June 1, 2023
Top 10 Stock Sumitomo Hold 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: Sumitomo – Top 10 Stock in Tokyo Stock Exchange TOPIX 100
Sumitomo is listed as a top 10 stock on June 01, 2023 in the market index TOPIX 100 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 negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 46 (46% performer), Obermatt assesses an overall hold recommendation for Sumitomo on June 01, 2023.
Snapshot: Obermatt Ranks
| Country | Japan |
| Industry | Trading & Distribution |
| Index | TOPIX 100, SDG 4, Nikkei 225 |
| 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° Assessment Sumitomo Hold
| 360 METRICS | June 1, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 88 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 19 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 63 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 16 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 46 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 46 (better than 46% compared with alternatives), overall professional sentiment and engagement for the stock Sumitomo are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Sumitomo. The consolidated Value Rank has an attractive rank of 88, which means that the share price of Sumitomo is on the lower side compared with typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 88% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 63. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 16. Professional investors are more confident in 84% other stocks. The consolidated Growth Rank also has a low rank of 19, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 81 of its competitors have better growth. ...read more
RECOMMENDATION: With a 360° View of 46, Sumitomo is worse than 54% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 88), and the financing structure is on the safer side (Safety Rank of 63). However, sentiment in the professional investor community is below-average (Sentiment Rank of 16), as is the growth momentum for the company (Growth Rank of 19). While everybody wants to buy at low stock prices (good value), professionals’ skepticism may mean that the low price is justified. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still 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 Sumitomo negative
ANALYSIS: With an Obermatt Sentiment Rank of 16 (better than 16% compared with alternatives), overall professional sentiment and engagement for the stock Sumitomo is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Sumitomo. Analyst Opinions are at a rank of 14 (worse than 86% 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 65, 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 Sumitomo. But the Professional Investors rank is low at 30, which means that professional investors hold less stock in this company than in 70% of alternative investment opportunities. Pros tend to invest in other companies. Market Pulse is also low at a rank of 11, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 89% of competitors). ...read more
RECOMMENDATION: With an Obermatt Sentiment Rank of 16 (less encouraging than 84% compared with investment alternatives), Sumitomo has a reputation among professional investors that is far below 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: Sumitomo Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 88 (better than 88% compared with alternatives) for 2023, Sumitomo shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Sumitomo. Price-to-Sales has a value of 56 which means that the stock price compared with what market professionals expect for future sales is lower than for 56% of comparable companies, indicating a good value for Sumitomo's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 92% of alternatives, and this is also true for the Price-to-Book capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 72. Compared with other companies in the same industry, dividend yields of Sumitomo are expected to be higher than for 91% of all competitors (a Dividend Yield rank of 91). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 88, is a strong buy recommendation based on Sumitomo's stock price compared with the company's operational size and dividend yields. Since all value metrics are above the industry average, there is no objection to investing in Sumitomo based on its detailed value metrics.
Growth Strategy: Sumitomo Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 19 (better than 19% compared with alternatives), Sumitomo shows one of the most restricted growth dynamics in its industry. There is little momentum in this company. The Growth Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Sumitomo. Sales Growth has a rank of 51 which means that currently professionals expect the company to grow more than 51% of its competitors. Stock Returns are also above average with a rank of 87. But Capital Growth has only a rank of 4, which means that currently professionals expect the company to grow its invested capital less than 96% of its competitors. Profit Growth is also low, with a rank of only 14, which means that, currently, professionals expect the company to grow its profits below average. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 19, is a SELL recommendation for growth and momentum investors. This is a surprising picture, as the messages from the operating growth indicators of revenues, profits, and invested capital are mixed, while stock returns are above average. It may indicate new intellectual properties, such as brand improvement or a strong market position that shows in revenues but not in the capital. The low profit-growth rate may indicate an early phase where costs are still high, and revenues don't fully cover upfront investments or fixed costs. The positive investor outlook with a 87% peer outperformance is reaffirmed in this case which may be a good sign for an investment into a well-protected high-growth company. This fact needs to be confirmed by researching the company website and press. ...read more
Safety Strategy: Sumitomo Debt Financing Safety above-average
| SAFETY METRICS | June 1, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 29 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 78 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 42 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 63 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 63 (better than 63% compared with alternatives), the company Sumitomo 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 Sumitomo 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 just one indicator above average for Sumitomo and the other two below average. Refinancing is at 78, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 78% of its competitors. But Leverage is high with a rank of 29, meaning the company has an above-average debt-to-equity ratio. It has more debt than 71% of its competitors. Liquidity is also on the riskier side with a rank of 42, meaning the company generates less profit to service its debt than 58% of its competitors. ...read more
RECOMMENDATION: With an Obermatt Safety Rank of 63 (better than 63% compared with alternatives), Sumitomo has a financing structure that is safer 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 Sumitomo 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: Sumitomo Top Financial Performance
| COMBINED PERFORMANCE | June 1, 2023 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 88 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 19 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 42 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 77 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 77 (better than 77% compared with investment alternatives), Sumitomo (Trading & Distribution, Japan) shares have much better financial characteristics than comparable stocks. Shares of Sumitomo are a good value (attractively priced) with a consolidated Obermatt Value Rank of 88 (better than 88% of alternatives), are safely financed (Safety Rank of 63, which means low debt burdens), but show below-average growth (Growth Rank of 19). ...read more
RECOMMENDATION: An Obermatt Combined Rank of 77, is a strong buy recommendation based on Sumitomo's financial characteristics. As the company Sumitomo's key financial metrics exhibit good value (Obermatt Value Rank of 88) but low growth (Obermatt Growth Rank of 19) while being safely financed (Obermatt Safety Rank of 63), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 88% of comparable companies, may also indicate that the company's future is challenging. If you believe that low growth is temporary or just due to a specific current event, you may conclude that the good value of the stock provides an attractive investment opportunity and the downside is limited due to below-average financing risks. ...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.