September 26, 2024
Top 10 Stock Shree Cement 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: Shree Cement – Top 10 Stock in Nifty 50 India Index CNX Nifty 50
Shree Cement is listed as a top 10 stock on September 26, 2024 in the market index CNX Nifty 50 because of its high performance in at least one of the Obermatt investment strategies. Two consolidated Obermatt Ranks are above-average. While the company shows high growth, the stock price is high yet professional investor sentiment is low, which may be due to overly optimistic investor behavior, reflected in a low stock price value. Based on the Obermatt 360° View of 22 (22% performer), Obermatt issues an overall sell recommendation for Shree Cement on September 26, 2024.
Snapshot: Obermatt Ranks
| Country | India |
| Industry | Construction Materials |
| Index | Low Emissions, Low Waste, CNX Nifty 50 |
| 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 Shree Cement Sell
| 360 METRICS | September 26, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 19 |
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| GROWTH | ||||||||
| GROWTH | 57 |
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| SAFETY | ||||||||
| SAFETY | 62 |
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| SENTIMENT | ||||||||
| SENTIMENT | 13 |
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| 360° VIEW | ||||||||
| 360° VIEW | 22 |
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ANALYSIS: With an Obermatt 360° View of 22 (better than 22% compared with alternatives), overall professional sentiment and financial characteristics for the stock Shree Cement 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 Shree Cement. The consolidated Growth Rank has a good rank of 57, 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. This means that growth is higher than for 57% of competitors in the same industry. In addition, the consolidated Safety Rank has a safer rank of 62 which means that the company has a financing structure that is safer than 62% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. But the consolidated Value Rank has a less desirable rank of 19 which means that the share price of Shree Cement is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is higher than for 81% of alternative stocks in the same industry. The consolidated Sentiment Rank also has a low rank of 13, which means that professional investors are more pessimistic about the stock than for 87% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 22, Shree Cement is worse than 78% of all alternative stock investment opportunities based on the Obermatt Method. This means that Shree Cement shares are on the riskier side for investors. As only half of the consolidated Obermatt Ranks exhibit excellent performance, the picture is ambiguous. Growth is above-average (Growth Rank of 57), and the company is safely financed (Safety Rank of 62). However, professional market sentiment is low(Sentiment Rank of 13). The negative market view on Shree Cement 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 board the train, they may drive stock prices above reasonable levels. It is typical for growth companies to have low value ratings, because investors are willing to pay more for companies that outperform their competitors. So the question is, how much more do you pay for the stock of Shree Cement compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one hundred 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 if the value rank is above 60. As market sentiment is low, 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 Shree Cement negative
ANALYSIS: With an Obermatt Sentiment Rank of 13 (better than 13% compared with alternatives), overall professional sentiment and engagement for the stock Shree Cement 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 Shree Cement. Analyst Opinions are at a rank of 30 (worse than 70% 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 43 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 26, 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 74% of competitors). No wonder, the Professional Investors rank is only 26, which means that professional investors hold less stock in this company than in 74% of alternative investment opportunities. Pros tend to stay away from Shree Cement, which may be due to a small company size but just as likely because of its relatively low Sentiment Rank. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 13 (less encouraging than 87% compared with investment alternatives), Shree Cement 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: Shree Cement Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 19 (worse than 81% compared with alternatives), Shree Cement shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Shree Cement. Price-to-Sales is 27 which means that the stock price compared with what market professionals expect for future profits is higher than 73% of comparable companies, indicating a low value concerning Shree Cement's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 39, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Shree Cement. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 23 and Dividend Yield, which is lower than 80% of comparable companies, also make the stock more expensive compared with investment alternatives. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 19, is a sell recommendation based on Shree Cement's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Shree Cement? One reason may be that the company is simply too popular. If enough people want a particular stock, its price can exceed reasonable levels. This is often the case for companies offering new and exciting products and everybody wants a piece of the action. Should you pay a lot for a hot stock such as Shree Cement? It's risky, and even if the stock price continues to grow because of popular demand, it may return to more typical lower levels later. And that return can be sudden and quick, making it impossible for retail investors to exit on time. Sometimes, high prices are deserved. This is the case when it is justified to believe that the company will dominate a market with high profit margins. It has happened in the past for many technology companies and indeed for commercially successful pharmaceutical discoveries. Sometimes they last, sometimes, they get eaten alive. Shree Cement may be such a type of stock. That would mean, retail investors should be careful, only considering investing a small part of their wealth in this exciting category and always being ready to lose more than half, if not all of the investment. ...read more
