What is Stock Rating on InvestSaham?

On the stock picks screening page, you'll see BUY, HOLD, or SELL labels on each stock. This is the Rating — a fundamental score automatically calculated based on company profitability and valuation. Rating helps you assess whether a stock is worth buying at its current price.

How is Rating Calculated?

Rating is calculated from two main components: 1. Profitability Score (55% weight) Assesses how profitable the company is: • ROE (Return on Equity) — How efficiently the company generates profit from its own equity. Benchmark: 25%. Read at What is ROE. • NPM (Net Profit Margin) — What percentage of revenue becomes net profit. Benchmark: 25%. Read at What is NPM. • EPS Growth — Earnings per share growth compared to last year. Read at What is EPS. Each is normalized to a 0–100 scale, then averaged. 2. Valuation Score (45% weight) Assesses whether the stock price is cheap or expensive: • Current PER vs Fair PER — Fair PER is automatically calculated based on ROE, earnings growth, industry sector, and historical PER. If current PER is below Fair PER, the score is high. Read at What is PER. • Current PER vs Historical Median PER — Compared to the 5-year average PER. If currently cheaper than historical average, the score is high. Final Score = (Profitability × 55%) + (Valuation × 45%)

What BUY, HOLD, and SELL Mean

After the Final Score is calculated (0–100 scale), it's categorized: • BUY (score ≥ 75) — Company is profitable AND price is relatively cheap. This is the ideal combination: good fundamentals + attractive valuation. • HOLD (score 55–74) — Could mean good fundamentals but price is already expensive, or average fundamentals but price is cheap enough. Needs further analysis. • SELL (score < 55) — Low profitability AND/OR price is too expensive. Doesn't mean you must sell immediately, but it's a signal to be more cautious. Important: Rating is an indicator, not a buy/sell recommendation. Always combine with technical analysis (RSI, MACD, support/resistance) and your own research.

Rating Calculation Example

Let's say BBCA stock: Profitability Score: • ROE 22% → score 88/100 (22/25 × 100) • NPM 38% → score 100/100 (above benchmark, capped) • EPS Growth 12% → score 73/100 ((12+10)/30 × 100) • Average = (88 + 100 + 73) / 3 = 87 Valuation Score: • Current PER 18x, Fair PER 20x → score 65/100 (slightly cheap) • Historical median PER 22x → score 73/100 (cheaper than usual) • Average = (65 + 73) / 2 = 69 Final Score = (87 × 0.55) + (69 × 0.45) = 47.85 + 31.05 = 78.9 Rating: BUY — Excellent profitability and valuation is still reasonable.

Rating vs F-Score: What's the Difference?

Many people confuse Rating with F-Score. Both evaluate fundamentals, but from different angles: Rating • Evaluates: Is this stock worth buying AT THE CURRENT PRICE? • Components: Profitability (ROE, NPM, Growth) + Valuation (PER) • Output: BUY / HOLD / SELL (score 0–100) • Best for: Determining if the current price is attractive F-Score (Piotroski) • Evaluates: Are the company's FUNDAMENTALS IMPROVING? • Components: 9 criteria (profit, cash flow, debt, efficiency) • Output: Score 0–9 • Best for: Filtering companies with improving conditions Ideally use both: • Rating BUY + High F-Score (≥7) = Cheap stock with improving fundamentals. Best combination. • Rating BUY + Low F-Score = Cheap price but fundamental issues. Beware of value trap. • Rating SELL + High F-Score = Improving fundamentals but price is already expensive. Wait for correction.

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Practical Tips

Rating BUY doesn't guarantee price increase — still check technicals before entering
Combine Rating with F-Score for a more complete fundamental picture
Pay attention to which component is weak: profitability or valuation?
Rating can change every quarter when new financial reports come out
Don't ignore HOLD stocks — sometimes just wait for a small price drop to become BUY

Common Mistakes

Thinking Rating BUY = price will definitely rise. Rating evaluates fundamentals, not price prediction
Ignoring Rating SELL just because the stock is rising or viral
Only looking at the BUY/HOLD/SELL label without checking the detailed score
Confusing Rating with F-Score — they evaluate different things

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FAQ

Is Rating the same as F-Score?

No. Rating evaluates profitability + valuation (is it worth buying at the current price). F-Score evaluates 9 Piotroski criteria (are fundamentals improving). They complement each other — use both for more complete analysis.

Why can a good company get a SELL Rating?

Because Rating also evaluates valuation (45%). A stock with good fundamentals but a very high price (high PER) can score low on valuation, resulting in a total score below 55 (SELL). This doesn't mean the company is bad, but the price is too expensive.

How often does Rating change?

Rating changes when the stock price changes (affects PER/valuation) or when new financial reports are released (affects ROE, NPM, EPS Growth). Re-check every quarter for the latest updates.

What is Stock Rating on InvestSaham?

How is Rating Calculated?

What BUY, HOLD, and SELL Mean

Rating Calculation Example

Rating vs F-Score: What's the Difference?

Learn More

Practical Tips

Common Mistakes

Related Reading

Next Step

FAQ

What is Stock Rating on InvestSaham?

How is Rating Calculated?

What BUY, HOLD, and SELL Mean

Rating Calculation Example

Rating vs F-Score: What's the Difference?

Learn More

Practical Tips

Common Mistakes

Related Reading

Next Step

FAQ