November 28, 2024
Top 10 Stock Engie Brasil Energia 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: Engie Brasil Energia – Top 10 Stock in Solar Technology
Engie Brasil Energia is listed as a top 10 stock on November 28, 2024 in the market index Solar Tech 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 8 (8% performer), Obermatt issues an overall sell recommendation for Engie Brasil Energia on November 28, 2024.
Snapshot: Obermatt Ranks
| Country | Brazil |
| Industry | Renewable Electricity |
| Index | BOVESPA, Low Emissions, Good Governace Growth Markets, Human Rights, Independent Boards Growth Markets, Solar Tech |
| 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 Engie Brasil Energia Sell
| 360 METRICS | November 28, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 54 |
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| GROWTH | ||||||||
| GROWTH | 44 |
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| SAFETY | ||||||||
| SAFETY | 12 |
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| SENTIMENT | ||||||||
| SENTIMENT | 18 |
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| 360° VIEW | ||||||||
| 360° VIEW | 8 |
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ANALYSIS: With an Obermatt 360° View of 8 (better than 8% compared with alternatives), overall professional sentiment and financial characteristics for the stock Engie Brasil Energia are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Engie Brasil Energia. Only the consolidated Value Rank has an attractive rank of 54, which means that the share price of Engie Brasil Energia 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 54% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 44, 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 12, meaning the company has a riskier financing structure than 88% 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 82% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 18. ...read more
RECOMMENDATION: With a consolidated 360° View of 8, Engie Brasil Energia is worse than 92% of all alternative stock investment opportunities based on the Obermatt Method. This means that Engie Brasil Energia shares are on the riskier side for investors. Only one of the consolidated Obermatt Ranks exhibits above-average performance, namely the Value Rank at a level of 54. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 44), a riskier financing structure than the competition (Safety Rank of 12), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 18) 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 Engie Brasil Energia 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 Engie Brasil Energia. 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 Engie Brasil Energia negative
ANALYSIS: With an Obermatt Sentiment Rank of 18 (better than 18% compared with alternatives), overall professional sentiment and engagement for the stock Engie Brasil Energia is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Engie Brasil Energia. Analyst Opinions are at a rank of 12 (worse than 88% 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 57, 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 Engie Brasil Energia. But the Professional Investors rank is low at 36, which means that professional investors hold less stock in this company than in 64% of alternative investment opportunities. Pros tend to invest in other companies. Market Pulse is also low at a rank of 40, which means that the current professional news and professional social networks tend to be negative when discussing this company (more negative news than for 60% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 18 (less encouraging than 82% compared with investment alternatives), Engie Brasil Energia 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: Engie Brasil Energia Stock Price Value better than average
ANALYSIS: With an Obermatt Value Rank of 54 (better than 54% compared with alternatives), Engie Brasil Energia shares are more attractively priced than the majority of comparable stocks. The Value Rank is based on consolidating four value indicators, with half of the indicators below and half above average for Engie Brasil Energia. Price-to-Profit (also referred to as price-earnings, P/E) is 78 which means that the stock price compared with what market professionals expect for future profits is lower than for 78% of comparable companies, indicating a good value concerning Engie Brasil Energia's profit levels. The same is valid for Price-to-Book Capital (also referred to as market-to-book ratio) with a Price-to-Book Rank of 24, which means that the stock price is lower as regards to invested capital than for 24% of comparable investments. On the other hand, Price-to-Sales is less favorable than 77% of alternatives (only 23% of peers have an even less favorable ratio). The same is valid for dividend yield, which is lower than 17% of comparable companies, making the stock more expensive as regards to the company's expected dividend payouts. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 54, is a buy recommendation based on Engie Brasil Energia's stock price compared with the company's operational size and dividend yields. This is a puzzling picture, because it means that profits are high while dividends are low. Since the stock price is low compared with invested capital but high in respect to expected revenues, it means that the company has more invested capital than peers for generating the same amount of revenue. Since profits are higher, it could be a "cash cow" situation (using the classic Boston Consulting BCG matrix naming convention) where the company is on a downward trend, still living from the profits of past products. As the company pays low dividends, it may harbor the opinion that a turnaround is possible, and it rather invests the cash than pay it out to shareholders, thus sealing the company's fate early. Any investment optimism should only be a buy trigger once thorough research is completed. ...read more
