November 14, 2024
Top 10 Stock Zyxel 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: Zyxel – Top 10 Stock in Artificial Intelligence & Big Data
Zyxel is listed as a top 10 stock on November 14, 2024 in the market index Artificial Intelligence because of its high performance in at least one of the Obermatt investment strategies. While half the consolidated Obermatt Ranks are above-average, investor sentiment is negative and growth performance is below market average, both a sign for caution. Based on the Obermatt 360° View of 47 (47% performer), Obermatt assesses an overall hold recommendation for Zyxel on November 14, 2024.
Snapshot: Obermatt Ranks
| Country | Taiwan |
| Industry | Communications Equipment |
| Index | Artificial Intelligence, FTSE Taiwan |
| 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 Zyxel Hold
| 360 METRICS | November 14, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 81 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 13 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 84 |
|
||||||
| SENTIMENT | ||||||||
| SENTIMENT | 23 |
|
||||||
| 360° VIEW | ||||||||
| 360° VIEW | 47 |
|
||||||
ANALYSIS: With an Obermatt 360° View of 47 (better than 47% compared with alternatives), overall professional sentiment and financial characteristics for the stock Zyxel are below the industry average. The 360° View is based on consolidating four consolidated indicators, with half the metrics below and half above average for Zyxel. The consolidated Value Rank has an attractive rank of 81, which means that the share price of Zyxel is on the lower side compared with the typical size in indicators such as revenues, profits, and invested capital. This means the stock price is lower than for 81% of alternative stocks in the same industry. The company is also safely financed with a Safety rank of 84. But the professional market sentiment is below average compared with other stock investment alternatives with a Sentiment Rank of 23. Professional investors are more confident in 77% other stocks. The consolidated Growth Rank also has a low rank of 13, which means that the company is below average in terms of growth momentum when looking at financial metrics such as revenue, profit, invested capital growth, and stock returns. 87 of its competitors have better growth. ...read more
RECOMMENDATION: With a consolidated 360° View of 47, Zyxel is worse than 53% of all alternative stock investment opportunities based on the Obermatt Method. The picture is mixed here. The stock seems to be a good value (Value Rank of 81), and the financing structure is on the safer side (Safety Rank of 84). However, sentiment in the professional investor community is below-average (Sentiment Rank of 23), as is the growth momentum for the company (Growth Rank of 13). Since the company is good value and the share price low, it should attract investors, yet professionals are skeptical. Even though the financing structure is not as important as Value, Growth, and Sentiment, investors should still be careful with this decision and conduct further research if they are serious about investing in this company. ...read more
Sentiment Strategy: Professional Market Sentiment for Zyxel negative
ANALYSIS: With an Obermatt Sentiment Rank of 23 (better than 23% compared with alternatives), overall professional sentiment and engagement for the stock Zyxel is critical, mostly below average. The Sentiment Rank is based on consolidating four sentiment indicators, with three out of four metrics below average for Zyxel. Analyst Opinions are at a rank of 100 (better than 100% 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 11, 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 Zyxel. The Professional Investors rank is also low at 4, meaning that professional investors hold less stock in this company than in 96% of alternative investment opportunities. Pros tend to invest in other companies. Even worse, Market Pulse has a low rank of 22, which means that the current professional news and professional social networks are critical of this company (more negative news than for 78% of competitors). ...read more
RECOMMENDATION: With a consolidated Sentiment Rank of 23 (less encouraging than 77% compared with investment alternatives), Zyxel has a reputation among professional investors that is far 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: Zyxel Stock Price Value at the top
ANALYSIS: With an Obermatt Value Rank of 81 (better than 81% compared with alternatives) for 2024, Zyxel shares are significantly less expensive than comparable stocks. The Value Rank is based on consolidating four value indicators, with three out of four indicators above average for Zyxel. Price-to-Sales (P/S) is 87, which means that the stock price compared with what market professionals expect for future sales is lower than for 87% of comparable companies, indicating a good value regarding Zyxel's revenue size. The same is valid for expected Price to Profits (or Price / Earnings, P/E), more favorable than for 89% of alternatives, and it's also true for the Price-to-Book Capital ratio (also referred to as market-to-book ratio) with a Price-to-Capital Rank of 69. But, compared with other companies in the same industry, dividend yields are expected to be lower than average; only 35% of all competitors have even lower dividend yields than Zyxel (a Dividend Yield Rank of 35). 65% alternative investments in the same business provide a higher dividend yield. ...read more
