September 5, 2024
Top 10 Stock Pets at Home 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: Pets at Home – Top 10 Stock in FTSE 350 Index
Pets at Home is listed as a top 10 stock on September 05, 2024 in the market index FTSE 350 because of its high performance in at least one of the Obermatt investment strategies. As three out of four consolidated Obermatt Ranks exhibit excellent performance, it is a solid investment where the risk of paying too much for the shares is low, despite a currently slow growth momentum. Based on the Obermatt 360° View of 70 (high 70% performer), Obermatt assesses an overall buy recommendation for Pets at Home on September 05, 2024.
Snapshot: Obermatt Ranks
| Country | United Kingdom |
| Industry | Specialty Stores |
| Index | FTSE All Shares, FTSE 250, FTSE 350, Dividends Europe, Employee Focus EU |
| Size class | 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 Pets at Home Buy
| 360 METRICS | September 5, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 55 |
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| GROWTH | ||||||||
| GROWTH | 22 |
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| SAFETY | ||||||||
| SAFETY | 68 |
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| SENTIMENT | ||||||||
| SENTIMENT | 97 |
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| 360° VIEW | ||||||||
| 360° VIEW | 70 |
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ANALYSIS: With an Obermatt 360° View of 70 (better than 70% compared with alternatives), overall professional sentiment and financial characteristics for the stock Pets at Home are above average. The 360° View is based on consolidating four consolidated indicators, with half of the indicators below and half above average for Pets at Home. The consolidated Value Rank has an attractive rank of 55, which means that the share price of Pets at Home is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 55% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 68. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 97. But the consolidated Growth Rank has a low rank of 22, which means that the company is below average in terms of growth and momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. 78 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 70, Pets at Home is better positioned than 70% of all alternative stock investment opportunities based on the Obermatt Method. Three out of four consolidated Obermatt Ranks show above-average performance. The stock has as good value (Value Rank of 55), secure financing practices (Safety Rank of 68), and positive market sentiment in the professional investor community (Sentiment Rank of 97). It is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely to occur. The company’s growth expectations are below the industry average (Growth Rank of 22), but that could also be temporary since professional investors remain optimistic despite the low growth numbers. The low price as reflected in the good Value Rank could indicate that the company's future is challenging. The below-par growth performance may be the reason for this. Companies that grow less are typically cheaper than fast-growing competitors. We recommend evaluating whether the future of Pets at Home is as difficult as the stock’s low price suggests, despite the positive professional investor sentiment. Since the professional community is optimistic, you might have less to worry about, and the stock may just go through a more challenging phase now, indicating good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for Pets at Home very positive
ANALYSIS: With an Obermatt Sentiment Rank of 97 (better than 97% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Pets at Home is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all four indicators above average for Pets at Home. Analyst Opinions are at a rank of 78 (better than 78% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive with a rank of 60, which means that stock research experts are changing their opinions for the better and recommending investing in the company. They are getting more optimistic about stock investments in Pets at Home. The Professional Investors rank is 87, which means that currently, professional investors hold more stock in this company than in 87% of alternative investment opportunities. Pros tend to favor investing in this company. Finally, Market Pulse has a rank of 88 which means that the current professional news and professional social networks are on the positive side when discussing this company (more positive news than for 88% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 97 (more positive than 97% compared with investment alternatives), Pets at Home has a reputation among professional investors that is significantly higher than that of its competitors. Since all market sentiment indicators are positive, the professional community highly recommends investment in the company. Does this mean Pets at Home stocks are a safe investment? Far from it. Even professionals make mistakes. Especially in stock investing, there is a tendency to follow the leaders. Since trees don't grow to the heavens, such positive sentiment may also be interpreted as a danger sign. A lot of optimism can often be a sign of troubles to come, albeit unforeseen by most. ...read more
Value Strategy: Pets at Home Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 55 (better than 55% compared with alternatives), Pets at Home 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 Pets at Home. Expected dividend yields are higher than for 82% of comparable companies (a Dividend Yield rank of 82), making the stock attractive. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 51, which means that the stock price is lower compared with invested capital than for 51% of comparable investments. But in respect to sales and profits, the picture is reversed. Price-to-Sales is 17 which means that the stock price compared with what market professionals expect for future profits is higher than for 83% of comparable companies, indicating a low value concerning Pets at Home's sales levels. The Price-to-Profit ratio (also referred to as price-earnings (P/E) ratio) is also unfavorable for Pets at Home with a rank of 44. This means that the stock price, compared with what market professionals expect for future profits, is higher than for 56% of comparable companies, indicating a low value concerning Pets at Home's profit levels. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 55, is a buy recommendation based on Pets at Home's stock price compared with the company's operational size and dividend yields. The company seems confident that it can generate a reasonable return on invested capital, because it pays an above-average dividend while profits are below what you would expect for a company with this stock price. If you agree with this practice and believe that profits will return to higher levels, as the current dividend policy suggests, Pets at Home may be an attractive investment. If this is not the case, you may want to be careful with this stock as it is also expensive compared with its expected revenue levels. ...read more
Growth Strategy: Pets at Home Growth Momentum negative
| GROWTH METRICS | September 5, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 44 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 38 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 19 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 41 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 22 |
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ANALYSIS: With an Obermatt Growth Rank of 22 (better than 22% compared with alternatives), Pets at Home 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 Pets at Home. Sales Growth has a rank of 44, which means that currently professionals expect the company to grow less than 56% of its competitors. The same is valid for Profit Growth, with a rank of 38, and Capital Growth with 19. In addition, Stock Returns have a below market rank of 41, which means that the stock returns have recently been below 59% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 22, 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. ...read more
Safety Strategy: Pets at Home Debt Financing Safety above-average
| SAFETY METRICS | September 5, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 76 |
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| REFINANCING | ||||||||
| REFINANCING | 23 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 82 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 68 |
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ANALYSIS: With an Obermatt Safety Rank of 68 (better than 68% compared with alternatives), the company Pets at Home 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 Pets at Home 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 Pets at Home. Leverage is at a rank of 76, meaning the company has a below-average debt-to-equity ratio. It has less debt than 76% of its competitors. Liquidity is also good at a rank of 82, meaning the company generates more profit to service its debt than 82% 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 23, 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 77% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 68 (better than 68% compared with alternatives), Pets at Home has a financing structure that is 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 Pets at Home. 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: Pets at Home Below-Average Financial Performance
| COMBINED PERFORMANCE | September 5, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 55 |
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| GROWTH | ||||||||
| GROWTH | 22 |
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| SAFETY | ||||||||
| SAFETY | 82 |
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| COMBINED | ||||||||
| COMBINED | 43 |
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ANALYSIS: With an Obermatt Combined Rank of 43 (worse than 57% compared with investment alternatives), Pets at Home (Specialty Stores, United Kingdom) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Pets at Home are a good value (attractively priced) with a consolidated Value Rank of 55 (better than 55% of alternatives), are safely financed (Safety Rank of 68, which means low debt burdens), but show below-average growth (Growth Rank of 22). ...read more
RECOMMENDATION: A Combined Rank of 43, is a hold recommendation based on Pets at Home's financial characteristics. As the company Pets at Home's key financial metrics exhibit good value (Obermatt Value Rank of 55) but low growth (Obermatt Growth Rank of 22) while being safely financed (Obermatt Safety Rank of 68), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 55% of comparable companies, may also indicate that 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 and the downside is limited due to below-average financing risks. ...read more
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