October 3, 2024
Top 10 Stock NOS 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: NOS – Top 10 Stock in Telecommunications
NOS is listed as a top 10 stock on October 03, 2024 in the market index Telecommunications because of its high performance in at least one of the Obermatt investment strategies. Only one consolidated Obermatt Rank is above-average. The company enjoys a positive professional investor sentiment, but all financial facts speak against a stock purchase. This is probably an investment into the future. Based on the Obermatt 360° View of 18 (18% performer), Obermatt issues an overall sell recommendation for NOS on October 03, 2024.
Snapshot: Obermatt Ranks
| Country | Portugal |
| Industry | Integrated Telecommunication |
| Index | Dividends Europe, Renewables Users, Telecommunications, PSI General, PSI 20 |
| 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 NOS Sell
| 360 METRICS | October 3, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 45 |
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| GROWTH | ||||||||
| GROWTH | 17 |
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| SAFETY | ||||||||
| SAFETY | 10 |
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| SENTIMENT | ||||||||
| SENTIMENT | 69 |
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| 360° VIEW | ||||||||
| 360° VIEW | 18 |
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ANALYSIS: With an Obermatt 360° View of 18 (better than 18% compared with alternatives), overall professional sentiment and financial characteristics for the stock NOS are critical, mostly below average. The 360° View is based on consolidating four consolidated indicators, with three out of four indicators below average for NOS. The consolidated Sentiment Rank has a good rank of 69, which means that professional investors are more optimistic about the stock than for 69% of alternative investment opportunities. But all other ranks are below average. The consolidated Value Rank has a rank of 45, which means that the share price of NOS is on the higher side compared with typical size in indicators such as revenues, profits, and invested capital. The consolidated Growth Rank also has a low rank of 17, meaning that the company exhibits below-average growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. This means that growth is lower than for 17% of competitors in the same industry. Finally, the consolidated Safety Rank has a riskier rank of 10 which means that the company has a riskier financing structure than 90% 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 18, NOS is worse than 82% of all alternative stock investment opportunities based on the Obermatt Method. This means that NOS shares are on the riskier side for investors. As only the professional market sentiment (Sentiment Rank of 69) is above-average, and all other consolidated Obermatt Ranks are below peers, the stock investing proposition case is rather weak. The stock price is expensive for a company of this size in this industry, visible in the below-average Value Rank. Growth is below the competition based on the Growth Rank, and the company has more debt than other companies, according to the Safety Rank. So the question becomes: How important is the Sentiment Rank when all others are below average? When it comes to growth, the low rating might be justified if growth is expected in the future and not yet reflected in current performance. This is often the case for companies with intellectual property, such as technology and pharmaceutical companies. In the early phases, these companies are expensive compared with their size and may have a lot of debt on their books, as is the case here, as seen in the low Value and Safety Ranks. Future growth may be the strongest investment rationale in this case, which is only reflected by institutional investors' opinions. You pay more than the market average for this stock and invest in a rather debt-loaded enterprise, but it may be worth it if the future of NOṢ is bright. A small investment might be justified, but proceed with caution. ...read more
Sentiment Strategy: Professional Market Sentiment for NOS positive
ANALYSIS: With an Obermatt Sentiment Rank of 69 (better than 69% compared with alternatives), overall professional sentiment and engagement for the stock NOS is above average. The Sentiment Rank is based on consolidating four sentiment indicators, with all but one indicator above average for NOS. 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. But they are changing their opinions! Analyst Opinions Change has a rank of 59, which indicates a shift in stock research experts opinions for the better. In other words, they are getting more optimistic about stock investments in NOS. Even better, the Professional Investors rank is 86, meaning that professional investors hold more stock in this company than in 86% of alternative investment opportunities. Pros tend to favor investing in this company. Furthermore, Market Pulse has a rank of 60, which means that the current professional news and professional social networks are upbeat when discussing this company (more positive news than for 60% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 69 (more positive than 69% compared with investment alternatives), NOS has a reputation among professional investors that is above-average compared with that of its competitors. While analysts are still critical of the company, some are changing their minds. In addition, the professional news channels are optimistic, and many institutional investors have already bought stock in the company. These are encouraging signals, despite the still lower level of analyst recommendations. They may be due to a problematic past, and about to change. The positive sentiment signals are stronger than the negative. ...read more
Value Strategy: NOS Stock Price Value below-average critical
