November 14, 2024
Top 10 Stock Select Medical Strong 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: Select Medical – Top 10 Stock in Dow Jones U.S. Health Care Providers Index
Select Medical is listed as a top 10 stock on November 14, 2024 in the market index D.J. US Health Care because of its high performance in at least one of the Obermatt investment strategies. As three out of four consolidated Obermatt Ranks exhibit excellent performance, it is a solid investment where the risk of paying too much for the shares is low. Based on the Obermatt 360° View of 89 (top 89% performer), Obermatt assesses an overall strong buy recommendation for Select Medical on November 14, 2024.
Snapshot: Obermatt Ranks
| Country | USA |
| Industry | Health Care Facilities |
| Index | Dividends USA, D.J. US Health Care |
| 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 Select Medical Strong Buy
| 360 METRICS | November 14, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 97 |
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| GROWTH | ||||||||
| GROWTH | 63 |
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| SAFETY | ||||||||
| SAFETY | 32 |
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| SENTIMENT | ||||||||
| SENTIMENT | 69 |
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| 360° VIEW | ||||||||
| 360° VIEW | 89 |
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ANALYSIS: With an Obermatt 360° View of 89 (better than 89% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock Select Medical are very positive. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for Select Medical. The consolidated Value Rank has an attractive rank of 97, which means that the share price of Select Medical 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 97% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 63, 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. In addition, professional market sentiment is above average compared with other stock investment alternatives with a Sentiment Rank of 69. But the company’s financing is risky with a Safety rank of 32. This means 68% of comparable companies have a safer financing structure than Select Medical. ...read more
RECOMMENDATION: With a consolidated 360° View of 89, Select Medical is better positioned than 89% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as good value (Value Rank of 97), above-average growth (Growth Rank of 63), and positive market sentiment in the professional investor community (Sentiment Rank of 69), it is a solid stock investment where the risk of paying too much for the shares is limited, and disappointments are less likely, unless information not publicly available. Only the company financing structure is on the riskier side (Safety Rank of 32), but that would also mean better returns for shareholders if things work out well. Good value is sometimes an indication that the company's future is challenging. If they have been growing above average and are still a good value, it may indicate that this will not continue. We recommend evaluating whether the future of Select Medical is as difficult as the low price of the stock, despite good growth and positive professional investor sentiment, suggests. Since the professional community is optimistic, you might have less to worry about, and the stock is just not sufficiently visible right now, which may indicate good timing. ...read more
Sentiment Strategy: Professional Market Sentiment for Select Medical positive
ANALYSIS: With an Obermatt Sentiment Rank of 69 (better than 69% compared with alternatives), overall professional sentiment and engagement for the stock Select Medical is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Select Medical. Analyst Opinions are at a rank of 63 (better than 63% 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 50, which means that stock research experts are changing their opinions for the better in recommending investing in the company. In other words, they are getting even more optimistic about investments in Select Medical. Finally, the Professional Investors rank is 93, which means that currently, professional investors hold more stock in this company than in 93% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 69 (more positive than 69% compared with investment alternatives), Select Medical has a reputation among professional investors that is above-average compared with that of its competitors. Pros tend to favor investing in this company. But there is also a signal for caution. Market Pulse has a rank of 30, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 70% of competitors). This could mean future risks and should make investors careful. Attention to negative news for Select Medical is worthwhile because they may be early warning signals. Without those, all other professional signals are encouraging, especially since analysts are getting more optimistic. ...read more
Value Strategy: Select Medical Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 97 (better than 97% compared with alternatives) for 2024, Select Medical 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 Select Medical. Price-to-Sales (P/S) is 70, which means that the stock price compared with what market professionals expect for future sales is lower than for 70% of comparable companies, indicating a good value concerning Select Medical's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 65% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 87 (dividends are expected to be higher than 87% 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 52% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Select Medical to 48. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 97, is a buy recommendation based on Select Medical'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 in 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 three good value ranks for Sales, Profits, and Dividends are reliable indicators for the stock price value. ...read more
Growth Strategy: Select Medical Growth Momentum good
| GROWTH METRICS | November 14, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 30 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 45 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 69 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 87 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 63 |
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ANALYSIS: With an Obermatt Growth Rank of 63 (better than 63% compared with alternatives), Select Medical 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 Select Medical. Capital Growth has a rank of 69, which means that currently professionals expect the company to grow its invested capital more than 45% of its competitors. Investors welcomed this, visible in the Stock Returns rank of 87 (above 87% of alternative investments). But Sales Growth has only a rank of 30, which means that, currently, professionals expect the company to grow less than 70% of its competitors, and Profit Growth is also low at a rank of 45. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 63, is a buy recommendation for growth and momentum investors. This is an ambiguous picture. Revenue growth and capital growth are strong, but the growth in profit, which seems good, can also be an indication that growth momentum may be negative. The fact that stock returns have been above average doesn't help much, as stock returns are less reliable in showing a company’s future growth potential. Prices may perform well for the simple reason that investors were too pessimistic in the past and are now correcting their opinions and moving the stock price to a more reasonable level. As the growth picture is mixed for Select Medical, investors may want to look at value and sentiment indicators for a well-rounded picture of this stock. ...read more
Safety Strategy: Select Medical Debt Financing Safety below-average
| SAFETY METRICS | November 14, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 20 |
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| REFINANCING | ||||||||
| REFINANCING | 41 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 43 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 32 |
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ANALYSIS: With an Obermatt Safety Rank of 32 (better than 32% compared with alternatives), the company Select Medical has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Select Medical 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 all three metrics below average for Select Medical. Liquidity is at 43, meaning that the company generates less profit to service its debt than 57% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 20, meaning the company has an above-average debt-to-equity ratio. It has more debt than 80% of its competitors. Finally, Refinancing is at a rank of 41 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 59% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 32 (worse than 68% compared with alternatives), Select Medical has a financing structure that is riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing.
Combined financial peformance: Select Medical Top Financial Performance
| COMBINED PERFORMANCE | November 14, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 97 |
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| GROWTH | ||||||||
| GROWTH | 63 |
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| SAFETY | ||||||||
| SAFETY | 43 |
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| COMBINED | ||||||||
| COMBINED | 91 |
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ANALYSIS: With an Obermatt Combined Rank of 91 (better than 91% compared with investment alternatives), Select Medical (Health Care Facilities, USA) shares have much better financial characteristics than comparable stocks. Shares of Select Medical are a good value (attractively priced) with a consolidated Value Rank of 97 (better than 97% of alternatives), show above-average growth (Growth Rank of 63) but are riskily financed (Safety Rank of 32), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 91, is a strong buy recommendation based on Select Medical's financial characteristics. As the company Select Medical's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 97) and above-average growth (Obermatt Growth Rank of 63), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 32) indicates that the company is optimistic about the future and sees debt as an opportunity to boost returns. More debt means more shareholder returns if everything goes well. However, higher debt burdens are risky when interest rates rise or the business deteriorates in a crisis. If you believe the company's future is market-typical or even better, this could be an argument for a share purchase. ...read more
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