September 5, 2024
Top 10 Stock Demant 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: Demant – Top 10 Stock in OMX Copenhagen 20
Demant is listed as a top 10 stock on September 05, 2024 in the market index OMX C20 because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company is growing above average, but all other facts speak against a stock purchase, especially the low market sentiment by professional investors. Based on the Obermatt 360° View of 17 (17% performer), Obermatt issues an overall sell recommendation for Demant on September 05, 2024.
Snapshot: Obermatt Ranks
| Country | Denmark |
| Industry | Health Care Equipment |
| Index | OMX C20, Employee Focus EU, Human Rights |
| 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 Demant Sell
| 360 METRICS | September 5, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 19 |
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| GROWTH | ||||||||
| GROWTH | 89 |
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| SAFETY | ||||||||
| SAFETY | 8 |
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| SENTIMENT | ||||||||
| SENTIMENT | 29 |
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| 360° VIEW | ||||||||
| 360° VIEW | 17 |
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ANALYSIS: With an Obermatt 360° View of 17 (better than 17% compared with alternatives), overall professional sentiment and financial characteristics for the stock Demant are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for Demant. The consolidated Growth Rank has a good rank of 89, which means that the company experiences above-average growth momentum when looking at financial metrics such as revenue, profit, and invested capital growth, as well as stock returns. It ranks higher than 89% of competitors in the same industry. The other indicators are below average, namely the Value, Safety, and Sentiment Ranks.The Value Rank at 19 means that the share price of Demant is on the high side compared with its peers regarding revenues, profits, and invested capital. The stock price is higher than for 81% of alternative stocks in the same industry. The consolidated Safety Rank has a riskier rank of 8, which means that the company has a riskier financing structure than 92% comparable companies when looking at the amount of its debt, its refinancing requirements, and its ability to service debt. The consolidated Sentiment Rank also has a low rank of 29, indicating professional investors are more pessimistic about the stock than for 71% of alternative investment opportunities. ...read more
RECOMMENDATION: With a consolidated 360° View of 17, Demant is worse than 83% of all alternative stock investment opportunities based on the Obermatt Method. This means that Demant shares are on the riskier side for investors. As only one of the consolidated Obermatt Ranks exhibits excellent performance, namely the above-average growth (Growth Rank of 89), it is a riskier stock investment proposition. Aside from the critical professional market sentiment (Sentiment Rank of 29), the company is rather risky when it comes to financing (Safety Rank of 8). The negative market view on Demant may be due to the high stock price (low value). A growth company like this may get too expensive at one point in time. If too many investors are desperate to join the party, they may drive stock prices above reasonable levels. While it is typical for growth companies to have low value, because investors are willing to pay more for companies that are expected to have high growth, the crucial question is: how much more do you pay for the stock of Demant compared with alternatives? You can use the following rule of thumb: The value rank shouldn’t be lower than one minus the growth rank. For example, if the growth rank is at 75, and the value rank is at 5, you should tread carefully. If the value rank is at 40, it still might be a good value (even though it is lower than 50). As market sentiment is critical, you should be careful with paying more than market-average for this stock and conduct further research into the company's future growth potential. ...read more
Sentiment Strategy: Professional Market Sentiment for Demant only reserved
ANALYSIS: With an Obermatt Sentiment Rank of 29 (better than 29% compared with alternatives), overall professional sentiment and engagement for the stock Demant is below industry average. The Sentiment Rank is based on consolidating four sentiment indicators, with half of the metrics below and half above average for Demant. Analyst Opinions are at a rank of 27 (worse than 73% of alternative investments), which means that currently, stock research analysts tend to warn against investing in the stock of the company. Worse, Analyst Opinions Change has a rank of 35, which means that stock research experts are getting even more pessimistic. Other sentiment indicators are positive: The Professional Investors rank is 62, which means that professional investors hold more stock in this company than in 62% of alternative investment opportunities. So, pros tend to favor investing in this company. In addition, Market Pulse has a rank of 56, which means that the current professional news and professional social networks tend to be positive when discussing this company (more positive news than for 56% of competitors). While stock research analysts are getting ever more critical, many professional investors are committed to Demant and the professional news channels are on the positive side. ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 29 (less encouraging than 71% compared with investment alternatives), Demant has a reputation among professional investors that is below that of its competitors. This is an ambiguous picture: analysts are negative and getting even more critical, while the news in the market is positive. Who should investors believe? This is a difficult question in such a situation. Investors should proceed cautiously and verify not only the financial performance in the Obermatt Value, Growth and Safety Ranks but also independent news coverage of the company. ...read more
Value Strategy: Demant Stock Price Value low
