January 2, 2025
Top 10 Stock RingCentral 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: RingCentral – Top 10 Stock in Dow Jones U.S. Telecommunications Index
RingCentral is listed as a top 10 stock on January 02, 2025 in the market index D.J. US Telecom because of its high performance in at least one of the Obermatt investment strategies. Only the Obermatt Value Rank exhibits above-average performance, which means that the stock is seen as critical by the professional community and other financial facts are below average, conveying mixed investment signals. Based on the Obermatt 360° View of 26 (26% performer), Obermatt assesses an overall hold recommendation for RingCentral on January 02, 2025.
Snapshot: Obermatt Ranks
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 RingCentral Hold
| 360 METRICS | January 2, 2025 | |||||||
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| VALUE | ||||||||
| VALUE | 93 |
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| GROWTH | ||||||||
| GROWTH | 23 |
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| SAFETY | ||||||||
| SAFETY | 7 |
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| SENTIMENT | ||||||||
| SENTIMENT | 31 |
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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 RingCentral are below the industry average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for RingCentral. Only the consolidated Value Rank has an attractive rank of 93, which means that the share price of RingCentral is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 93% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 23, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. The consolidated Safety Rank has a riskier rank of 7, meaning the company has a riskier financing structure than 93% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, professionals are more pessimistic about the stock than for 69% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 31. ...read more
RECOMMENDATION: With a consolidated 360° View of 26, RingCentral is worse than 74% of all alternative stock investment opportunities based on the Obermatt Method. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 93. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 23), a riskier financing structure than the competition (Safety Rank of 7), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 31) is negative. This combination is sensitive to a crisis, because high debt levels (low safety) require growth to finance the debt burden. It’s no wonder that the investor community indicators are skeptical (low sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. We recommend evaluating whether the future of RingCentral is as challenging as the low price of the stock suggests. Since the professional community is pessimistic, you might need to worry about the future of RingCentral. Only invest if you have solid reasons to believe that the low growth is temporary and the current market sentiment is an overreaction, possibly due to reputational issues in the past. ...read more
Sentiment Strategy: Professional Market Sentiment for RingCentral only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 31 (better than 31% compared with alternatives), overall professional sentiment and engagement for the stock RingCentral is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for RingCentral. Analyst Opinions are at a rank of 23 (worse than 77% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 50, which means that stock research experts are more positive in their investment recommendations in the company. In other words, they are getting more optimistic of stock investments in RingCentral. More encouragingly, the Professional Investors rank is 61, which means that professional investors hold more stock in this company than in 61% of alternative investment opportunities. Pros tend to favor investing in this company. But Market Pulse is on the lower side with a rank of 38, which means that the current professional news and professional social networks are on the negative side when discussing this company (more negative news than for 62% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 31 (less encouraging than 69% compared with investment alternatives), RingCentral has a reputation among professional investors that is below that of its competitors. The sentiment signals are mixed for RingCentral. While analysts and the news channels are negative, there is a change in what analysts think. Above-average institutional investors in this company support them. Sentiment signals remain mixed with analysts and news channels pessimistic, though improving, and professional investors above average. ...read more
Value Strategy: RingCentral Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 93 (better than 93% compared with alternatives) for 2025, RingCentral shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for RingCentral. Price-to-Sales (P/S) is 80, which means that the stock price compared with what market professionals expect for future sales is lower than for 80% of comparable companies, indicating a good value regarding RingCentral's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 95% of alternatives, and it's also true for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 97. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 1% of all competitors have even lower dividend yields than RingCentral (a Dividend Yield Rank of 1). 99% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 93, is a buy recommendation based on RingCentral's stock price compared with the company's operational size and dividend yields. The below-average dividend yield may be a good sign, as it could mean the company has more attractive investment opportunities for the generated cash than to pay it out as dividends. A low dividend yield can also indicate a growth phase. ...read more
Growth Strategy: RingCentral Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 23 (better than 23% compared with alternatives), RingCentral 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 RingCentral. Sales Growth has a rank of 36, which means that currently professionals expect the company to grow less than 64% of its competitors. The same is valid for Profit Growth, with a rank of 32, and Capital Growth with 44. In addition, Stock Returns have a below market rank of 49, which means that the stock returns have recently been below 51% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 23, 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: RingCentral Debt Financing Safety risky
| SAFETY METRICS | January 2, 2025 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 1 |
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| REFINANCING | ||||||||
| REFINANCING | 37 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 30 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 7 |
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ANALYSIS: With an Obermatt Safety Rank of 7 (better than 7% compared with alternatives), the company RingCentral 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 RingCentral 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 all three metrics below average for RingCentral. Liquidity is at 30, meaning that the company generates less profit to service its debt than 70% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 1, meaning the company has an above-average debt-to-equity ratio. It has more debt than 99% of its competitors. Finally, Refinancing is at a rank of 37 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 63% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 7 (worse than 93% compared with alternatives), RingCentral has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing.
Combined financial peformance: RingCentral Below-Average Financial Performance
| COMBINED PERFORMANCE | January 2, 2025 | |||||||
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| VALUE | ||||||||
| VALUE | 93 |
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| GROWTH | ||||||||
| GROWTH | 23 |
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| SAFETY | ||||||||
| SAFETY | 30 |
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| COMBINED | ||||||||
| COMBINED | 26 |
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ANALYSIS: With an Obermatt Combined Rank of 26 (worse than 74% compared with investment alternatives), RingCentral (Application Software, USA) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of RingCentral are a good value (attractively priced) with a consolidated Value Rank of 93 (better than 93% of alternatives) but show below-average growth (Growth Rank of 23), and are riskily financed (Safety Rank of 7), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 26, is a hold recommendation based on RingCentral's financial characteristics. As the company RingCentral's key financial metrics exhibit good value (Obermatt Value Rank of 93) but low growth (Obermatt Growth Rank of 23) and risky financing practices (Obermatt Safety Rank of 7), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 93% of comparable companies, may indicate 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. ...read more
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