August 22, 2024
Top 10 Stock Vedanta 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: Vedanta – Top 10 Stock in Uranium Mining and Production
Vedanta is listed as a top 10 stock on August 22, 2024 in the market index Uranium 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 below average and thus a signal for caution. Based on the Obermatt 360° View of 20 (20% performer), Obermatt issues an overall sell recommendation for Vedanta on August 22, 2024.
Snapshot: Obermatt Ranks
| Country | India |
| Industry | Diversified Metals & Mining |
| Index | Low Emissions, Copper, Energy Efficient, Good Governace Growth Markets, Iron, Lithium, Low Waste, Zinc, Rare Earth, Recycling, Silver, Uranium, Water Efficiency |
| 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 Vedanta Sell
| 360 METRICS | August 22, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 56 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 77 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 8 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 18 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 20 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 20 (better than 20% compared with alternatives), overall professional sentiment and financial characteristics for the stock Vedanta are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with half of the metrics below and half above average for Vedanta. The consolidated Value Rank has an attractive rank of 56, which means that the share price of Vedanta 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 56% of alternative stocks in the same industry. The consolidated Growth Rank has a good rank of 77, 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. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 18. Professional investors are more confident in 82% other stocks. Worryingly, the company has risky financing, with a Safety rank of 8. This means 92% of comparable companies have a safer financing structure than Vedanta. ...read more
RECOMMENDATION: With a consolidated 360° View of 20, Vedanta is worse than 80% of all alternative stock investment opportunities based on the Obermatt Method. This means that Vedanta shares are on the riskier side for investors. Even though half of the consolidated Obermatt Ranks are above-average, namely the Value Rank at 56 and the Growth Rank above-average at 77, the picture is still mixed. The professional investor community is skeptical, with the Sentiment Rank below-average at 18. In addition, the company financing structure is on the riskier side (Safety Rank of 8). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. One may be tempted by above-average growth, but that could also change quickly, as past performance is not a good indicator of future performance. Since the financing structure is on the risky side, investors should 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 Vedanta negative
ANALYSIS: With an Obermatt Sentiment Rank of 18 (better than 18% compared with alternatives), overall professional sentiment and engagement for the stock Vedanta is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Vedanta. Analyst Opinions are at a rank of 58 (better than 58% 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 19, 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 Vedanta. The Professional Investors rank is also low at 31, meaning that professional investors hold less stock in this company than in 69% of alternative investment opportunities. Pros tend to invest in other companies. Even worse, Market Pulse has a low rank of 11, which means that the current professional news and professional social networks are critical of this company (more negative news than for 89% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 18 (less encouraging than 82% compared with investment alternatives), Vedanta 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: Vedanta Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 56 (better than 56% compared with alternatives), Vedanta shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Vedanta. Price-to-Sales (P/S) is 62, which means that the stock price compared with what market professionals expect for future sales is lower than for 62% of comparable companies, indicating a good value concerning Vedanta's revenue size. The same is valid for expected Price-to-Profits (or Price / Earnings, P/E), more favorable than for 56% of alternatives. It is also positive for expected dividend yields with a Dividend Yield rank of 90 (dividends are expected to be higher than 90% 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 80% of all competitors have an even higher price compared with book capital which puts the Price-to-Capital Rank for Vedanta to 20. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 56, is a buy recommendation based on Vedanta'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: Vedanta Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 77 (better than 77% compared with alternatives) for 2024, Vedanta shows one of the highest growth dynamics in its industry. Investors also speak of high momentum. The Growth Rank is based on consolidating four value indicators, with all but one indicator above average for Vedanta. Sales Growth has a rank of 61 which means that currently, professionals expect the company to grow more than 61% of its competitors. Both Profit Growth, with a rank of 73, and Stock Returns, with a rank of 94, are also above average. But Capital Growth only has a rank of 35, which means that, currently, professionals expect the company to grow its invested capital less than 65% of its competitors. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 77, is a buy recommendation for growth and momentum investors. That may be a good sign if the company is already well positioned and doesn't require more investments at this time. They may focus on growing the top (revenues) and bottom (profits) lines, recently rewarded with above-average stock returns for shareholders. But it may also be a sign of danger as the company is falling back with capital investment activities concerning competition. This requires further analysis of corporate communications. ...read more
Safety Strategy: Vedanta Debt Financing Safety risky
| SAFETY METRICS | August 22, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 8 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 5 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 28 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 8 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 8 (better than 8% compared with alternatives), the company Vedanta 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 Vedanta 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 Vedanta. Liquidity is at 28, meaning that the company generates less profit to service its debt than 72% 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 8, meaning the company has an above-average debt-to-equity ratio. It has more debt than 92% of its competitors. Finally, Refinancing is at a rank of 5 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 95% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 8 (worse than 92% compared with alternatives), Vedanta has a financing structure that is significantly 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: Vedanta Below-Average Financial Performance
| COMBINED PERFORMANCE | August 22, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 56 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 77 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 28 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 37 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 37 (worse than 63% compared with investment alternatives), Vedanta (Diversified Metals & Mining, India) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Vedanta are a good value (attractively priced) with a consolidated Value Rank of 56 (better than 56% of alternatives), show above-average growth (Growth Rank of 77) but are riskily financed (Safety Rank of 8), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 37, is a hold recommendation based on Vedanta's financial characteristics. As the company Vedanta's key financial metrics exhibit excellent performance in two areas, such as good value (Obermatt Value Rank of 56) and above-average growth (Obermatt Growth Rank of 77), it could be argued that the risk-taking in financing (Obermatt Safety Rank of only 8) 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
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.