June 6, 2024
Top 10 Stock StepStone Group 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: StepStone Group – Top 10 Stock in Nasdaq Composite Index
StepStone Group is listed as a top 10 stock on June 06, 2024 in the market index NASDAQ because of its high performance in at least one of the Obermatt investment strategies. Three consolidated Obermatt Ranks are above-average. Only the Value Rank is below average. The investment rationale may be an investment in future growth, supported by professional market opinion. Based on the Obermatt 360° View of 95 (top 95% performer), Obermatt assesses an overall strong buy recommendation for StepStone Group on June 06, 2024.
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° View StepStone Group Strong Buy
| 360 METRICS | June 6, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 12 |
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| GROWTH | ||||||||
| GROWTH | 100 |
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| SAFETY | ||||||||
| SAFETY | 98 |
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| SENTIMENT | ||||||||
| SENTIMENT | 62 |
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| 360° VIEW | ||||||||
| 360° VIEW | 95 |
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ANALYSIS: With an Obermatt 360° View of 95 (better than 95% compared with alternatives) for 2024, overall professional sentiment and financial characteristics for the stock StepStone Group are very positive. The 360° View is based on consolidating four consolidated indicators, with all but one indicator above average for StepStone Group. The consolidated Growth Rank has a good rank of 100, 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 100% of competitors in the same industry. The consolidated Safety Rank at 98 means that the company has a financing structure that is safer than 98% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, the consolidated Sentiment Rank has a good rank of 62, which means that professional investors are more optimistic about the stock than for 62% of alternative investment opportunities. But the consolidated Value Rank is less desirable at 12, meaning that the share price of StepStone Group is on the higher side compared with indicators such as revenues, profits, and invested capital. This means the stock price is higher than for 88% of alternative stocks in the same industry. ...read more
RECOMMENDATION: With a consolidated 360° View of 95, StepStone Group is better positioned than 95% of all alternative stock investment opportunities based on the Obermatt Method. As three out of four consolidated Obermatt Ranks exhibit excellent performance, such as above-average growth (Growth Rank of 100), a safe financing structure (Safety Rank of 98), and positive professional market sentiment (Sentiment Rank of 62), it is a solid stock investment where growth may be the strongest driver of the investment rationale, also reflected by institutional investors. It is typical for growth companies to have low value, as is the case here. 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 StepStone Group compared with alternatives? You can use the following rule of thumb: The growth rank measures the growth momentum of the company (100% better than peers). The value rank could be the reverse reflection of that (0%). A Value Rank below that level may be assessed as expensive, a rank above that is still good value. Sometimes market sentiment just reflects the past, sometimes the reality. You pay more than the market average for this stock, but it may be worth it. ...read more
Sentiment Strategy: Professional Market Sentiment for StepStone Group positive
ANALYSIS: With an Obermatt Sentiment Rank of 62 (better than 62% compared with alternatives), overall professional sentiment and engagement for the stock StepStone Group is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for StepStone Group. Analyst Opinions are at a rank of 48 (worse than 52% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. But they are changing their opinions! Analyst Opinions Change has a rank of 97, which means that stock research experts have found something to make them more positive about investing in the company. In other words, they are getting more optimistic of stock investments in StepStone Group. But the Professional Investors rank is low at 34, which means that professional investors hold less stock in this company than in 66% of alternative investment opportunities. Pros tend to invest in other companies. Market Pulse is also low at a rank of 41, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 59% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 62 (more positive than 62% compared with investment alternatives), StepStone Group has a reputation among professional investors that is above-average compared with that of its competitors. These are quite a few negative sentiment signals. One may want to trust the analysts that are changing their opinions. They may be early indications of better times, especially if the company is a smaller one. But If they are an extra large company, they should have more professional stockholders than are currently present. ...read more
Value Strategy: StepStone Group Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 12 (worse than 88% compared with alternatives), StepStone Group 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 StepStone Group. Price-to-Sales is 19 which means that the stock price compared with what market professionals expect for future profits is higher than 81% of comparable companies, indicating a low value concerning StepStone Group's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 33, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of StepStone Group. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 14 and Dividend Yield, which is lower than 51% 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 12, is a sell recommendation based on StepStone Group's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for StepStone Group? 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 StepStone Group? 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. StepStone Group 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: StepStone Group Growth Momentum high
ANALYSIS: With an Obermatt Growth Rank of 100 (better than 100% compared with alternatives) for 2024, StepStone Group 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 four indicators above average for StepStone Group. Sales Growth has a value of 80, which means that, currently, professionals expect the company to grow more than 80% of its competitors. The same is valid for Profit Growth with a value of 91 and for Capital Growth with 98. In addition, Stock Returns had an above-average rank value of 100, which means they have been higher than 100% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 100, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, StepStone Group exhibits above-average growth momentum. This could be due to a uniquely strong market position, proprietary technology, or an extensive corporate acquisition strategy. Growth investors will find this an attractive investment opportunity, unless they expect that the current phase is transitory and will deteriorate in the future. The current performance could also be a temporary recovery from a very low point, such as a turn-around situation. In the case of a turn-around, the current performance may or may not be followed by a continuing positive development. ...read more
Safety Strategy: StepStone Group Debt Financing Safety very solid
| SAFETY METRICS | June 6, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 81 |
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| REFINANCING | ||||||||
| REFINANCING | 77 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 75 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 98 |
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ANALYSIS: With an Obermatt Safety Rank of 98 (better than 98% compared with alternatives) for 2024, the company StepStone Group has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of StepStone Group 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 StepStone Group. Leverage is at 81, meaning the company has a below-average debt-to-equity ratio. It has less debt than 81% of its competitors. Refinancing is at a rank of 77, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 77% of its competitors. Finally, Liquidity is also good at a rank of 75, which means that the company generates more profit to service its debt than 75% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 98 (better than 98% compared with alternatives), StepStone Group 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: StepStone Group Top Financial Performance
| COMBINED PERFORMANCE | June 6, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 12 |
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| GROWTH | ||||||||
| GROWTH | 100 |
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| SAFETY | ||||||||
| SAFETY | 75 |
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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), StepStone Group (Asset Management & Custody, USA) shares have much better financial characteristics than comparable stocks. Shares of StepStone Group are low in value (priced high) with a consolidated Value Rank of 12 (worse than 88% of alternatives). But they show above-average growth (Growth Rank of 100) and are safely financed (Safety Rank of 98, which means below-average debt burdens). ...read more
RECOMMENDATION: A Combined Rank of 91, is a strong buy recommendation based on StepStone Group's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company StepStone Group exhibits low value (Obermatt Value Rank of 12), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 100). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 98) 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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