April 11, 2024
Top 10 Stock RWE 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: RWE – Top 10 Stock in Deutscher Aktienindex DAX 40
RWE is listed as a top 10 stock on April 11, 2024 in the market index DAX 40 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 38 (38% performer), Obermatt assesses an overall hold recommendation for RWE on April 11, 2024.
Snapshot: Obermatt Ranks
| Country | Germany |
| Industry | Power Producers & Traders |
| Index | CDAX, DAX 40, Low Emissions, Diversity Europe, Nuclear, Water Tech |
| 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 RWE Hold
| 360 METRICS | April 11, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 83 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 11 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 73 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 19 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 38 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 38 (better than 38% compared with alternatives), overall professional sentiment and financial characteristics for the stock RWE 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 RWE. The consolidated Value Rank has an attractive rank of 83, which means that the share price of RWE 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 83% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 73. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 19. Professional investors are more confident in 81% other stocks. The consolidated Growth Rank also has a low rank of 11, 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. 89 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 38, RWE is worse than 62% 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 83), and the financing structure is on the safer side (Safety Rank of 73). However, sentiment in the professional investor community is below-average (Sentiment Rank of 19), as is the growth momentum for the company (Growth Rank of 11). 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 RWE negative
ANALYSIS: With an Obermatt Sentiment Rank of 19 (better than 19% compared with alternatives), overall professional sentiment and engagement for the stock RWE is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for RWE. Analyst Opinions are at a rank of 84 (better than 84% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. This is a good sign, were it not for Analyst Opinions Change with a low rank of 26, which means that currently, stock research experts are changing their opinions for the worse. In other words, they are getting more critical of a stock investment in RWE. The Professional Investors rank is also low at 6, meaning that professional investors hold less stock in this company than in 94% of alternative investment opportunities. Pros tend to invest in other companies. Even worse, Market Pulse has a low rank of 30, which means that the current professional news and professional social networks are critical of this company (more negative news than for 70% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 19 (less encouraging than 81% compared with investment alternatives), RWE has a reputation among professional investors that is far below that of its competitors. There are several negative sentiment signals, with only the Analyst Opinions Rank above average. This could be a stock with a long reputation for being positive but where things are worsening. Most analysts may not see it yet, but some have, and the professionals are already quite pessimistic. Proceed with caution when investing in this stock. ...read more
Value Strategy: RWE Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 83 (better than 83% compared with alternatives) for 2024, RWE 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 RWE. Price-to-Sales (P/S) 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 regarding RWE's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 72% 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 95. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 43% of all competitors have even lower dividend yields than RWE (a Dividend Yield Rank of 43). 57% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 83, is a buy recommendation based on RWE'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: RWE Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 11 (better than 11% compared with alternatives), RWE 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 RWE. Only Capital Growth has a good rank of 77, which means that currently professionals expect the company to grow its invested capital more than 13% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 29 which means that currently professionals expect the company to grow less than 71% of its competitors. Profit Growth with a rank of 13 and Stock Returns with a rank of 19 are also low (below 81% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 11, 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 RWE 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: RWE Debt Financing Safety above-average
| SAFETY METRICS | April 11, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 85 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 100 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 6 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 73 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 73 (better than 73% compared with alternatives), the company RWE 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 RWE 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 where two out of three are above average for RWE.Leverage is at 85, meaning the company has a below-average debt-to-equity ratio. It has less debt than 85% of its competitors.Refinancing is at a rank of 100, meaning that the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 100% of its competitors. Liquidity is at 6, meaning that the company generates less profit to service its debt than 94% of its competitors. This indicates that the company is on the riskier side regarding debt service. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 73 (better than 73% compared with alternatives), RWE has a financing structure that is safer than that of its competitors. Low leverage and low refinancing risk mean a safer financing situation. However, low liquidity means that current company cash flows are low in relation to the level of debt. This is a sign of caution in case it is expected for profits to remain low. ...read more
Combined financial peformance: RWE Above-Average Financial Performance
| COMBINED PERFORMANCE | April 11, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 83 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 11 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 6 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 57 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 57 (better than 57% compared with investment alternatives), RWE (Power Producers & Traders, Germany) shares have above-average financial characteristics compared with similar stocks. Shares of RWE are a good value (attractively priced) with a consolidated Value Rank of 83 (better than 83% of alternatives), are safely financed (Safety Rank of 73, which means low debt burdens), but show below-average growth (Growth Rank of 11). ...read more
RECOMMENDATION: A Combined Rank of 57, is a buy recommendation based on RWE's financial characteristics. As the company RWE's key financial metrics exhibit good value (Obermatt Value Rank of 83) but low growth (Obermatt Growth Rank of 11) while being safely financed (Obermatt Safety Rank of 73), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 83% 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
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.