Fact based stock research
Sumitomo Bakelite (TSE:4203)

JP3409400003

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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.

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Sumitomo Bakelite stock research in summary

sumibe.co.jp

ANALYSIS: With an Obermatt Combined Rank of 91 (better than 91% compared with investment alternatives), Sumitomo Bakelite (Specialty Chemicals, Japan) shares have much better financial characteristics than comparable stocks. Shares of Sumitomo Bakelite are low in value (priced high) with a consolidated Value Rank of 29 (worse than 71% of alternatives). But they show above-average growth (Growth Rank of 99) and are safely financed (Safety Rank of 85, which means below-average debt burdens). ...read more

RECOMMENDATION: A Combined Rank of 91, is a strong buy recommendation based on Sumitomo Bakelite's financial characteristics. Investors looking for growth and low financial risk may find this stock attractive. While the company Sumitomo Bakelite exhibits low value (Obermatt Value Rank of 29), which means that the stock price is rather high, it also demonstrates above-average growth (Obermatt Growth Rank of 99). This is a typical case, as high-growth companies are often expensive. Good financing practices (Obermatt Safety Rank of 85) 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). Obermatt Premium subscribers can further check the stock’s Sentiment Ranks, which also flow into the Obermatt 360° View for investors. ...read more

Latest Obermatt Ranks


360° View^new
Sentiment Rank^new
Value Rank	29
Growth Rank	99
Safety Rank	85
Combined Rank	91

Country	Japan
Industry	Specialty Chemicals
Index	Low Emissions
Size class	Large

This stock has achievements: Top 10 Stock.

14-Nov-2024. Stock data may be delayed. Log in or sign up to get the most recent research.

Further information

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Review the performance ranks of the individual metrics that form each investment strategy.

Research History: Sumitomo Bakelite

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	95	31	43	29
GROWTH
GROWTH	18	69	89	99
SAFETY
SAFETY	100	61	72	85
SENTIMENT
SENTIMENT	n/a	63	82	^new
360° VIEW
360° VIEW	n/a	63	90	^new

Most recent update of the stock research: 14-Nov-2024. Financial reporting date used for calculating ranks: 30-Jun-2024. Stock research history is based on the Obermatt Method. The higher the rank, the better Sumitomo Bakelite is in the corresponding investment strategy.
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Combined financial peformance in Detail

RESEARCH HISTORY	2021	2022	2023	2024
VALUE
VALUE	95	31	43	29
GROWTH
GROWTH	18	69	89	99
SAFETY
SAFETY	100	61	72	85
COMBINED
COMBINED	100	57	82	91

Last update of combined financial performance: 14-Nov-2024. Stock analysis on combined financial performance: The higher the rank of Sumitomo Bakelite the better the performance.

Value Metrics in Detail

ANALYSIS: With an Obermatt Value Rank of 29 (worse than 71% compared with alternatives), Sumitomo Bakelite shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Sumitomo Bakelite. Price-to-Sales is 28 which means that the stock price compared with what market professionals expect for future profits is higher than 72% of comparable companies, indicating a low value concerning Sumitomo Bakelite's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 29, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Sumitomo Bakelite. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 44 and Dividend Yield, which is lower than 58% 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 29, is a hold recommendation based on Sumitomo Bakelite's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Sumitomo Bakelite? 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 Sumitomo Bakelite? 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. Sumitomo Bakelite 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. We recommend further analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks, including the 360° View, before making an investment decision, which is essential in this case, as the financial indicators are inconclusive. ...read more

VALUE METRICS	2021	2022	2023	2024
PRICE VS. REVENUES (P/S)
PRICE VS. REVENUES (P/S)	84	39	36	28
PRICE VS. PROFITS (P/E)
PRICE VS. PROFITS (P/E)	90	35	64	44
PRICE VS. CAPITAL (Market-to-Book)
PRICE VS. CAPITAL (Market-to-Book)	88	51	37	29
DIVIDEND YIELD
DIVIDEND YIELD	82	46	28	42
CONSOLIDATED RANK: VALUE
CONSOLIDATED RANK: VALUE	95	31	43	29

Last update of Value Rank: 14-Nov-2024. Stock analysis on value ratios: The higher the rank, the lower the value ratio of Sumitomo Bakelite; except for dividend yield where the rank is higher, the higher the yield.