RECOMMENDATION: The overall picture with a consolidated Value Rank of 81, is a buy recommendation based on Zyxel's stock price compared with the company's operational size and dividend yields. The below-average dividend yield may be a good sign, as it could mean the company has more attractive investment opportunities for the generated cash than to pay it out as dividends. A low dividend yield can also indicate a growth phase. ...read more
Growth Strategy: Zyxel Growth Momentum negative
ANALYSIS: With an Obermatt Growth Rank of 13 (better than 13% compared with alternatives), Zyxel 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 Zyxel. While Sales Growth ranks at 77, professionals currently expect the company to grow more than 77% of its competitors, while all other growth ranks are below the market median. Profit Growth has a rank of 6, which means that, currently, professionals expect the company to grow its profits less than 94% of its competitors, and Capital Growth has a low rank of 13. Historic stock returns were also below average with a current Stock Returns rank of 19 which means that the stock returns have recently been below 81% of alternative investments. ...read more
RECOMMENDATION: The overall picture with a consolidated Growth Rank of 13, is a sell recommendation for growth and momentum investors. If revenues are expected to increase, but all other growth indicators are negative, the company may be investing in future growth through means not visible in the balance sheet and thus not reflected in capital growth. The fact that Stock Returns have been below market doesn't mean that much, as it may be due to overly optimistic investor behavior in the past, which has been corrected to a more reasonable level recently. If that were the case, a positive Value Rank would be a reason to invest because the company is still expected to grow, while stock prices are now at a more reasonable level. ...read more
Safety Strategy: Zyxel Debt Financing Safety very solid
| SAFETY METRICS | November 14, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| LEVERAGE | ||||||||
| LEVERAGE | 48 |
|
||||||
| REFINANCING | ||||||||
| REFINANCING | 97 |
|
||||||
| LIQUIDITY | ||||||||
| LIQUIDITY | 50 |
|
||||||
| CONSOLIDATED RANK: SAFETY | ||||||||
| CONSOLIDATED RANK: SAFETY | 84 |
|
||||||
ANALYSIS: With an Obermatt Safety Rank of 84 (better than 84% compared with alternatives) for 2024, the company Zyxel has safe financing practices, which means that their overall debt burden is low. This doesn't mean that the business of Zyxel is safe, it only means that the company is on the safer side regarding possible bankruptcy, assuming that public reporting is correct. The Safety Rank is based on consolidating three financing indicators, with two out of three indicators above-average for Zyxel. Refinancing is at 97, meaning the portion of the debt that is about to be refinanced is below average. It has less debt in the refinancing stage than 97% of its competitors. Liquidity is also good at 50, meaning the company generates more profit to service its debt than 50% of its competitors. This indicates that the company is safer when it comes to debt service. However, Leverage is rather large at 48, which means the company has an above-average debt-to-equity ratio. It has more debt than 52% of its competitors. ...read more
RECOMMENDATION: With a consolidated Safety Rank of 84 (better than 84% compared with alternatives), Zyxel has a financing structure that is significantly safer than that of its competitors. This is not bad if things go well. The higher debt level means better returns to shareholders if things go well. Many top-performing companies operate with higher debt levels, and Zyxel could be in that group. But if you expect the environment to turn rougher, the higher leverage could become a problem. The same is valid if you expect interest rates to rise. That could squeeze shareholder returns, which so far have benefitted from better conditions. ...read more
Combined financial peformance: Zyxel Above-Average Financial Performance
| COMBINED PERFORMANCE | November 14, 2024 | |||||||
|---|---|---|---|---|---|---|---|---|
| VALUE | ||||||||
| VALUE | 81 |
|
||||||
| GROWTH | ||||||||
| GROWTH | 13 |
|
||||||
| SAFETY | ||||||||
| SAFETY | 50 |
|
||||||
| COMBINED | ||||||||
| COMBINED | 74 |
|
||||||
ANALYSIS: With an Obermatt Combined Rank of 74 (better than 74% compared with investment alternatives), Zyxel (Communications Equipment, Taiwan) shares have above-average financial characteristics compared with similar stocks. Shares of Zyxel are a good value (attractively priced) with a consolidated Value Rank of 81 (better than 81% of alternatives), are safely financed (Safety Rank of 84, which means low debt burdens), but show below-average growth (Growth Rank of 13). ...read more
RECOMMENDATION: A Combined Rank of 74, is a buy recommendation based on Zyxel's financial characteristics. As the company Zyxel's key financial metrics exhibit good value (Obermatt Value Rank of 81) but low growth (Obermatt Growth Rank of 13) while being safely financed (Obermatt Safety Rank of 84), it may be a safer investment because companies with low debt can better withstand times of crises. Yet the good value, better than 81% of comparable companies, may also indicate that 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 and the downside is limited due to below-average financing risks. ...read more
Obermatt Portfolio Performance
We’re so convinced about our research, that we buy our stock tips.
See the performance of the Obermatt portfolio.