May 16, 2024
Top 10 Stock Samsung Engineering Buy 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: Samsung Engineering – Top 10 Stock in Korea Composite Stock Price Index KOSPI
Samsung Engineering is listed as a top 10 stock on May 16, 2024 in the market index KOSPI because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. The company is safely financed and the professional investor sentiment is positive. Both are encouraging signals for a stock purchase decision, albeit at an above-average share price. Based on the Obermatt 360° View of 63 (high 63% performer), Obermatt assesses an overall buy recommendation for Samsung Engineering on May 16, 2024.
Snapshot: Obermatt Ranks
| Country | South Korea |
| Industry | Construction & Engineering |
| Index | Water Tech, KOSPI |
| Size class | X-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 Samsung Engineering Buy
| 360 METRICS | May 16, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 19 |
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| GROWTH | ||||||||
| GROWTH | 3 |
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| SAFETY | ||||||||
| SAFETY | 96 |
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| SENTIMENT | ||||||||
| SENTIMENT | 95 |
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| 360° VIEW | ||||||||
| 360° VIEW | 63 |
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ANALYSIS: With an Obermatt 360° View of 63 (better than 63% compared with alternatives), overall professional sentiment and financial characteristics for the stock Samsung Engineering are above average. The 360° View is based on consolidating four consolidated indicators, with half below and half above average for Samsung Engineering. The consolidated Sentiment Rank has a good rank of 95, which means that professional investors are more optimistic about the stock than for 95% of alternative investment opportunities. It also rates well regarding its financing structure, with the consolidated Safety Rank at 96 or better than 96% of its peers when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the stock is expensive and expects low growth. The consolidated Value Rank is only 19, meaning that the share price of Samsung Engineering is on the high side, compared with indicators such as revenues, profits, and invested capital. The company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth,and stock returns, with its Growth Rank at 3. ...read more
RECOMMENDATION: With a consolidated 360° View of 63, Samsung Engineering is better positioned than 63% of all alternative stock investment opportunities based on the Obermatt Method. As only half of the consolidated Obermatt Ranks exhibit excellent performance, namely the positive professional market sentiment (Sentiment Rank of 95) and safe financing practices (Safety Rank of 96), the case for investing in this stock needs further thought. The Value and the Safety Ranks are below average. The Safety Rank is the least critical of the four consolidated ranks, because it only reflects financing practices. So the question is: How to assess below-average value against above-average sentiment? This may be a case where growth is in the future, not yet reflected in current performance. Companies that might fall into this category are those with intellectual property, such as technology and pharmaceutical companies. In early phases, they are expensive relative to their size and have a lot of capital on their books, as is the case here. Investors expect a better future and are willing to pay a higher price than is warranted by the current company size. These higher prices drive stock price value down in the short term. In this case, future growth may be the strongest driver of the investment case, reflected by institutional investors' opinions. With a weak Value Rank, the question is how much to sacrifice value at the cost of positive sentiment. Sometimes market sentiment is just hype, but sometimes it is right. You pay more than market-average for this stock, but it may be worth it, if the future of Samsung Engineering̣ is bright. Prudent investors may only want to invest a smaller portion of their wealth in such situations. Young investors can carry more risk but should still thrive for sufficient diversification. ...read more
Sentiment Strategy: Professional Market Sentiment for Samsung Engineering very positive
ANALYSIS: With an Obermatt Sentiment Rank of 95 (better than 95% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Samsung Engineering is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Samsung Engineering. Analyst Opinions are at a rank of 93 (better than 93% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. In addition, Analyst Opinions Change has a rank of 73, which means that currently, stock research experts are getting even more optimistic. Obermatt Market Pulse further supports this with a rank of 85, which means that the current professional news and professional social networks are generally positive when discussing this company (more positive news than for 85% of competitors). But there are few stock holdings by institutional investors. The Professional Investors rank is low at 27, which means that currently, professional investors hold less stock in this company than in 73% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 95 (more positive than 95% compared with investment alternatives), Samsung Engineering has a reputation among professional investors that is significantly higher than that of its competitors. Not having too many professionals invested in Samsung Engineering may be less of an issue, especially if the stock is from a smaller company where professionals typically invest less. It is natural for professional investors to focus on large and extra-large companies, as they provide more safety. Smaller companies attract fewer professionals in the shareholder community. Overall, the signals from the professionals are still quite favorable for investments in Samsung Engineering. ...read more
