May 18, 2023
Top 10 Stock Scatec Solar ASA 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: Scatec Solar ASA – Top 10 Stock in OBX Index
Scatec Solar ASA is listed as a top 10 stock on May 18, 2023 in the market index OBX Index because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company is growing above average, but all other facts speak against a stock purchase, especially the low market sentiment by professional investors. Based on the Obermatt 360° View of 6 (6% performer), Obermatt issues an overall sell recommendation for Scatec Solar ASA on May 18, 2023.
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° Assessment Scatec Solar ASA Sell
| 360 METRICS | May 18, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 42 |
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| GROWTH | ||||||||
| GROWTH | 59 |
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| SAFETY | ||||||||
| SAFETY | 10 |
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| SENTIMENT | ||||||||
| SENTIMENT | 4 |
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| 360° VIEW | ||||||||
| 360° VIEW | 6 |
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ANALYSIS: With an Obermatt 360° View of 6 (better than 6% compared with alternatives), overall professional sentiment and engagement for the stock Scatec Solar ASA are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Scatec Solar ASA. The consolidated Growth Rank has a good rank of 59, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth, as well as stock returns. It ranks higher than 59% of competitors in the same industry. The other indicators are below average, namely the Value, Safety, and Sentiment Ranks.The Value Rank at 42 means that the share price of Scatec Solar ASA is on the high side compared with its peer regarding revenues, profits, and invested capital. The stock price is higher than 58% of alternative stocks in the same industry. The consolidated Safety Rank has a riskier rank of 10, which means that the company has a riskier financing structure than 90% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. The consolidated Sentiment Rank also has a low rank of 4, indicating professional investors are more pessimistic about the stock than for 96% of alternative investment opportunities. ...read more
RECOMMENDATION: With a 360° View of 6, Scatec Solar ASA is worse than 94% of all alternative stock investment opportunities based on the Obermatt Method. This means that Scatec Solar ASA shares are on the riskier side for investors. As only one of the consolidated Obermatt Ranks exhibits excellent performance, namely the above-average growth (Growth Rank of 59), it is a riskier stock investment proposition. Aside from the critical professional market sentiment (Sentiment Rank of 4), the company is rather risky when it comes to financing (Safety Rank of 10). The negative market view on Scatec Solar ASA may be due to the high stock price (low value). A growth company like this may get too expensive at one point in time. If too many investors are desperate to join the party, they may drive stock prices above reasonable levels. While it is typical for growth companies to have low value, because investors are willing to pay more for companies that are expected to have high growth, the crucial question is: how much more do you pay for the stock of Scatec Solar ASA compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one minus the growth rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value (even though it is lower than 50). As market sentiment is critical, you should be careful with paying more than market-average for this stock and conduct further research into the company's future growth potential. ...read more
Sentiment Strategy: Professional Market Sentiment for Scatec Solar ASA negative
ANALYSIS: With an Obermatt Sentiment Rank of 4 (better than 4% compared with alternatives), overall professional sentiment and engagement for the stock Scatec Solar ASA is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Scatec Solar ASA. Analyst Opinions are at a rank of 27 (worse than 73% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 33 which means that stock research experts are getting even more pessimistic. It doesn't end with the analysts. Market Pulse is also low with a rank of 27, 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 73% of competitors). No wonder, the Professional Investors rank is only 10, which means that professional investors hold less stock in this company than in 90% of alternative investment opportunities. Pros tend to stay away from Scatec Solar ASA, which may be due to a small company size but just as likely because of its relatively low Sentiment Rank. ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 4 (less encouraging than 96% compared with investment alternatives), Scatec Solar ASA has a reputation among professional investors that is far below that of its competitors. Investors should be careful with this stock right now. Further research is required if an investment is desired, because the facts found in the professional community are all negative. ...read more
