July 18, 2024
Top 10 Stock Prudential Financial 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: Prudential Financial – Top 10 Stock in Dow Jones U.S. Insurance Index
Prudential Financial is listed as a top 10 stock on July 18, 2024 in the market index D.J. US Insurance because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 26 (26% performer), Obermatt assesses an overall hold recommendation for Prudential Financial on July 18, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Life & Health Insurance |
| Index | Dividends USA, Diversity USA, SDG 11, SDG 7, D.J. US Insurance, S&P 500 |
| 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 Prudential Financial Hold
| 360 METRICS | July 18, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 90 |
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| GROWTH | ||||||||
| GROWTH | 35 |
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| SAFETY | ||||||||
| SAFETY | 60 |
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| SENTIMENT | ||||||||
| SENTIMENT | 24 |
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| 360° VIEW | ||||||||
| 360° VIEW | 26 |
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ANALYSIS: With an Obermatt 360° View of 26 (better than 26% compared with alternatives), overall professional sentiment and financial characteristics for the stock Prudential Financial are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Prudential Financial. The consolidated Value Rank has an attractive rank of 90, which means that the share price of Prudential Financial 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 90% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 60. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 24. Professional investors are more confident in 76% other stocks. The consolidated Growth Rank also has a low rank of 35, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 65 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 26, Prudential Financial is worse than 74% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 90), and the financing structure is on the safer side (Safety Rank of 60). However, sentiment in the professional investor community is below-average (Sentiment Rank of 24), as is the growth momentum for the company (Growth Rank of 35). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for Prudential Financial negative
ANALYSIS: With an Obermatt Sentiment Rank of 24 (better than 24% compared with alternatives), overall professional sentiment and engagement for the stock Prudential Financial is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half the indicators below and the other half above average for Prudential Financial. Analyst Opinions are at a rank of 15 (worse than 85% 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 17, 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 45, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 55% 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 24 (less encouraging than 76% compared with investment alternatives), Prudential Financial has a reputation among professional investors that is far below that of its competitors. Should the company be on the smaller side, the presence of professional investors could be reassuring. That would make Prudential Financial 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: Prudential Financial Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 90 (better than 90% compared with alternatives) for 2022, Prudential Financial shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Prudential Financial. Price-to-Sales is 67 which means that the stock price compared with what market professionals expect for future sales is lower than for 67% of comparable companies, indicating a good value for Prudential Financial's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 74% 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 66. Compared with other companies in the same industry, dividend yields of Prudential Financial are expected to be higher than for 88% of all competitors (a Dividend Yield rank of 88). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 90, is a buy recommendation based on Prudential Financial'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 Prudential Financial based on its detailed value metrics.
Growth Strategy: Prudential Financial Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 35 (better than 35% compared with alternatives), Prudential Financial 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 Prudential Financial. Profit Growth has a rank of 58, which means that currently professionals expect the company to grow its profits more than 58% of its competitors. This is a good sign for shareholders, which is confirmed by an above-average Stock Returns rank of 78 (above 78% of alternative investments). But Sales Growth has a below the median rank of 1, which means that, currently, professionals expect the company to grow less than 99% of its competitors, and Capital Growth also has a lower rank of 13. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 35, is a hold recommendation for growth and momentum investors. Because revenues and invested capital are the more solid growth indicators, the positive development on the profit side is less relevant. It may have been caused by cost-cutting, which may be a negative growth indicator. Finally, the above-average stock returns recently are a thing of the past and not a good indicator of future returns. Investors should be confident that the cost-cutting initiative leading to higher profits is to benefit the company's future. If not, there is little growth momentum, and investment is only advisable if the Value Ranks suggest a good investment timing for Prudential Financial. ...read more
Safety Strategy: Prudential Financial Debt Financing Safety above-average
| SAFETY METRICS | July 18, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 28 |
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| REFINANCING | ||||||||
| REFINANCING | 36 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 70 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 60 |
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ANALYSIS: With an Obermatt Safety Rank of 60 (better than 60% compared with alternatives), the company Prudential Financial 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 Prudential Financial 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 just one indicator above average for Prudential Financial. 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 36, 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 64% of its competitors. Leverage is also high at a rank of 28, which means that the company has an above-average debt-to-equity ratio. It has more debt than 72% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 60 (better than 60% compared with alternatives), Prudential Financial has a financing structure that is safer 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: Prudential Financial Above-Average Financial Performance
| COMBINED PERFORMANCE | July 18, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 90 |
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| GROWTH | ||||||||
| GROWTH | 35 |
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| SAFETY | ||||||||
| SAFETY | 70 |
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| COMBINED | ||||||||
| COMBINED | 69 |
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ANALYSIS: With an Obermatt Combined Rank of 69 (better than 69% compared with investment alternatives), Prudential Financial (Life & Health Insurance, USA) shares have above-average financial characteristics compared with similar stocks. Shares of Prudential Financial are a good value (attractively priced) with a consolidated Value Rank of 90 (better than 90% of alternatives), are safely financed (Safety Rank of 60, which means low debt burdens), but show below-average growth (Growth Rank of 35). ...read more
RECOMMENDATION: A Combined Rank of 69, is a buy recommendation based on Prudential Financial's financial characteristics. As the company Prudential Financial's key financial metrics exhibit good value (Obermatt Value Rank of 90) but low growth (Obermatt Growth Rank of 35) while being safely financed (Obermatt Safety Rank of 60), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 90% 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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