August 29, 2024
Top 10 Stock Vallourec 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: Vallourec – Top 10 Stock in Sound Pay Practices in Europe
Vallourec is listed as a top 10 stock on August 29, 2024 in the market index Sound Pay Europe 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 25 (25% performer), Obermatt assesses an overall hold recommendation for Vallourec on August 29, 2024.
Snapshot: Obermatt Ranks
| Country | France |
| Industry | Oil & Gas Equipment |
| Index | CAC All, SBF 120, Employee Focus EU, Energy Efficient, Sound Pay Europe |
| Size class | X-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 Vallourec Hold
| 360 METRICS | August 29, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 98 |
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| GROWTH | ||||||||
| GROWTH | 6 |
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| SAFETY | ||||||||
| SAFETY | 39 |
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| SENTIMENT | ||||||||
| SENTIMENT | 27 |
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| 360° VIEW | ||||||||
| 360° VIEW | 25 |
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ANALYSIS: With an Obermatt 360° View of 25 (better than 25% compared with alternatives), overall professional sentiment and financial characteristics for the stock Vallourec are below the industry average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Vallourec. Only the consolidated Value Rank has an attractive rank of 98, which means that the share price of Vallourec 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 98% of alternative stocks in the same industry. All other consolidated ranks are below average. The consolidated Growth Rank has a low rank of 6, 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 39, meaning the company has a riskier financing structure than 61% 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 73% of alternative investment opportunities, reflected in the consolidated Sentiment Rank of 27. ...read more
RECOMMENDATION: With a consolidated 360° View of 25, Vallourec is worse than 75% 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 98. All other ranks are below average, so proceed with caution. The company has below-average growth expectations (Growth Rank of 6), a riskier financing structure than the competition (Safety Rank of 39), and the market sentiment in the professional investor community ranking at (Sentiment Rank of 27) 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 Vallourec 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 Vallourec. 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 Vallourec only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 27 (better than 27% compared with alternatives), overall professional sentiment and engagement for the stock Vallourec is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Vallourec. Analyst Opinions are at a rank of 87 (better than 87% of alternative investments), which means that, currently, stock research analysts tend to recommend a stock investment in the company. This is a good sign, were it not for Analyst Opinions Change with a low rank of 30, which means that currently, stock research experts are changing their opinions for the worse. In other words, they are getting more critical of a stock investment in Vallourec. The Professional Investors rank is also low at 10, meaning that professional investors hold less stock in this company than in 90% of alternative investment opportunities. Pros tend to invest in other companies. Even worse, Market Pulse has a low rank of 32, which means that the current professional news and professional social networks are critical of this company (more negative news than for 68% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 27 (less encouraging than 73% compared with investment alternatives), Vallourec has a reputation among professional investors that is below that of its competitors. There are several negative sentiment signals, with only the Analyst Opinions Rank above average. This could be a stock with a long reputation for being positive but where things are worsening. Most analysts may not see it yet, but some have, and the professionals are already quite pessimistic. Proceed with caution when investing in this stock. ...read more
Value Strategy: Vallourec Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 98 (better than 98% compared with alternatives) for 2024, Vallourec shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Vallourec. Price-to-Sales is 68 which means that the stock price compared with what market professionals expect for future sales is lower than for 68% of comparable companies, indicating a good value for Vallourec's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 100% 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 73. Compared with other companies in the same industry, dividend yields of Vallourec are expected to be higher than for 100% of all competitors (a Dividend Yield rank of 100). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 98, is a buy recommendation based on Vallourec'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 Vallourec based on its detailed value metrics.
Growth Strategy: Vallourec Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 6 (better than 6% compared with alternatives), Vallourec 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 three out of four indicators below average for Vallourec. Sales Growth has a below market rank of 14, which means that, currently, professionals expect the company to grow less than 86% of its competitors. The same is valid for Capital Growth, with a rank of 9, and Profit Growth, with a rank of 20. Currently, professionals expect the company to grow its profits less than 80% of its competitors). Only shareholders are optimistic. Stock Returns are above average at a rank of 53, which means that the stock returns have recently been above 53% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 6, is a sell recommendation for growth and momentum investors. That picture may be the result for a company that has reached the bottom. All went south for Vallourec, and it still looks bad, but some investors already see light at the end of the tunnel, rewarding the stock with recent above-market stock returns. It could also mean that investors are correcting an overreaction to negative news. If that were the case, the positive stock returns are not yet a sign of recovery. Investors should look closely at the Value and Sentiment indicators before they make a stock purchasing decision, because growth is unlikely to be the driving argument behind this investment. ...read more
Safety Strategy: Vallourec Debt Financing Safety below-average
| SAFETY METRICS | August 29, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 27 |
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| REFINANCING | ||||||||
| REFINANCING | 67 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 34 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 39 |
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ANALYSIS: With an Obermatt Safety Rank of 39 (better than 39% compared with alternatives), the company Vallourec 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 Vallourec 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 Vallourec and the other two below average. Refinancing is at 67, meaning the portion of the debt about to be refinanced is below average. It has less debt in the refinancing stage than 67% of its competitors. But Leverage is high with a rank of 27, meaning the company has an above-average debt-to-equity ratio. It has more debt than 73% of its competitors. Liquidity is also on the riskier side with a rank of 34, meaning the company generates less profit to service its debt than 66% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 39 (worse than 61% compared with alternatives), Vallourec has a financing structure that is riskier 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 Vallourec 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 an investment decision. ...read more
Combined financial peformance: Vallourec Below-Average Financial Performance
| COMBINED PERFORMANCE | August 29, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 98 |
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| GROWTH | ||||||||
| GROWTH | 6 |
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| SAFETY | ||||||||
| SAFETY | 34 |
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| COMBINED | ||||||||
| COMBINED | 42 |
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ANALYSIS: With an Obermatt Combined Rank of 42 (worse than 58% compared with investment alternatives), Vallourec (Oil & Gas Equipment, France) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Vallourec are a good value (attractively priced) with a consolidated Value Rank of 98 (better than 98% of alternatives) but show below-average growth (Growth Rank of 6), and are riskily financed (Safety Rank of 39), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 42, is a hold recommendation based on Vallourec's financial characteristics. As the company Vallourec's key financial metrics exhibit good value (Obermatt Value Rank of 98) but low growth (Obermatt Growth Rank of 6) and risky financing practices (Obermatt Safety Rank of 39), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 98% 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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