Value Strategy: Samsung Engineering Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 19 (worse than 81% compared with alternatives), Samsung Engineering shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, where half the indicators are below and half are above average for Samsung Engineering. Price-to-Sales (P/S) is 56, which means that the stock price compared with what market professionals expect for future sales is lower than for 56% of comparable companies, indicating a good value concerning Samsung Engineering's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 75% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 8 (dividends are expected to be higher than for 8% of other stocks). But, compared with other companies in the same industry, the Price-to-Book Capital ratio (also referred to as market-to-book ratio) is higher than average, making the stock more expensive. Only 71% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Samsung Engineering to 29. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 19, is a sell recommendation based on Samsung Engineering's stock price compared with the company's operational size and dividend yields. A low level of book capital means that the company has a business that is leaner on assets than its competitors. For instance, the company could be leasing its production facilities, or be more focussed on intellectual property, such as its brand and software, which is less visible in its book capital. If that is the case, the low Dividend Yield is also explained as such companies tend to invest their income into market development. The other good value ranks for Sales and Profits are encouraging indicators for the stock price value. ...read more
Growth Strategy: Samsung Engineering Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 3 (better than 3% compared with alternatives), Samsung Engineering 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 Samsung Engineering. While Sales Growth ranks at 63, professionals currently expect the company to grow more than 63% of its competitors, while all other growth ranks are below the market median. Profit Growth has a rank of 8, which means that, currently, professionals expect the company to grow its profits less than 92% of its competitors, and Capital Growth has a low rank of 1. Historic stock returns were also below average with a current Stock Returns rank of 5 which means that the stock returns have recently been below 95% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 3, is a sell recommendation for growth and momentum investors. If revenues are expected to increase, but all other growth indicators are negative, the company may be investing in future growth through means not visible in the balance sheet and thus not reflected in capital growth. The fact that Stock Returns have been below market doesn't mean that much, as it may be due to overly optimistic investor behavior in the past, which has been corrected to a more reasonable level recently. If that were the case, a positive Value Rank would be a reason to invest because the company is still expected to grow, while stock prices are now at a more reasonable level. ...read more
Safety Strategy: Samsung Engineering Debt Financing Safety very solid
| SAFETY METRICS | May 16, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 90 |
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| REFINANCING | ||||||||
| REFINANCING | 63 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 78 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 96 |
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ANALYSIS: With an Obermatt Safety Rank of 96 (better than 96% compared with alternatives) for 2024, the company Samsung Engineering has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Samsung Engineering 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 all three are above average for Samsung Engineering. Leverage is at 90, meaning the company has a below-average debt-to-equity ratio. It has less debt than 90% of its competitors. Refinancing is at a rank of 63, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 63% of its competitors. Finally, Liquidity is also good at a rank of 78, which means that the company generates more profit to service its debt than 78% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 96 (better than 96% compared with alternatives), Samsung Engineering has a financing structure that is significantly safer than that of its competitors. These three positive financing indicators signal that the company is less likely to default on its debt obligations. However, it also means that its shareholder returns will be more modest if things go well. A low safety means fewer troubles in downtimes and less upside in good times. ...read more
Combined financial peformance: Samsung Engineering Below-Average Financial Performance
| COMBINED PERFORMANCE | May 16, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 19 |
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| GROWTH | ||||||||
| GROWTH | 3 |
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| SAFETY | ||||||||
| SAFETY | 78 |
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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), Samsung Engineering (Construction & Engineering, South Korea) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Samsung Engineering are low in value (priced high) with a consolidated Value Rank of 19 (worse than 81% of alternatives) and show below-average growth (Growth Rank of 3) but are safely financed (Safety Rank of 96), which means low debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 26, is a hold recommendation based on Samsung Engineering's financial characteristics. As the company Samsung Engineering's critical financial metrics exhibit below-average performance, such as low value (Obermatt Value Rank of 19) and low growth (Obermatt Growth Rank of 3), 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 96) 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. ...read more
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