May 16, 2024
Top 10 Stock Lotte Fine Chemical 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: Lotte Fine Chemical – Top 10 Stock in Low Emission Leaders
Lotte Fine Chemical is listed as a top 10 stock on May 16, 2024 in the market index Low Emissions 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 60 (high 60% performer), Obermatt assesses an overall buy recommendation for Lotte Fine Chemical on May 16, 2024.
Snapshot: Obermatt Ranks
| Country | South Korea |
| Industry | Diversified Chemicals |
| Index | Low Emissions, KOSPI |
| Size class | 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 Lotte Fine Chemical Buy
| 360 METRICS | May 16, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 79 |
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| GROWTH | ||||||||
| GROWTH | 11 |
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| SAFETY | ||||||||
| SAFETY | 100 |
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| SENTIMENT | ||||||||
| SENTIMENT | 43 |
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| 360° VIEW | ||||||||
| 360° VIEW | 60 |
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ANALYSIS: With an Obermatt 360° View of 60 (better than 60% compared with alternatives), overall professional sentiment and financial characteristics for the stock Lotte Fine Chemical are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Lotte Fine Chemical. The consolidated Value Rank has an attractive rank of 79, which means that the share price of Lotte Fine Chemical 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 79% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 100. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 43. Professional investors are more confident in 57% 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 60, Lotte Fine Chemical is better positioned than 60% 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 79), and the financing structure is on the safer side (Safety Rank of 100). However, sentiment in the professional investor community is below-average (Sentiment Rank of 43), 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 Lotte Fine Chemical only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 43 (better than 43% compared with alternatives), overall professional sentiment and engagement for the stock Lotte Fine Chemical 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 Lotte Fine Chemical. Analyst Opinions are at a rank of 87 (better than 87% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. Analyst Opinions Change is also positive and has a rank of 60 which means that currently, stock research experts are getting even more optimistic about investments in Lotte Fine Chemical. But Market Pulse has a low rank of 1, 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 99% of competitors). This is an essential sign of caution, as it could be the forebearer of bad news. Professional Investors are also somewhat absent with a rank of 41, which means that, currently, professional investors hold less stock in this company than in 59% of alternative investment opportunities. Pros tend to invest in other companies. This is expected if the company is of a smaller size (medium or smaller). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 43 (less encouraging than 57% compared with investment alternatives), Lotte Fine Chemical has a reputation among professional investors that is below that of its competitors. While the general news feeds in the professional market are negative, the analyst recommendations are optimistic about the company, and even increase their ratings despite the negative news. This is an ambiguous situation with positive and negative signals from the professional side. Investors should be on the lookout for negative news but not worry too much about it as long as the overall news is still positive. ...read more
Value Strategy: Lotte Fine Chemical Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 79 (better than 79% compared with alternatives) for 2024, Lotte Fine Chemical 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 Lotte Fine Chemical. Price-to-Profit (also referred to as price to earnings, P/E ratio) is 91 which means that the stock price compared with what market professionals expect for future profits is lower than for 91% of comparable companies, indicating a good value concerning Lotte Fine Chemical's profit levels. The same is valid for the expected Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 78, and for Dividend Yield with a Dividend Yield Rank of 98. But, compared with other companies in the same industry, the stock price is higher than average as regards expected revenues; only 64% of all competitors have an even higher stock price as regards to sales revenues (a Price-to-Sales Rank of 36). Profits, the level of invested capital, and dividend policy suggest that this stock is attractively priced. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 79, is a buy recommendation based on Lotte Fine Chemical's stock price compared with the company's operational size and dividend yields. Since it is on the expensive side for Price-to-Sales, it may mean that Lotte Fine Chemical has pricing power in its distribution market because it can charge higher prices than its competitors. If this is the case, all four value indicators are positive signals for purchasing Lotte Fine Chemical shares. ...read more
Growth Strategy: Lotte Fine Chemical Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 11 (better than 11% compared with alternatives), Lotte Fine Chemical 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 Lotte Fine Chemical. While Sales Growth ranks at 72, professionals currently expect the company to grow more than 72% of its competitors, while all other growth ranks are below the market median. Profit Growth has a rank of 25, which means that, currently, professionals expect the company to grow its profits less than 75% of its competitors, and Capital Growth has a low rank of 18. Historic stock returns were also below average with a current Stock Returns rank of 9 which means that the stock returns have recently been below 91% 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. 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: Lotte Fine Chemical Debt Financing Safety very solid
| SAFETY METRICS | May 16, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 95 |
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| REFINANCING | ||||||||
| REFINANCING | 94 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 88 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 100 |
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ANALYSIS: With an Obermatt Safety Rank of 100 (better than 100% compared with alternatives) for 2024, the company Lotte Fine Chemical has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Lotte Fine Chemical 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 Lotte Fine Chemical. Leverage is at 95, meaning the company has a below-average debt-to-equity ratio. It has less debt than 95% of its competitors. Refinancing is at a rank of 94, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 94% of its competitors. Finally, Liquidity is also good at a rank of 88, which means that the company generates more profit to service its debt than 88% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 100 (better than 100% compared with alternatives), Lotte Fine Chemical 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: Lotte Fine Chemical Above-Average Financial Performance
| COMBINED PERFORMANCE | May 16, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 79 |
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| GROWTH | ||||||||
| GROWTH | 11 |
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| SAFETY | ||||||||
| SAFETY | 88 |
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| COMBINED | ||||||||
| COMBINED | 71 |
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ANALYSIS: With an Obermatt Combined Rank of 71 (better than 71% compared with investment alternatives), Lotte Fine Chemical (Diversified Chemicals, South Korea) shares have above-average financial characteristics compared with similar stocks. Shares of Lotte Fine Chemical are a good value (attractively priced) with a consolidated Value Rank of 79 (better than 79% of alternatives), are safely financed (Safety Rank of 100, which means low debt burdens), but show below-average growth (Growth Rank of 11). ...read more
RECOMMENDATION: A Combined Rank of 71, is a buy recommendation based on Lotte Fine Chemical's financial characteristics. As the company Lotte Fine Chemical's key financial metrics exhibit good value (Obermatt Value Rank of 79) but low growth (Obermatt Growth Rank of 11) while being safely financed (Obermatt Safety Rank of 100), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 79% 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
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