March 28, 2024
Top 10 Stock Valmet 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: Valmet – Top 10 Stock in Optionsmäklarna Helsinki Stock Exchange Helsinki Index OMX 25
Valmet is listed as a top 10 stock on March 28, 2024 in the market index OMX 25 because of its high performance in at least one of the Obermatt investment strategies. While only half of the consolidated Obermatt Ranks exhibit above-average performance, the professional market sentiment is positive and it may be a solid investment proposition, especially if a growth recovery is to be expected soon. Based on the Obermatt 360° View of 54 (high 54% performer), Obermatt assesses an overall buy recommendation for Valmet on March 28, 2024.
Snapshot: Obermatt Ranks
| Country | Finland |
| Industry | Industrial Machinery |
| Index | OMX 25, Dividends Europe, Human Rights |
| 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 Valmet Buy
| 360 METRICS | March 28, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 76 |
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| GROWTH | ||||||||
| GROWTH | 6 |
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| SAFETY | ||||||||
| SAFETY | 45 |
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| SENTIMENT | ||||||||
| SENTIMENT | 77 |
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| 360° VIEW | ||||||||
| 360° VIEW | 54 |
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ANALYSIS: With an Obermatt 360° View of 54 (better than 54% compared with alternatives), overall professional sentiment and financial characteristics for the stock Valmet are above average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Valmet. The consolidated Value Rank has an attractive rank of 76, which means that the share price of Valmet 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 76% of alternative stocks in the same industry. The consolidated Sentiment Rank has a good rank of 77, which means that professional investors are more optimistic about the stock than for 77% of alternative investment opportunities. But 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, invested capital growth, and stock returns. The consolidated Safety Rank has a riskier rank of 45, meaning the company has a riskier financing structure than 55 comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. ...read more
RECOMMENDATION: With a consolidated 360° View of 54, Valmet is better positioned than 54% of all alternative stock investment opportunities based on the Obermatt Method. Half of the consolidated Obermatt Ranks exhibit above-average performance, but the other half are below market levels. The company enjoys a good value (Value Rank of 76) and positive market sentiment in the professional investor community (Sentiment Rank of 77), but growth expectations are below-average (Growth Rank of 6) and the financing structure is on the risky side(Safety Rank of 45). This combination is rather dangerous, because high debt levels (low safety) require growth to finance the debt burden. The current low growth level may be temporary, because professionals are actually optimistic (positive 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. Companies with less growth typically have a lower price than fast-growing competitors. Even though professional investor sentiment is strong, we recommend further evaluating whether the future of Valmet is as challenging as the stock's low price suggests. Since the professional community is optimistic, the stock might just be going through a more challenging phase now, indicating that timing might be good now. ...read more
Sentiment Strategy: Professional Market Sentiment for Valmet very positive
ANALYSIS: With an Obermatt Sentiment Rank of 77 (better than 77% compared with alternatives) for 2024, overall professional sentiment and engagement for the stock Valmet is very positive. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for Valmet. Analyst Opinions are at a rank of 78 (better than 78% of alternative investments), which means that currently, stock research analysts tend to recommend a stock investment in the company. In addition, Analyst Opinions Change has a rank of 63, which means that currently, stock research experts are getting even more optimistic. Obermatt Market Pulse further supports this with a rank of 56, which means that the current professional news and professional social networks are generally positive when discussing this company (more positive news than for 56% of competitors). But there are few stock holdings by institutional investors. The Professional Investors rank is low at 47, which means that currently, professional investors hold less stock in this company than in 53% of alternative investment opportunities. Pros tend to invest in other companies. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 77 (more positive than 77% compared with investment alternatives), Valmet has a reputation among professional investors that is significantly higher than that of its competitors. Not having too many professionals invested in Valmet may be less of an issue, especially if the stock is from a smaller company where professionals typically invest less. It is natural for professional investors to focus on large and extra-large companies, as they provide more safety. Smaller companies attract fewer professionals in the shareholder community. Overall, the signals from the professionals are still quite favorable for investments in Valmet. ...read more
Value Strategy: Valmet Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 76 (better than 76% compared with alternatives) for 2024, Valmet shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators that are all above average for Valmet. Price-to-Sales is 53 which means that the stock price compared with what market professionals expect for future sales is lower than for 53% of comparable companies, indicating a good value for Valmet's revenue size. The same is valid for expected Price-to-Profits, more favorable than for 68% 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 62. Compared with other companies in the same industry, dividend yields of Valmet are expected to be higher than for 98% of all competitors (a Dividend Yield rank of 98). ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 76, is a buy recommendation based on Valmet'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 Valmet based on its detailed value metrics.
Growth Strategy: Valmet Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 6 (better than 6% compared with alternatives), Valmet 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 all four metrics below average for Valmet. Sales Growth has a rank of 6, which means that currently professionals expect the company to grow less than 94% of its competitors. The same is valid for Profit Growth, with a rank of 31, and Capital Growth with 18. In addition, Stock Returns have a below market rank of 26, which means that the stock returns have recently been below 74% 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. These are all bad growth momentum indicators. These are negative signals for investors interested in growth companies. Value is likely good for this company, as investors may have left this stock in the cold. If that is the case, investors should look at the company's outlook, especially Sentiment performance, because it may be a turnaround situation that could entail above-average stock returns in the future. But it remains a risky bet, as no growth signals are in the green zone yet. ...read more
Safety Strategy: Valmet Debt Financing Safety below-average
| SAFETY METRICS | March 28, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 43 |
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| REFINANCING | ||||||||
| REFINANCING | 45 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 52 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 45 |
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ANALYSIS: With an Obermatt Safety Rank of 45 (better than 45% compared with alternatives), the company Valmet 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 Valmet 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 Valmet. Liquidity is at 52, meaning the company generates more profit to service its debt than 52% of its competitors. This indicates that the company is safer when it comes to debt service. But Refinancing is riskier at a rank of 45, 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 55% of its competitors. Leverage is also high at a rank of 43, which means that the company has an above-average debt-to-equity ratio. It has more debt than 57% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 45 (worse than 55% compared with alternatives), Valmet has a financing structure that is 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: Valmet Below-Average Financial Performance
| COMBINED PERFORMANCE | March 28, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 76 |
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| GROWTH | ||||||||
| GROWTH | 6 |
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| SAFETY | ||||||||
| SAFETY | 52 |
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| COMBINED | ||||||||
| COMBINED | 34 |
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ANALYSIS: With an Obermatt Combined Rank of 34 (worse than 66% compared with investment alternatives), Valmet (Industrial Machinery, Finland) shares have somewhat below-average financial characteristics compared with similar stocks. Shares of Valmet are a good value (attractively priced) with a consolidated Value Rank of 76 (better than 76% of alternatives) but show below-average growth (Growth Rank of 6), and are riskily financed (Safety Rank of 45), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 34, is a hold recommendation based on Valmet's financial characteristics. As the company Valmet's key financial metrics exhibit good value (Obermatt Value Rank of 76) but low growth (Obermatt Growth Rank of 6) and risky financing practices (Obermatt Safety Rank of 45), it may be a risky investment, because debt in times of crises can make things worse. The good value, better than 76% 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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