March 28, 2024
Top 10 Stock Petrobras Hold 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: Petrobras – Top 10 Stock in Bolsa de Valores-Mercadorias | BOVESPA
Petrobras is listed as a top 10 stock on March 28, 2024 in the market index BOVESPA because of its high performance in at least one of the Obermatt investment strategies. Only the Obermatt Value Rank exhibits above-average performance, which means that the stock is seen as critical by the professional community and other financial facts are below average, conveying mixed investment signals. Based on the Obermatt 360° View of 27 (27% performer), Obermatt assesses an overall hold recommendation for Petrobras on March 28, 2024.
Snapshot: Obermatt Ranks
| Country | Brazil |
| Industry | Oil & Gas Integrated |
| Index | BOVESPA, BOVESPA, Low Emissions, Energy Efficient, Good Governace Growth Markets, Human Rights, Water Efficiency |
| 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 Petrobras Hold
| 360 METRICS | March 28, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 91 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 41 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 23 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 27 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 27 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 27 (better than 27% compared with alternatives), overall professional sentiment and financial characteristics for the stock Petrobras are below the industry average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Petrobras. Only the consolidated Value Rank has an attractive rank of 91, which means that the share price of Petrobras is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 91% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 41, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. The consolidated Safety Rank has a riskier rank of 23, meaning the company has a riskier financing structure than 77% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, professionals are more pessimistic about the stock than for 73% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 27. ...read more
RECOMMENDATION: With a consolidated 360° View of 27, Petrobras is worse than 73% of all alternative stock investment opportunities based on the Obermatt Method. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 91. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 41), a riskier financing structure than the competition (Safety Rank of 23), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 27) is negative. This combination is sensitive to a crisis, because high debt levels (low safety) require growth to finance the debt burden. It’s no wonder that the investor community indicators are skeptical (low sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. We recommend evaluating whether the future of Petrobras is as challenging as the low price of the stock suggests. Since the professional community is pessimistic, you might need to worry about the future of Petrobras. Only invest if you have solid reasons to believe that the low growth is temporary and the current market sentiment is an overreaction, possibly due to reputational issues in the past. ...read more
Sentiment Strategy: Professional Market Sentiment for Petrobras only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 27 (better than 27% compared with alternatives), overall professional sentiment and engagement for the stock Petrobras is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half the indicators below and the other half above average for Petrobras. Analyst Opinions are at a rank of 42 (worse than 58% 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 35, which means that stock research experts are getting more pessimistic. It doesn't end with the analysts. Market Pulse is also low with a rank of 44, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 56% of competitors). On the upside, the Professional Investors rank is 53, which means that professional investors hold more stock in this company than in 53% of alternative investment opportunities. Pros tend to favor investing in this company. This could be due to a large company size, which could contribute to the higher share of professional investors in the company. If this is not the case, the low sentiment ranks are more challenging to explain. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 27 (less encouraging than 73% compared with investment alternatives), Petrobras has a reputation among professional investors that is below that of its competitors. Should the company be on the smaller side, the presence of professional investors could be reassuring. That would make Petrobras stock something like a hidden gem. Investors should make sure with further research that this is true, because all other sentiment indicators are negative which is a sign for caution. ...read more
Value Strategy: Petrobras Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 91 (better than 91% compared with alternatives) for 2024, Petrobras shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Petrobras. Price-to-Sales is 59 which means that the stock price compared with what market professionals expect for future sales is lower than for 59% of comparable companies, indicating a good value for Petrobras's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 100% 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 91. Compared with other companies in the same industry, dividend yields of Petrobras are expected to be higher than for 98% of all competitors (a Dividend Yield rank of 98). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 91, is a buy recommendation based on Petrobras'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 Petrobras based on its detailed value metrics.
Growth Strategy: Petrobras Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 41 (better than 41% compared with alternatives), Petrobras shows a below-average growth dynamic in its industry. There is limited momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Petrobras. Capital Growth has a rank of 67, which means that currently professionals expect the company to grow its invested capital more than 25% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 89 (above 89% of alternative investments). But Sales Growth has only a rank of 9, which means that, currently, professionals expect the company to grow less than 91% of its competitors, and Profit Growth is also low at a rank of 25. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 41, is a hold recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for Petrobras, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. ...read more
Safety Strategy: Petrobras Debt Financing Safety risky
| SAFETY METRICS | March 28, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 31 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 12 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 70 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 23 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 23 (better than 23% compared with alternatives), the company Petrobras has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Petrobras 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 just one indicator above average for Petrobras. Liquidity is at 70, meaning the company generates more profit to service its debt than 70% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 12, 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 88% of its competitors. Leverage is also high at a rank of 31, which means that the company has an above-average debt-to-equity ratio. It has more debt than 69% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 23 (worse than 77% compared with alternatives), Petrobras has a financing structure that is significantly riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. ...read more
Combined financial peformance: Petrobras Below-Average Financial Performance
| COMBINED PERFORMANCE | March 28, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 91 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 41 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 70 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 42 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 42 (worse than 58% compared with investment alternatives), Petrobras (Oil & Gas Integrated, Brazil) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Petrobras are a good value (attractively priced) with a consolidated Value Rank of 91 (better than 91% of alternatives) but show below-average growth (Growth Rank of 41), and are riskily financed (Safety Rank of 23), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 42, is a hold recommendation based on Petrobras's financial characteristics. As the company Petrobras's key financial metrics exhibit good value (Obermatt Value Rank of 91) but low growth (Obermatt Growth Rank of 41) and risky financing practices (Obermatt Safety Rank of 23), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 91% 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. ...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.