Value Strategy: Scatec Solar ASA Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 42 (worse than 58% compared with alternatives), Scatec Solar ASA shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators where three out of four are below average for Scatec Solar ASA. Only the Price-to-Book Capital ratio (also referred to as market-to-book ratio) indicates good stock value with an Price-to-Book Rank of 75, which means that the stock price is lower compared with invested capital than for 75% of comparable investments. All other value indicators are below the market median. Price-to-Sales is 39 which means the stock price compared with what market professionals expect for future profits is higher than 61% of comparable companies, indicating a low value concerning Scatec Solar ASA's revenue levels. The same is valid for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Book Rank of 75 and for dividend yields which is lower than for 63% of comparable companies, making the stock more expensive compared with the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 42, is a HOLD recommendation based on Scatec Solar ASA's stock price compared with the company's operational size and dividend yields. Why are market participants paying such a high price for Scatec Solar ASA, where three out of four value indicators are below par? One reason could be that the company is well financed, indicated by the high book capital level, and has a promising future that is not yet visible in reported revenues and profits. That would also explain the low dividend yield because the company needs the cash to invest in its future. If investors can verify a picture in this sense, the stock may still be a good investment, even though current company-reported financials don't fully explain current stock prices. ...read more
Growth Strategy: Scatec Solar ASA Growth Momentum good
ANALYSIS: With an Obermatt Growth Rank of 59 (better than 59% compared with alternatives), Scatec Solar ASA shows an above-average growth dynamic in its industry. Investors also speak of positive momentum. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Scatec Solar ASA. Sales Growth has a rank of 96, which means that, currently, professionals expect the company to grow more than 96% of its competitors. Profit Growth with a rank of 88 is also above average. But Capital Growth has only a rank of 4, and Stock Returns with 23 are also below-average. Stock returns for Scatec Solar ASA have recently been below 77% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 59, is a BUY recommendation for growth and momentum investors. Are investors forecasting troubles based on the lack of operating investment activity at the company? This could be one explanation as to why stock returns are low. But stock returns can also be the result of correcting an error in the past, in this case, an overly optimistic outlook on the future, which is now more realistic. The Value Ranks may confirm such a picture. The more important growth indicators are revenues and profits, which are both above average for Scatec Solar ASA. This is a positive sign from the company's operational side and may give investors courage, despite the poor recent stock price performance. ...read more
Safety Strategy: Scatec Solar ASA Debt Financing Safety risky
| SAFETY METRICS | May 18, 2023 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 13 |
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| REFINANCING | ||||||||
| REFINANCING | 58 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 12 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 10 |
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ANALYSIS: With an Obermatt Safety Rank of 10 (better than 10% compared with alternatives), the company Scatec Solar ASA 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 Scatec Solar ASA 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 Scatec Solar ASA and the other two below average. Refinancing is at 58, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 58% of its competitors. But Leverage is high with a rank of 13, meaning the company has an above-average debt-to-equity ratio. It has more debt than 87% of its competitors. Liquidity is also on the riskier side with a rank of 12, meaning the company generates less profit to service its debt than 88% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 10 (worse than 90% compared with alternatives), Scatec Solar ASA has a financing structure that is significantly riskier than that of its competitors. A good Refinancing Rank means that the problems of the company may not be around the corner. But high Leverage is only good if things go well, and low Liquidity is a signal for caution. The financing signals for Scatec Solar ASA are on the riskier side, requiring the company's future to be on the safer side. Investors may want to look at Growth and Sentiment ranks before making a financial decision. ...read more
Combined financial peformance: Scatec Solar ASA Lowest Financial Performance
| COMBINED PERFORMANCE | May 18, 2023 | |||||||
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| VALUE | ||||||||
| VALUE | 42 |
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| GROWTH | ||||||||
| GROWTH | 59 |
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| SAFETY | ||||||||
| SAFETY | 12 |
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| COMBINED | ||||||||
| COMBINED | 23 |
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ANALYSIS: With an Obermatt Combined Rank of 23 (worse than 77% compared with investment alternatives), Scatec Solar ASA (Renewable Electricity, Norway) shares have lower financial characteristics compared with similar stocks. Shares of Scatec Solar ASA are low in value (priced high) with a consolidated Obermatt Value Rank of 42 (worse than 58% of alternatives), and are riskily financed (Safety Rank of 10, which means above-average debt burdens) but show above-average growth (Growth Rank of 59). ...read more
RECOMMENDATION: An Obermatt Combined Rank of 23, is a sell recommendation based on Scatec Solar ASA's financial characteristics. As the company Scatec Solar ASA shows low value with an Obermatt Value Rank of 42 (58% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 59% of comparable companies (Obermatt Growth Rank is 59). This is a typical case. Companies with above average growth tend to cost more than the sluggish variety. If this is a high-growth company, the low Obermatt Safety Rank of 10 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Scatec Solar ASA, even a low-value company (in terms of its key financial indicators) can be a good investment. ...read more
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