Fact based stock research
Richelieu Hardware (TSX:RCH)

CA76329W1032

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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:
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Growth - shows a company's growth potential. Green is "high growth" expected; red is "tough times ahead".

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Richelieu Hardware stock research in summary

richelieu.com

ANALYSIS: With an Obermatt Combined Rank of 27 (worse than 73% compared with investment alternatives), Richelieu Hardware (Trading & Distribution, Canada) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Richelieu Hardware are low in value (priced high) with a consolidated Value Rank of 27 (worse than 73% of alternatives) and show below-average growth (Growth Rank of 23) but are safely financed (Safety Rank of 74), which means low debt burdens. ...read more

RECOMMENDATION: A Combined Rank of 27, is a hold recommendation based on Richelieu Hardware's financial characteristics. As the company Richelieu Hardware's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 27) and low growth (Obermatt Growth Rank of 23), 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. In this case, good financing practices (Obermatt Safety Rank of 74) are a positive sign, because it may allow the company to weather challenging times until the hoped-for cash flows materialize. This may be true for high-tech or biotechnology companies with enough cash to sustain prolonged business development. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and unattractive today. In such cases, the Obermatt Method has limited value, as it is based on facts we can observe today. If the facts lie all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that account for 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	n/a
Growth Rank	n/a
Safety Rank	n/a
Combined Rank	n/a

Country	Canada
Industry	Trading & Distribution
Index	TSX Composite
Size class	Large

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Research History: Richelieu Hardware

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	34	19	27	n/a
GROWTH
GROWTH	78	35	31	n/a
SAFETY
SAFETY	86	93	79	n/a
SENTIMENT
SENTIMENT	n/a	76	82	^new
360° VIEW
360° VIEW	n/a	58	70	^new

Most recent update of the stock research: . Financial reporting date used for calculating ranks: . Stock research history is based on the Obermatt Method. The higher the rank, the better Richelieu Hardware is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	34	19	27	n/a
GROWTH
GROWTH	78	35	31	n/a
SAFETY
SAFETY	86	93	79	n/a
COMBINED
COMBINED	83	47	32	n/a

Last update of combined financial performance: . Stock analysis on combined financial performance: The higher the rank of Richelieu Hardware the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 27 (worse than 73% compared with alternatives), Richelieu Hardware shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Richelieu Hardware. Expected dividend yields are higher than for 63% of comparable companies (a Dividend Yield rank of 63), 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 50, which means that the stock price is lower compared with invested capital than for 50% of comparable investments. But in respect to sales and profits, the picture is reversed. Price-to-Sales is 28 which means that the stock price compared with what market professionals expect for future profits is higher than for 72% of comparable companies, indicating a low value concerning Richelieu Hardware's sales levels. The Price-to-Profit ratio (also referred to as price-earnings (P/E) ratio) is also unfavorable for Richelieu Hardware with a rank of 24. This means that the stock price, compared with what market professionals expect for future profits, is higher than for 76% of comparable companies, indicating a low value concerning Richelieu Hardware's profit levels. ...read more

RECOMMENDATION: The overall picture with a consolidated Value Rank of 27, is a hold recommendation based on Richelieu Hardware'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, Richelieu Hardware 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. 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)	33	30	34	n/a
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	53	28	22	n/a
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	22	35	48	n/a
DIVIDEND YIELD
DIVIDEND YIELD	41	59	54	n/a
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	34	19	27	n/a

Last update of Value Rank: . Stock analysis on value ratios: The higher the rank, the lower the value ratio of Richelieu Hardware; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 23 (better than 23% compared with alternatives), Richelieu Hardware 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 half of the indicators below and half above average for Richelieu Hardware. Capital Growth has a rank of 83, which means that currently professionals expect the company to grow its invested capital more than 18% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 53 (above 53% of alternative investments). But Sales Growth has only a rank of 6, which means that, currently, professionals expect the company to grow less than 94% of its competitors, and Profit Growth is also low at a rank of 18. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 23, is a sell 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 Richelieu Hardware, investors may want to look at value and sentiment indicators for a well-rounded picture of this 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 mixed here. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	61	51	6	n/a
PROFIT GROWTH
PROFIT GROWTH	n/a	54	21	n/a
CAPITAL GROWTH
CAPITAL GROWTH	n/a	34	85	n/a
STOCK RETURNS
STOCK RETURNS	58	51	57	n/a
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	78	35	31	n/a

Last update of Growth Rank: . Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Richelieu Hardware.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 74 (better than 74% compared with alternatives), the company Richelieu Hardware 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 Richelieu Hardware 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 Richelieu Hardware. Leverage is at a rank of 66, meaning the company has a below-average debt-to-equity ratio. It has less debt than 66% of its competitors. Liquidity is also good at a rank of 88, meaning the company generates more profit to service its debt than 88% 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 45, 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 55% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 74 (better than 74% compared with alternatives), Richelieu Hardware 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 Richelieu Hardware. 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. Investors may have a short-term debt challenge with Richelieu Hardware and should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	68	80	68	n/a
REFINANCING
REFINANCING	56	40	45	n/a
LIQUIDITY
LIQUIDITY	89	97	86	n/a
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	86	93	79	n/a

Last update of Safety Rank: . Stock analysis on safety metrics: The higher the rank, the lower the leverage of Richelieu Hardware 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	21	39	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	50	50	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	74	86	^new
MARKET PULSE
MARKET PULSE	n/a	96	91	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	76	82	^new

Last update of Sentiment Rank: . Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Richelieu Hardware.
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