August 1, 2024
Top 10 Stock Tabcorp 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: Tabcorp – Top 10 Stock in Australian Securities Exchange Index ASX 100
Tabcorp is listed as a top 10 stock on August 01, 2024 in the market index ASX 100 because of its high performance in at least one of the Obermatt investment strategies. Only the Obermatt Value Rank exhibits above-average performance, which means that the stock is seen as critical by the professional community and other financial facts are below average, conveying mixed investment signals. Based on the Obermatt 360° View of 56 (high 56% performer), Obermatt assesses an overall buy recommendation for Tabcorp on August 01, 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 Tabcorp Buy
| 360 METRICS | August 1, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 100 |
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| GROWTH | ||||||||
| GROWTH | 35 |
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| SAFETY | ||||||||
| SAFETY | 40 |
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| SENTIMENT | ||||||||
| SENTIMENT | 37 |
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| 360° VIEW | ||||||||
| 360° VIEW | 56 |
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ANALYSIS: With an Obermatt 360° View of 56 (better than 56% compared with alternatives), overall professional sentiment and financial characteristics for the stock Tabcorp are above average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Tabcorp. Only the consolidated Value Rank has an attractive rank of 100, which means that the share price of Tabcorp is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means that the stock price is lower than for 100% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 35, which means that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth as well as stock returns. The consolidated Safety Rank has a riskier rank of 40, meaning the company has a riskier financing structure than 60% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. Finally, professionals are more pessimistic about the stock than for 63% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 37. ...read more
RECOMMENDATION: With a consolidated 360° View of 56, Tabcorp is better positioned than 56% of all alternative stock investment opportunities based on the Obermatt Method. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 100. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 35), a riskier financing structure than the competition (Safety Rank of 40), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 37) is negative. This combination is sensitive to a crisis, because high debt levels (low safety) require growth to finance the debt burden. It’s no wonder that the investor community indicators are skeptical (low sentiment). Good value is sometimes an indication that the company's future is challenging. The below-par growth performance may be the reason for this assessment. We recommend evaluating whether the future of Tabcorp is as challenging as the low price of the stock suggests. Since the professional community is pessimistic, you might need to worry about the future of Tabcorp. Only invest if you have solid reasons to believe that the low growth is temporary and the current market sentiment is an overreaction, possibly due to reputational issues in the past. ...read more
Sentiment Strategy: Professional Market Sentiment for Tabcorp only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 37 (better than 37% compared with alternatives), overall professional sentiment and engagement for the stock Tabcorp is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Tabcorp. 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 50, 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 Tabcorp. 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 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 37 (less encouraging than 63% compared with investment alternatives), Tabcorp has a reputation among professional investors that is 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: Tabcorp Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 100 (better than 100% compared with alternatives) for 2024, Tabcorp shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Tabcorp. Price-to-Sales is 95 which means that the stock price compared with what market professionals expect for future sales is lower than for 95% of comparable companies, indicating a good value for Tabcorp's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 79% 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 97. Compared with other companies in the same industry, dividend yields of Tabcorp are expected to be higher than for 76% of all competitors (a Dividend Yield rank of 76). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 100, is a buy recommendation based on Tabcorp'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 Tabcorp based on its detailed value metrics.
Growth Strategy: Tabcorp Growth Momentum low
ANALYSIS: With an Obermatt Growth Rank of 35 (better than 35% compared with alternatives), Tabcorp shows a below-average growth dynamic in its industry. There is limited 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 Tabcorp. Sales Growth has a rank of 73 which means that currently, professionals expect the company to grow more than 73% of its competitors. Capital Growth is also above 6% of competitors with a rank of 82. But Profit Growth only has a rank of 6, which means that currently professionals expect the company to grow its profits less than 94% of its competitors. And Stock Returns have also been below average with a rank of only 13. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 35, is a hold 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: Tabcorp Debt Financing Safety below-average
| SAFETY METRICS | August 1, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 70 |
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| REFINANCING | ||||||||
| REFINANCING | 21 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 32 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 40 |
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ANALYSIS: With an Obermatt Safety Rank of 40 (better than 40% compared with alternatives), the company Tabcorp has financing practices on the riskier side, which means that their overall debt burden is above the industry average. This doesn't mean that the business of Tabcorp 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 just one indicator above average for Tabcorp and the other two below average. Leverage is at a rank of 70 meaning the company has a below-average debt-to-equity ratio. It has less debt than 70% of its competitors.Refinancing is at a rank of 21, which means that the portion of the debt about to be refinanced is above-average. It has more debt in the refinancing stage than 79% of its competitors. Liquidity is at a rank of 32, meaning that the company generates less profit to service its debt than 68% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 40 (worse than 60% compared with alternatives), Tabcorp has a financing structure that is riskier than that of its competitors. This is an indication that the company is on the riskier side when it comes to debt service. There is only below-market average liquidity, and a short-term refinancing issue might be around the corner. But in the long-term, the debt levels of Tabcorp are on the safer side. ...read more
Combined financial peformance: Tabcorp Above-Average Financial Performance
| COMBINED PERFORMANCE | August 1, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 100 |
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| GROWTH | ||||||||
| GROWTH | 35 |
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| SAFETY | ||||||||
| SAFETY | 32 |
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| COMBINED | ||||||||
| COMBINED | 65 |
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ANALYSIS: With an Obermatt Combined Rank of 65 (better than 65% compared with investment alternatives), Tabcorp (Casinos & Gaming, Australia) shares have above-average financial characteristics compared with similar stocks. Shares of Tabcorp are a good value (attractively priced) with a consolidated Value Rank of 100 (better than 100% of alternatives) but show below-average growth (Growth Rank of 35), and are riskily financed (Safety Rank of 40), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 65, is a buy recommendation based on Tabcorp's financial characteristics. As the company Tabcorp's key financial metrics exhibit good value (Obermatt Value Rank of 100) but low growth (Obermatt Growth Rank of 35) and risky financing practices (Obermatt Safety Rank of 40), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 100% of comparable companies, may indicate 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. ...read more
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