Growth Strategy: Shree Cement Growth Momentum good
| GROWTH METRICS | September 26, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 70 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 25 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 67 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 35 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 57 |
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ANALYSIS: With an Obermatt Growth Rank of 57 (better than 57% compared with alternatives), Shree Cement 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 Shree Cement. Sales Growth has a rank of 70 which means that currently, professionals expect the company to grow more than 70% of its competitors. Capital Growth is also above 25% of competitors with a rank of 67. But Profit Growth only has a rank of 25, which means that currently professionals expect the company to grow its profits less than 75% of its competitors. And Stock Returns have also been below average with a rank of only 35. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 57, is a buy recommendation for growth and momentum investors. Profits are sometimes low if the company invests in the future. The positive revenue and capital investment outlook confirms such an interpretation. Both revenues and capital are solid growth indicators, and lower profits in such a case would be encouraging. But the investors see it differently by punishing the share price. Sometimes, Mister Market is not very reliable, because it is not uncommon for it to be volatile. Investors should look out for signs of growth expenditure that could justify low profit growth, and they may also find reasons why recent stock price developments don't confirm the growth outlook of operations. While operating growth indicators are not perfect, they are more reliable indicators for future performance than stock prices that can repeatedly surprise investors. ...read more
Safety Strategy: Shree Cement Debt Financing Safety above-average
| SAFETY METRICS | September 26, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 78 |
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| REFINANCING | ||||||||
| REFINANCING | 43 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 53 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 62 |
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ANALYSIS: With an Obermatt Safety Rank of 62 (better than 62% compared with alternatives), the company Shree Cement has financing practices on the safer side, which mean that their overall debt burden is lower than average. This doesn't mean that the business of Shree Cement 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, with two out of three indicators above average for Shree Cement. Leverage is at a rank of 78, meaning the company has a below-average debt-to-equity ratio. It has less debt than 78% of its competitors. Liquidity is also good at a rank of 53, meaning the company generates more profit to service its debt than 53% of its competitors. This indicates that the company is on the safer side when it comes to debt service. But Refinancing is lower at a rank of 43, which means that the portion of the debt that is about to be refinanced is above-average. It has more debt in the refinancing stage than 57% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 62 (better than 62% compared with alternatives), Shree Cement has a financing structure that is safer than that of its competitors. The refinancing issues could be a short-term problem, especially if the company has reputation issues. Banks and investors don't like to refinance debt if there are clouds on the horizon. For this reason, investors should look at the refinancing environment for Shree Cement. Does it look safe that debt that is coming due can be covered with new debt? If that is the case, then the financing situation of the company is on the safer side. If not, it may be better to wait until refinancing has been completed and the Refinancing rank is good again. ...read more
Combined financial peformance: Shree Cement Below-Average Financial Performance
| COMBINED PERFORMANCE | September 26, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 19 |
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| GROWTH | ||||||||
| GROWTH | 57 |
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| SAFETY | ||||||||
| SAFETY | 53 |
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| COMBINED | ||||||||
| COMBINED | 40 |
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ANALYSIS: With an Obermatt Combined Rank of 40 (worse than 60% compared with investment alternatives), Shree Cement (Construction Materials, India) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Shree Cement are low in value (priced high) with a consolidated Value Rank of 19 (worse than 81% of alternatives). But they show above-average growth (Growth Rank of 57) and are safely financed (Safety Rank of 62, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 40, is a hold recommendation based on Shree Cement's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Shree Cement exhibits low value (Obermatt Value Rank of 19), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 57). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 62) are a double-edged sword: if the company continues growing, low debt limits shareholder returns. But if the company increases its debt, it will also increase risk. In other words, this is an investment on the safer side, despite the above-average price (low value). ...read more
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