Growth Metrics in Detail

ANALYSIS: With an Obermatt Growth Rank of 99 (better than 99% compared with alternatives) for 2024, Sumitomo Bakelite 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 Sumitomo Bakelite. Sales Growth has a value of 79, which means that, currently, professionals expect the company to grow more than 79% of its competitors. The same is valid for Profit Growth with a value of 56 and for Capital Growth with 89. In addition, Stock Returns had an above-average rank value of 83, which means they have been higher than 83% of comparable investments. ...read more

RECOMMENDATION: The overall picture with a consolidated Growth Rank of 99, is a buy recommendation for growth and momentum investors. Since all Growth Ranks are positive, Sumitomo Bakelite 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. While momentum is a popular investment factor, the value aspect might be the more important one, in the longer term. We recommend analyzing the stock with Obermatt’s Value, Safety, and Sentiment Ranks to arrive at a 360° View of the stock purchase case. ...read more

GROWTH METRICS	2021	2022	2023	2024
REVENUE GROWTH
REVENUE GROWTH	14	51	65	79
PROFIT GROWTH
PROFIT GROWTH	79	47	67	56
CAPITAL GROWTH
CAPITAL GROWTH	n/a	19	49	89
STOCK RETURNS
STOCK RETURNS	86	95	99	83
CONSOLIDATED RANK: GROWTH
CONSOLIDATED RANK: GROWTH	18	69	89	99

Last update of Growth Rank: 14-Nov-2024. Stock analysis on growth metrics: The higher the rank, the higher the growth and returns of Sumitomo Bakelite.

Safety Metrics in Detail

ANALYSIS: With an Obermatt Safety Rank of 85 (better than 85% compared with alternatives) for 2024, the company Sumitomo Bakelite has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Sumitomo Bakelite 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 Sumitomo Bakelite. Leverage is at 78, meaning the company has a below-average debt-to-equity ratio. It has less debt than 78% of its competitors. Refinancing is at a rank of 51, meaning that the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 51% of its competitors. Finally, Liquidity is also good at a rank of 83, which means that the company generates more profit to service its debt than 83% of its competitors. ...read more

RECOMMENDATION: With a consolidated Safety Rank of 85 (better than 85% compared with alternatives), Sumitomo Bakelite 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. Investors may not have a debt issue with Sumitomo Bakelite but they should also compare Obermatt’s Value, Growth, and Sentiment Ranks before making a decision. ...read more

SAFETY METRICS	2021	2022	2023	2024
LEVERAGE
LEVERAGE	84	50	74	78
REFINANCING
REFINANCING	80	53	49	51
LIQUIDITY
LIQUIDITY	100	67	84	83
CONSOLIDATED RANK: SAFETY
CONSOLIDATED RANK: SAFETY	100	61	72	85

Last update of Safety Rank: 14-Nov-2024. Stock analysis on safety metrics: The higher the rank, the lower the leverage of Sumitomo Bakelite and the more cash is available to service its debt.

Sentiment Metrics in Detail

SENTIMENT	2021	2022	2023	2024
ANALYST OPINIONS
ANALYST OPINIONS	n/a	76	81	^new
OPINIONS CHANGE
OPINIONS CHANGE	n/a	4	9	^new
PRO HOLDINGS
PRO HOLDINGS	n/a	70	100	^new
MARKET PULSE
MARKET PULSE	n/a	50	68	^new
CONSOLIDATED RANK: SENTIMENT
CONSOLIDATED RANK: SENTIMENT	n/a	63	82	^new

Last update of Sentiment Rank: 14-Nov-2024. Stock analysis on sentiment metrics: The higher the rank, the more positive the sentiment for Sumitomo Bakelite.
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