Fact based stock research
Reckitt Benckiser (LSE:RB.)

GB00B24CGK77

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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).

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Reckitt Benckiser stock research in summary

reckitt.com

ANALYSIS: With an Obermatt Combined Rank of 1 (worse than 99% compared with investment alternatives), Reckitt Benckiser (Household Products, United Kingdom) shares have lower financial characteristics compared with similar stocks. Shares of Reckitt Benckiser are low in value (priced high) with a consolidated Value Rank of 32 (worse than 68% of alternatives), show below-average growth (Growth Rank of 15), and are riskily financed (Safety Rank of 13), which means above-average debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 1, is a sell recommendation based on Reckitt Benckiser's financial characteristics. As the company Reckitt Benckiser's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 32), low growth (Obermatt Growth Rank of 15), and risky financing practices (Obermatt Safety Rank of 13), 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	32
Growth Rank	15
Safety Rank	13
Combined Rank	1

Country	United Kingdom
Industry	Household Products
Index	FTSE All Shares, FTSE 100, FTSE 350, Dividends Europe, Employee Focus EU, Diversity Europe, Human Rights, Renewables Users, Water Tech
Size class	XX-Large

This stock has achievements: Top 10 Stock.

14-Nov-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: Reckitt Benckiser

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	20	47	45	32
GROWTH
GROWTH	16	7	33	15
SAFETY
SAFETY	5	4	10	13
SENTIMENT
SENTIMENT	n/a	97	30	^new
360° VIEW
360° VIEW	n/a	25	4	^new

Most recent update of the stock research: 14-Nov-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 Reckitt Benckiser is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	20	47	45	32
GROWTH
GROWTH	16	7	33	15
SAFETY
SAFETY	5	4	10	13
COMBINED
COMBINED	18	4	4	1

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Reckitt Benckiser the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 32 (worse than 68% compared with alternatives), Reckitt Benckiser shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for Reckitt Benckiser. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 82% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 27 which means that the stock price compared with what market professionals expect for future profits is higher than 73% of comparable companies, indicating a low value concerning Reckitt Benckiser's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 40 which means that the stock price compared with what market professionals expect for future profit levels is higher than 60% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 15 is also low. Compared with invested capital, the stock price is higher than for 85% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 32, is a hold recommendation based on Reckitt Benckiser's stock price compared with the company's operational size and dividend yields. Should dividend investors pick Reckitt Benckiser? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose Reckitt Benckiser only if they reasonably expect the low current profit levels to be transitory. 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 essential 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)	27	42	28	27
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	2	46	45	40
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	19	25	19	15
DIVIDEND YIELD
DIVIDEND YIELD	78	76	82	82
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	20	47	45	32

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Reckitt Benckiser; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 15 (better than 15% compared with alternatives), Reckitt Benckiser 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 three out of four indicators below average for Reckitt Benckiser. Only Capital Growth has a good rank of 53, which means that currently professionals expect the company to grow its invested capital more than 31% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 21 which means that currently professionals expect the company to grow less than 79% of its competitors. Profit Growth with a rank of 31 and Stock Returns with a rank of 29 are also low (below 71% of alternative investments). ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 15, is a sell recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Reckitt Benckiser is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. 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 limited here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	14	14	22	21
PROFIT GROWTH
PROFIT GROWTH	87	19	38	31
CAPITAL GROWTH
CAPITAL GROWTH	n/a	40	70	53
STOCK RETURNS
STOCK RETURNS	48	33	43	29
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	16	7	33	15

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Reckitt Benckiser.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 13 (better than 13% compared with alternatives), the company Reckitt Benckiser 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 Reckitt Benckiser 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 Reckitt Benckiser. Liquidity is at 60, meaning the company generates more profit to service its debt than 60% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 8, 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 92% of its competitors. Leverage is also high at a rank of 18, which means that the company has an above-average debt-to-equity ratio. It has more debt than 82% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 13 (worse than 87% compared with alternatives), Reckitt Benckiser 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. If the company is sailing with good winds, as may be visible from the Growth and Sentiment performance, the refinancing risk may be lower than the low Refinancing rank suggests. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	23	11	14	18
REFINANCING
REFINANCING	9	1	5	8
LIQUIDITY
LIQUIDITY	74	54	50	60
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	5	4	10	13

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Reckitt Benckiser 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	53	32	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	47	6	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	97	46	^new
MARKET PULSE
MARKET PULSE	n/a	82	83	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	97	30	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Reckitt Benckiser.
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