July 25, 2024
Top 10 Stock PPL Strong 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: PPL – Top 10 Stock in SDG 13: Climate Action
PPL is listed as a top 10 stock on July 25, 2024 in the market index SDG 13 because of its high performance in at least one of the Obermatt investment strategies. As all consolidated Obermatt Ranks exhibit excellent performance, including positive market sentiment in the professional investor community, it is a solid stock investment where the risk of paying too much for the shares is limited. Based on the Obermatt 360° View of 93 (top 93% performer), Obermatt assesses an overall strong buy recommendation for PPL on July 25, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Electric Utilities |
| Index | Low Emissions, Customer Focus US, SDG 13, SDG 6, SDG 7, SDG 8, SDG 9, S&P 500 |
| 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 PPL Strong Buy
| 360 METRICS | July 25, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 51 |
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| GROWTH | ||||||||
| GROWTH | 69 |
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| SAFETY | ||||||||
| SAFETY | 95 |
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| SENTIMENT | ||||||||
| SENTIMENT | 67 |
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| 360° VIEW | ||||||||
| 360° VIEW | 93 |
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ANALYSIS: With an Obermatt 360° View of 93 (better than 93% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock PPL are very positive. The 360° View is based on consolidating four consolidated indicators, with all four indicators above average for PPL. The consolidated Value Rank has an attractive rank of 51, which means that the share price of PPL is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 51% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 69, 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. The company is also safely financed with a Safety rank of 95. Finally, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 67. ...read more
RECOMMENDATION: With a consolidated 360° View of 93, PPL is better positioned than 93% of all alternative stock investment opportunities based on the Obermatt Method. As all consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 51), above-average growth (Growth Rank of 69), safe financing practices (Safety Rank of 95), and a positive market sentiment in the professional investor community (Sentiment Rank of 67), 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, unless information not publicly available. High-Value Ranks sometimes indicate that the company's future is challenging. If they are safely financed and have above average growth, and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of PPL is as difficult as the stock’s low price, despite what good growth and safe financing practice suggest. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible, which may indicate good timing right now. ...read more
Sentiment Strategy: Professional Market Sentiment for PPL positive
ANALYSIS: With an Obermatt Sentiment Rank of 67 (better than 67% compared with alternatives), overall professional sentiment and engagement for the stock PPL is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the indicators below and half above average for PPL. Analyst Opinions are at a rank of 88 (better than 88% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. Market Pulse is also positive with a rank of 56, which means that the current professional news and professional social networks are positive when discussing this company (more positive news than for 56% of competitors). But Analyst Opinions Change is negative with a below 50 rank of 46, which means that stock research experts are changing their opinions for the worse in recommending the company. In other words, they are getting more critical of investments in PPL. There are also only so many institutional investors holding company stock with a Professional Investors rank of 35, which means that, currently, professional investors hold less stock in this company than in 65% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 67 (more positive than 67% compared with investment alternatives), PPL has a reputation among professional investors that is above-average compared with that of its competitors. The signals are ambivalent. The positive news in the market contradicts the negative change in analyst recommendations. Since the overall analyst recommendations are still above average, the stock may be safer for investing, especially if it is not an extra-large company where Pros tend to be less present. In such a case, the Pro Investor rank is not a problem. ...read more
Value Strategy: PPL Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 51 (better than 51% compared with alternatives), PPL shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators where three out of four are below average for PPL. Only the Price-to-Book Capital ratio (also referred to as market-to-book ratio) indicates good stock value with a Price-to-Book Rank of 67, which means that the stock price is lower compared with invested capital than for 67% of comparable investments. All other value indicators are below the market median. Price-to-Sales is 32 which means the stock price compared with what market professionals expect for future profits is higher than 68% of comparable companies, indicating a low value concerning PPL's revenue levels. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Book Rank of 67 and for the dividend yields rank which is lower than for 53% of comparable companies, making the stock more expensive as regards to with the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 51, is a buy recommendation based on PPL's stock price compared with the company's operational size and dividend yields. Why are market participants paying such a high price for PPL, where three out of four value indicators are below par? One reason could be that the company is well financed, indicated by the high book capital level, and has a promising future that is not yet visible in reported revenues and profits. That would also explain the low dividend yield because the company needs the cash to invest in its future. If investors can verify a picture in this sense, the stock may still be a good investment, even though current company-reported financials don't fully explain current stock prices. ...read more
Growth Strategy: PPL Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 69 (better than 69% compared with alternatives), PPL 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 half of the indicators below and half above average for PPL. Capital Growth has a rank of 91, which means that currently professionals expect the company to grow its invested capital more than 48% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 77 (above 77% of alternative investments). But Sales Growth has only a rank of 17, which means that, currently, professionals expect the company to grow less than 83% of its competitors, and Profit Growth is also low at a rank of 48. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 69, is a buy 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 PPL, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. ...read more
Safety Strategy: PPL Debt Financing Safety very solid
| SAFETY METRICS | July 25, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 80 |
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| REFINANCING | ||||||||
| REFINANCING | 85 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 76 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 95 |
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ANALYSIS: With an Obermatt Safety Rank of 95 (better than 95% compared with alternatives) for 2024, the company PPL has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of PPL 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, where all three are above average for PPL. Leverage is at 80, meaning the company has a below-average debt-to-equity ratio. It has less debt than 80% of its competitors. Refinancing is at a rank of 85, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 85% of its competitors. Finally, Liquidity is also good at a rank of 76, which means that the company generates more profit to service its debt than 76% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 95 (better than 95% compared with alternatives), PPL has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more
Combined financial peformance: PPL Top Financial Performance
| COMBINED PERFORMANCE | July 25, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 51 |
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| GROWTH | ||||||||
| GROWTH | 69 |
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| SAFETY | ||||||||
| SAFETY | 76 |
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| COMBINED | ||||||||
| COMBINED | 97 |
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ANALYSIS: With an Obermatt Combined Rank of 97 (better than 97% compared with investment alternatives), PPL (Electric Utilities, USA) shares have much better financial characteristics than comparable stocks. Shares of PPL are a good value (attractively priced) with a consolidated Value Rank of 51 (better than 51% of alternatives), show above-average growth (Growth Rank of 69), and are safely financed (Safety Rank of 95), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 97, is a strong buy recommendation based on PPL's financial characteristics. As the company PPL's key financial metrics all exhibit excellent performance, such as good value (Obermatt Value Rank of 51), above-average growth (Obermatt Growth Rank of 69), and indicate that the company is safely financed (Obermatt Safety Rank of 95), it is a solid stock investment where the risk of paying too much for the share is limited, unless the company has a bleak future. Such good financial performance can indicate that the company's future might actually be challenging, as it may be difficult to maintain the good performance. If they are safely financed and have been growing above average, and are still a good value, it means that the market is keeping prices low, for a reason which may become clearer over time. We recommend evaluating the future of PPL. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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