September 26, 2024
Top 10 Stock Roche Sell 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: Roche – Top 10 Stock in Moonshot High Tech
Roche is listed as a top 10 stock on September 26, 2024 in the market index Moonshot Tech because of its high performance in at least one of the Obermatt investment strategies. All consolidated Obermatt Ranks are below-average. Based on the Obermatt Method, an investment in the company is not advisable today. Based on the Obermatt 360° View of 12 (12% performer), Obermatt issues an overall sell recommendation for Roche on September 26, 2024.
Snapshot: Obermatt Ranks
| Country | Switzerland |
| Industry | Pharmaceuticals |
| Index | Dividends Europe, Employee Focus EU, Diversity Europe, Human Rights, Moonshot Tech, Recycling, SPI, SMI |
| 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 Roche Sell
| 360 METRICS | September 26, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 48 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 30 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 21 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 34 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 12 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 12 (better than 12% compared with alternatives), overall professional sentiment and financial characteristics for the stock Roche are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with all four indicators below average for Roche. The consolidated Value Rank has a low rank of 48 which means that the share price of Roche is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 52% of alternative stocks in the same industry. The consolidated Growth Rank also has a low rank of 30, 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. This means that growth is lower than for 30% of competitors in the same industry. The consolidated Safety Rank has a riskier rank of 21, which means that the company has a riskier financing structure than 79% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a low rank of 34, which means that professional investors are more pessimistic about the stock than for 66% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 12, Roche is worse than 88% of all alternative stock investment opportunities based on the Obermatt Method. This means that Roche shares are on the riskier side for investors. As all consolidated Obermatt Ranks are below-average, this is a risky stock investment proposition, especially since professional investor sentiment, the consolidated Obermatt Sentiment Rank, is also low at 34. The negative market view on Roche may stem from the high stock price (low value), the low level of growth, or the risky financing structures. That's several problems with no good news anywhere. Based on the current information, we don’t see any compelling arguments to make a case for this stock investment. The company may have a strong future which would justify the high stock price, but this is not confirmed by investor behavior today. While Roche may have a bright future, it is reflected in neither the financial indicators nor the market sentiment. ...read more
Sentiment Strategy: Professional Market Sentiment for Roche only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 34 (better than 34% compared with alternatives), overall professional sentiment and engagement for the stock Roche is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Roche. Analyst Opinions are at a rank of 26 (worse than 74% 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 55, which indicates a shift in stock research experts opinions for the better. In other words, they are getting more optimistic about stock investments in Roche. Even better, the Professional Investors rank is 61, meaning that professional investors hold more stock in this company than in 61% of alternative investment opportunities. Pros tend to favor investing in this company. Furthermore, Market Pulse has a rank of 56, which means that the current professional news and professional social networks are upbeat when discussing this company (more positive news than for 56% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 34 (less encouraging than 66% compared with investment alternatives), Roche has a reputation among professional investors that is below that of its competitors. While analysts are still critical of the company, some are changing their minds. In addition, the professional news channels are optimistic, and many institutional investors have already bought stock in the company. These are encouraging signals, despite the still lower level of analyst recommendations. They may be due to a problematic past, and about to change. The positive sentiment signals are stronger than the negative. ...read more
Value Strategy: Roche Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 48 (worse than 52% compared with alternatives), Roche 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 Roche. Price-to-Profit (also referred to as price-earnings, P/E) is 57 which means that the stock price compared with what market professionals expect for future profits is lower than for 57% of comparable companies, indicating a good value concerning Roche's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 12, which means that the stock price is lower as regards to invested capital than for 12% of comparable investments. On the other hand, Price-to-Sales is less favorable than 62% of alternatives (only 38% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 12% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 48, is a hold recommendation based on Roche's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. ...read more
Growth Strategy: Roche Growth Momentum low
| GROWTH METRICS | September 26, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 37 |
|
||||||
| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 25 |
|
||||||
| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 52 |
|
||||||
| STOCK RETURNS | ||||||||
| STOCK RETURNS | 47 |
|
||||||
| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 30 |
|
||||||
ANALYSIS: With an Obermatt Growth Rank of 30 (better than 30% compared with alternatives), Roche 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 three out of four indicators below average for Roche. Only Capital Growth has a good rank of 52, which means that currently professionals expect the company to grow its invested capital more than 25% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 37 which means that currently professionals expect the company to grow less than 63% of its competitors. Profit Growth with a rank of 25 and Stock Returns with a rank of 47 are also low (below 53% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 30, is a hold 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 Roche 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. ...read more
Safety Strategy: Roche Debt Financing Safety risky
| SAFETY METRICS | September 26, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 15 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 22 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 74 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 21 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 21 (better than 21% compared with alternatives), the company Roche 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 Roche 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 Roche. Liquidity is at 74, meaning the company generates more profit to service its debt than 74% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 22, 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 78% of its competitors. Leverage is also high at a rank of 15, which means that the company has an above-average debt-to-equity ratio. It has more debt than 85% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 21 (worse than 79% compared with alternatives), Roche 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. ...read more
Combined financial peformance: Roche Lowest Financial Performance
| COMBINED PERFORMANCE | September 26, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 48 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 30 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 74 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 6 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 6 (worse than 94% compared with investment alternatives), Roche (Pharmaceuticals, Switzerland) shares have lower financial characteristics compared with similar stocks. Shares of Roche are low in value (priced high) with a consolidated Value Rank of 48 (worse than 52% of alternatives), show below-average growth (Growth Rank of 30), and are riskily financed (Safety Rank of 21), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 6, is a sell recommendation based on Roche's financial characteristics. As the company Roche's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 48), low growth (Obermatt Growth Rank of 30), and risky financing practices (Obermatt Safety Rank of 21), 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. ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.