ANALYSIS: With an Obermatt Value Rank of 45 (worse than 55% compared with alternatives), NOS shares are more expensive than the average comparable stock. The Value Rank is based on consolidating four value indicators, with three out of four indicators below average for NOS. Only the metric dividend yield has an above-average rank, reflecting that dividend practices are expected to be higher than 90% of comparable companies, making the stock an attractive buy for dividend investors. However, dividend investors may get disappointed because all other critical financial indicators are below the market median: Price-to-Sales is 30 which means that the stock price compared with what market professionals expect for future profits is higher than 70% of comparable companies, indicating a low value concerning NOS's sales levels. The same is valid for Price-to-Profit (also referred to as price-earnings, P/E) with a rank of 33 which means that the stock price compared with what market professionals expect for future profit levels is higher than 67% of comparable companies. In addition, Price-to-Book (also referred to as market-to-book ratio) with a Price-to-Book Rank of 31 is also low. Compared with invested capital, the stock price is higher than for 69% of comparable investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 45, is a hold recommendation based on NOS's stock price compared with the company's operational size and dividend yields. Should dividend investors pick NOS? The company-reported financials speak against it. The company is expensive compared with revenue and invested capital levels, two reliable company size indicators. In addition, it currently has a low level of profits. How can future dividends be paid in the case that profits remain low? Dividend investors should choose NOS only if they reasonably expect the low current profit levels to be transitory. ...read more
Growth Strategy: NOS Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 17 (better than 17% compared with alternatives), NOS 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 NOS. Sales Growth has a below market rank of 16, which means that, currently, professionals expect the company to grow less than 84% of its competitors. The same is valid for Capital Growth, with a rank of 27, and Profit Growth, with a rank of 42. Currently, professionals expect the company to grow its profits less than 58% 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 17, 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 NOS, 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: NOS Debt Financing Safety risky
| SAFETY METRICS | October 3, 2024 | |||||||
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| LEVERAGE | ||||||||
| LEVERAGE | 28 |
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| REFINANCING | ||||||||
| REFINANCING | 11 |
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| LIQUIDITY | ||||||||
| LIQUIDITY | 39 |
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| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 10 |
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ANALYSIS: With an Obermatt Safety Rank of 10 (better than 10% compared with alternatives), the company NOS 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 NOS 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 NOS. Liquidity is at 39, meaning that the company generates less profit to service its debt than 61% 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 28, meaning the company has an above-average debt-to-equity ratio. It has more debt than 72% of its competitors. Finally, Refinancing is at a rank of 11 which means that the portion of the debt about to be refinanced is above average. It has more debt in the refinancing stage than 89% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 10 (worse than 90% compared with alternatives), NOS 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: NOS Lowest Financial Performance
| COMBINED PERFORMANCE | October 3, 2024 | |||||||
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| VALUE | ||||||||
| VALUE | 45 |
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| GROWTH | ||||||||
| GROWTH | 17 |
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| SAFETY | ||||||||
| SAFETY | 39 |
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| COMBINED | ||||||||
| COMBINED | 1 |
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ANALYSIS: With an Obermatt Combined Rank of 1 (worse than 99% compared with investment alternatives), NOS (Integrated Telecommunication, Portugal) shares have lower financial characteristics compared with similar stocks. Shares of NOS are low in value (priced high) with a consolidated Value Rank of 45 (worse than 55% of alternatives), show below-average growth (Growth Rank of 17), and are riskily financed (Safety Rank of 10), which means above-average debt burdens. ...read more
RECOMMENDATION: A Combined Rank of 1, is a sell recommendation based on NOS's financial characteristics. As the company NOS's key financial metrics all exhibit below-average performance, such as low value (Obermatt Value Rank of 45), low growth (Obermatt Growth Rank of 17), and risky financing practices (Obermatt Safety Rank of 10), it is a somewhat questionable stock investment, where the risk of paying too much for the shares is significant, unless the company has an exceptionally bright future. Such poor financial performance sometimes indicates that the company's business is all concentrated in some distant future. This is sometimes the case for high-tech or biotechnology companies. If they own properties that only provide cash flows in the future, the stock may look excessively expensive and risky today. In such cases, the Obermatt Method has limited value as it is based on facts we can observe today. If the facts are all in the future, stock investing becomes guesswork, and this should only be a driver in a limited number of investments that should only amount to a small fraction of a safe portfolio. ...read more
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