Growth Strategy: Engie Brasil Energia Growth Momentum low
| GROWTH METRICS | November 28, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 23 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 48 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 74 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 26 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 44 |
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ANALYSIS: With an Obermatt Growth Rank of 44 (better than 44% compared with alternatives), Engie Brasil Energia 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 three out of four indicators below average for Engie Brasil Energia. Only Capital Growth has a good rank of 74, which means that currently professionals expect the company to grow its invested capital more than 48% of its competitors. The other three indicators are pointing South: Sales Growth has a rank of 23 which means that currently professionals expect the company to grow less than 77% of its competitors. Profit Growth with a rank of 48 and Stock Returns with a rank of 26 are also low (below 74% of alternative investments). ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 44, is a hold recommendation for growth and momentum investors. The good news from the invested capital side is surprising. A company with disappointing revenues, profits, and disappointed shareholders typically doesn't invest above average. Overall, the growth momentum for Engie Brasil Energia is thus negative. As it is intriguing to see that company executives are optimistic about their investment policy, it is worthwhile looking into the details of the capital investment projects. They may indicate future growth and profits and thus if accompanied by a good value, a sign of good timing to invest in the stock. ...read more
Safety Strategy: Engie Brasil Energia Debt Financing Safety risky
| SAFETY METRICS | November 28, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 9 |
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| REFINANCING | ||||||||
| REFINANCING | 20 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 62 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 12 |
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ANALYSIS: With an Obermatt Safety Rank of 12 (better than 12% compared with alternatives), the company Engie Brasil Energia has much riskier financing practices than comparable other companies, which means that their overall debt burden is significantly above the industry average. This doesn't mean that the business of Engie Brasil Energia 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 Engie Brasil Energia. Liquidity is at 62, meaning the company generates more profit to service its debt than 62% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 20, 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 80% of its competitors. Leverage is also high at a rank of 9, which means that the company has an above-average debt-to-equity ratio. It has more debt than 91% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 12 (worse than 88% compared with alternatives), Engie Brasil Energia has a financing structure that is significantly riskier than that of its competitors. High Leverage (a low Obermatt Leverage Rank) is good in good times, because it usually indicates that shareholders get higher returns. The good Liquidity performance of the company is an indicator that this is the case. However, if you expect an economic downturn, you may stay clear of this stock because they have an above-average debt level that needs refinancing soon. ...read more
Combined financial peformance: Engie Brasil Energia Lowest Financial Performance
| COMBINED PERFORMANCE | November 28, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 54 |
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| GROWTH | ||||||||
| GROWTH | 44 |
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| SAFETY | ||||||||
| SAFETY | 62 |
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| COMBINED | ||||||||
| COMBINED | 18 |
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ANALYSIS: With an Obermatt Combined Rank of 18 (worse than 82% compared with investment alternatives), Engie Brasil Energia (Renewable Electricity, Brazil) shares have lower financial characteristics compared with similar stocks. Shares of Engie Brasil Energia are a good value (attractively priced) with a consolidated Value Rank of 54 (better than 54% of alternatives) but show below-average growth (Growth Rank of 44), and are riskily financed (Safety Rank of 12), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 18, is a sell recommendation based on Engie Brasil Energia's financial characteristics. As the company Engie Brasil Energia's key financial metrics exhibit good value (Obermatt Value Rank of 54) but low growth (Obermatt Growth Rank of 44) and risky financing practices (Obermatt Safety Rank of 12), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 54% 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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