Ricard stock research in summary

pernod-ricard.com

ANALYSIS: With an Obermatt Combined Rank of 9 (worse than 91% compared with investment alternatives), Pernod Ricard (Distillers & Vintners, France) shares have lower financial characteristics compared with similar stocks. Shares of Pernod Ricard are low in value (priced high) with a consolidated Value Rank of 43 (worse than 57% of alternatives), show below-average growth (Growth Rank of 5), and are riskily financed (Safety Rank of 49), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 9, is a sell recommendation based on Pernod Ricard's financial characteristics. As the company Pernod Ricard's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 43), low growth (Obermatt Growth Rank of 5), and risky financing practices (Obermatt Safety 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. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. 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	43
Growth Rank	5
Safety Rank	49
Combined Rank	9

Country	France
Industry	Distillers & Vintners
Index	EURO STOXX 50, CAC 40, CAC All, SBF 120, Diversity Europe, Recycling
Size class	XX-Large

19-Dec-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: Pernod Ricard

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	29	31	41	43
GROWTH
GROWTH	75	45	21	5
SAFETY
SAFETY	53	53	47	49
SENTIMENT
SENTIMENT	n/a	27	24	^new
360° VIEW
360° VIEW	n/a	13	10	^new

Most recent update of the stock research: 19-Dec-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Pernod Ricard is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	29	31	41	43
GROWTH
GROWTH	75	45	21	5
SAFETY
SAFETY	53	53	47	49
COMBINED
COMBINED	47	19	18	9

Last update of combined financial performance: 19-Dec-2024. Stock analysis on combined financial performance: The higher the rank of Pernod Ricard the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 43 (worse than 57% compared with alternatives), Pernod Ricard shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Pernod Ricard. Price-to-Profit (also referred to as price-earnings, P/E) is 51 which means that the stock price compared with what market professionals expect for future profits is lower than for 51% of comparable companies, indicating a good value concerning Pernod Ricard'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 46, which means that the stock price is lower as regards to invested capital than for 46% of comparable investments. On the other hand, Price-to-Sales is less favorable than 87% of alternatives (only 13% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 30% 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 43, is a hold recommendation based on Pernod Ricard'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)	19	16	15	13
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	26	29	65	51
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	32	39	38	46
DIVIDEND YIELD
DIVIDEND YIELD	60	41	47	70
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	29	31	41	43

Last update of Value Rank: 19-Dec-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Pernod Ricard; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 5 (better than 5% compared with alternatives), Pernod Ricard 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 all four metrics below average for Pernod Ricard. Sales Growth has a rank of 25, which means that currently professionals expect the company to grow less than 75% of its competitors. The same is valid for Profit Growth, with a rank of 28, and Capital Growth with 25. In addition, Stock Returns have a below market rank of 15, which means that the stock returns have recently been below 85% of alternative investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 5, is a sell recommendation for growth and momentum investors. These are all bad growth momentum indicators. These are negative signals for investors interested in growth companies. Value is likely good for this company, as investors may have left this stock in the cold. If that is the case, investors should look at the company's outlook, especially Sentiment performance, because it may be a turnaround situation that could entail above-average stock returns in the future. But it remains a risky bet, as no growth signals are in the green zone yet. 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 low here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	56	62	75	25
PROFIT GROWTH
PROFIT GROWTH	74	50	41	28
CAPITAL GROWTH
CAPITAL GROWTH	n/a	20	19	25
STOCK RETURNS
STOCK RETURNS	70	77	27	15
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	75	45	21	5

Last update of Growth Rank: 19-Dec-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Pernod Ricard.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 49 (better than 49% compared with alternatives), the company Pernod Ricard 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 Pernod Ricard 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 Pernod Ricard. Refinancing is at 61, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 61% of its competitors. Liquidity is also good at 54, meaning the company generates more profit to service its debt than 54% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 33, which means the company has an above-average debt-to-equity ratio. It has more debt than 67% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 49 (worse than 51% compared with alternatives), Pernod Ricard 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 Pernod Ricard 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 Pernod Ricard 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	51	50	32	33
REFINANCING
REFINANCING	37	53	51	61
LIQUIDITY
LIQUIDITY	63	51	61	54
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	53	53	47	49

Last update of Safety Rank: 19-Dec-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Pernod Ricard 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	40	27	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	8	11	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	33	32	^new
MARKET PULSE
MARKET PULSE	n/a	72	85	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	27	24	^new

Last update of Sentiment Rank: 19-Dec-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Pernod Ricard.
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