ANALYSIS: With an Obermatt Value Rank of 19 (worse than 81% compared with alternatives), Demant shares are significantly more expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with all four indicators below average for Demant. Price-to-Sales is 36 which means that the stock price compared with what market professionals expect for future profits is higher than 64% of comparable companies, indicating a low value concerning Demant's sales levels. Price-to-Book Capital (also referred to as market-to-book ratio) also has a low Price-to-Book Rank of 10, which means that both reliable company size indicators, sales, and invested capital cannot explain the high stock price of Demant. In addition, the two profit-related value indicators, Price-to-Profit (also referred to as price-earnings, P/E) with a low rank of 42 and Dividend Yield, which is lower than 99% 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 19, is a sell recommendation based on Demant's stock price compared with the company's operational size and dividend yields. How can market participants pay such a high price for Demant? 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 Demant? 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. Demant 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. ...read more
Growth Strategy: Demant Growth Momentum high
| GROWTH METRICS | September 5, 2024 | |||||||
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| REVENUE GROWTH | ||||||||
| REVENUE GROWTH | 50 |
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| PROFIT GROWTH | ||||||||
| PROFIT GROWTH | 88 |
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| CAPITAL GROWTH | ||||||||
| CAPITAL GROWTH | 85 |
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| STOCK RETURNS | ||||||||
| STOCK RETURNS | 45 |
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| CONSOLIDATED RANK: GROWTH | ||||||||
| CONSOLIDATED RANK: GROWTH | 89 |
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ANALYSIS: With an Obermatt Growth Rank of 89 (better than 89% compared with alternatives) for 2024, Demant 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 but one indicator above average for Demant. Sales Growth has a value of 50 which means that currently professionals expect the company to grow more than 50% of its competitors. Profit Growth with a value of 88 and Capital Growth with a rank of 85 means that currently, professionals expect the company to grow both profits and invested capital more than of its competitors. But Stock Returns has only a rank of 45, which means that stock returns have recently been below 55% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 89, is a buy recommendation for growth and momentum investors. Demant has only one below-average growth indicator, the stock returns. This is probably the least reliable growth indicator, because it measures company and investor expectations at the same time. The three other growth indicators, which are all positive for Demant, are more reliable measures of growth momentum. For this reason, the company seems to be on a good trajectory, unless you think the current period is not representative, because of unique events that will not be repeated in the future. ...read more
Safety Strategy: Demant Debt Financing Safety risky
| SAFETY METRICS | September 5, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 7 |
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| REFINANCING | ||||||||
| REFINANCING | 24 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 46 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 8 |
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ANALYSIS: With an Obermatt Safety Rank of 8 (better than 8% compared with alternatives), the company Demant 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 Demant 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 all three metrics below average for Demant. Liquidity is at 46, meaning that the company generates less profit to service its debt than 54% of its competitors. This indicates that the company is on the riskier side when it comes to debt service. Even worse, Leverage is at a rank of 7, meaning the company has an above-average debt-to-equity ratio. It has more debt than 93% of its competitors. Finally, Refinancing is at a rank of 24 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 76% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 8 (worse than 92% compared with alternatives), Demant has a financing structure that is significantly riskier than that of its competitors. This combination is rather dangerous in most situations. Only very promising companies with bright future outlooks and stellar reputations can operate with such risky financing.
Combined financial peformance: Demant Lowest Financial Performance
| COMBINED PERFORMANCE | September 5, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 19 |
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| GROWTH | ||||||||
| GROWTH | 89 |
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| SAFETY | ||||||||
| SAFETY | 46 |
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| COMBINED | ||||||||
| COMBINED | 19 |
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ANALYSIS: With an Obermatt Combined Rank of 19 (worse than 81% compared with investment alternatives), Demant (Health Care Equipment, Denmark) shares have lower financial characteristics compared with similar stocks. Shares of Demant are low in value (priced high) with a consolidated Value Rank of 19 (worse than 81% of alternatives), and are riskily financed (Safety Rank of 8, which means above-average debt burdens) but show above-average growth (Growth Rank of 89). ...read more
RECOMMENDATION: A Combined Rank of 19, is a sell recommendation based on Demant's financial characteristics. As the company Demant shows low value with an Obermatt Value Rank of 19 (81% of comparable investments are less expensive), investors should look at the other ranks. In this case, growth is expected to be above-average, better than 89% of comparable companies (Obermatt Growth Rank is 89). This is a typical case. Companies with above average growth tend to cost more than stocks with slower growth expectations. If this is a high-growth company, the low Obermatt Safety Rank of 8 is a good sign. The more debt a well-performing company has, the higher the returns to shareholders. However, if growth turns negative or interest rates increase, high debt may become a burden. If you believe the future is bright for Demant, even a low-value company (in terms of its key financial indicators) can be a good investment. ...read more
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