Value
7.7/10data confidence 100%| Component | Sub-score |
|---|---|
| P/E | 6.0 |
| P/S | 9.7 |
| EV/EBITDA | 7.7 |
| Fwd P/E | 9.0 |
| PEG | 10.0 |
| Analyst target | 4.0 |
- ▸Forward P/E: 11.8x
- ▸PEG: 0.23
- ▸Attractively valued
ICL · Why this verdict
Why ICL Group (ICL) is rated SELL
Updated
Model-generated analysis — not investment advice. Not a registered investment advisor. Past performance does not guarantee future results.
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VerdictSELL
Overall score5.7/10
ConfidenceMEDIUM
MacroRISK_OFF
TrendMatrix Research · core thesis
Engine thesis — one sentence
Attractive valuation metrics and an oversold technical setup offer a potential entry point with approximately 15% upside at a favorable risk/reward, but critically weak cash conversion — only 21 cents of each dollar of reported net income converts to free cash flow — and a dividend that appears inadequately backed by actual cash generation are material concerns that cap conviction.
Falsifiable statement — pillar-level invalidators below. Engine-derived; not personalized advice.
Thesis pillars
| Pillar | Expectation | Trend |
|---|---|---|
With an RSI at 26 — deeply oversold — and a rising on-balance volume trend, the technical setup suggests selling pressure may be exhausting and buyers may be accumulating despite the price weakness. Momentum breakdown | Price recovers toward the 15% upside target within 12 months as the oversold condition unwinds and volume accumulation persists. | ↓Deteriorating |
| CounterThe 200-day moving average slope is flat, providing no trend tailwind — an oversold bounce can fail quickly if the underlying long-term trend is not rising to support the recovery. | ||
At a forward P/E of 12.8 times and a PEG ratio of 0.32, the shares screen attractively valued — a PEG well below 1.0 implies the market is not pricing the earnings growth outlook at a premium. Valuation breakdown | The forward multiple expands toward 16 times over the next 12 months as the market re-rates the growth profile, consistent with closing the current discount. | Tripped↑Improving |
| CounterCheap valuation is often a function of below-average quality, and with the quality score just below the investment-grade floor, the discount may reflect persistent earnings quality concerns rather than a temporary misvaluation. | ||
Only 21 cents of every dollar of reported net income converts to free cash flow, flagged as an earnings quality concern — this disconnect between accounting profits and actual cash generation introduces risk that reported earnings overstate the true economic earning power of the business. Quality breakdown | If this pillar is wrong, FCF/NI rises above 60% for 2 consecutive quarters, narrowing the gap between reported earnings and cash generation. | →Stable |
| CounterThe Piotroski F-Score of 8 out of 9 — near the maximum — suggests the balance sheet and operating metrics are broadly healthy, implying the low cash conversion may reflect a timing or working-capital factor rather than a permanent quality deficiency. | ||
The dividend has been flagged as high-yielding but inadequately supported by cash generation — a yield that appears attractive on the surface but may not be sustainable given the critically low free cash flow conversion. Catalyst breakdown | If this pillar is wrong, FCF/NI rises above 100% for 2 consecutive annual periods, demonstrating the dividend is now well covered and the safety concern resolved. | ↑Improving |
| CounterA strong Piotroski F-Score alongside positive earnings growth may signal the business is investing working capital or capital expenditure for future growth, rather than experiencing a structural breakdown in cash generation. | ||
With an RSI at 26 — deeply oversold — and a rising on-balance volume trend, the technical setup suggests selling pressure may be exhausting and buyers may be accumulating despite the price weakness.
↓DeterioratingMomentum breakdown
- Expectation
- Price recovers toward the 15% upside target within 12 months as the oversold condition unwinds and volume accumulation persists.
CounterThe 200-day moving average slope is flat, providing no trend tailwind — an oversold bounce can fail quickly if the underlying long-term trend is not rising to support the recovery.
At a forward P/E of 12.8 times and a PEG ratio of 0.32, the shares screen attractively valued — a PEG well below 1.0 implies the market is not pricing the earnings growth outlook at a premium.
Tripped↑ImprovingValuation breakdown
- Expectation
- The forward multiple expands toward 16 times over the next 12 months as the market re-rates the growth profile, consistent with closing the current discount.
CounterCheap valuation is often a function of below-average quality, and with the quality score just below the investment-grade floor, the discount may reflect persistent earnings quality concerns rather than a temporary misvaluation.
Only 21 cents of every dollar of reported net income converts to free cash flow, flagged as an earnings quality concern — this disconnect between accounting profits and actual cash generation introduces risk that reported earnings overstate the true economic earning power of the business.
→StableQuality breakdown
- Expectation
- If this pillar is wrong, FCF/NI rises above 60% for 2 consecutive quarters, narrowing the gap between reported earnings and cash generation.
CounterThe Piotroski F-Score of 8 out of 9 — near the maximum — suggests the balance sheet and operating metrics are broadly healthy, implying the low cash conversion may reflect a timing or working-capital factor rather than a permanent quality deficiency.
The dividend has been flagged as high-yielding but inadequately supported by cash generation — a yield that appears attractive on the surface but may not be sustainable given the critically low free cash flow conversion.
↑ImprovingCatalyst breakdown
- Expectation
- If this pillar is wrong, FCF/NI rises above 100% for 2 consecutive annual periods, demonstrating the dividend is now well covered and the safety concern resolved.
CounterA strong Piotroski F-Score alongside positive earnings growth may signal the business is investing working capital or capital expenditure for future growth, rather than experiencing a structural breakdown in cash generation.
Per-dimension breakdown
Quality
4.3/10data confidence 100%| Component | Sub-score |
|---|---|
| ROE | 1.9 |
| ROA | 2.7 |
| Gross margin | 2.1 |
| Op margin | 5.0 |
| Net margin | 2.0 |
| Current ratio | 5.8 |
| FCF quality | 3.4 |
| Moat | 5.6 |
| Piotroski F | 10.0 |
- ▸Earnings quality RED FLAG: 42% FCF/NI
- ▸Strong Piotroski F-Score: 9/9
Growth
8.3/10data confidence 67%| Component | Sub-score |
|---|---|
| Rev growth | 6.6 |
| EPS growth | 10.0 |
Momentum
1.6/10data confidence 100%| Component | Sub-score |
|---|---|
| RSI | 3.0 |
| MACD | 2.6 |
| OBV | 1.0 |
| MA position | 1.5 |
| Volume | 0.0 |
- ▸Capitulation risk (RSI 18, below 200MA)
- ▸Volume distribution (falling OBV)
- ▸Below 200-MA, MA slope flat
Sentiment
5.5/10data confidence 100%| Component | Sub-score |
|---|---|
| LLM sentiment | 4.9 |
| Analyst rating | 5.0 |
| Price target | 6.9 |
Insider
4.3/10data confidence 75%| Component | Sub-score |
|---|---|
| materiality | 5.0 |
| holder change | 5.0 |
| notable moves | 3.0 |
- ▸No net insider activity — $0 (0.000% of mkt cap)
Peer rank
4.7/10data confidence 80%| Component | Sub-score |
|---|---|
| value rank | 4.2 |
| quality rank | 4.2 |
| growth rank | 6.7 |
Technical
8.1/10data confidence 100%| Component | Sub-score |
|---|---|
| bollinger | 9.7 |
| support resistance | 9.7 |
| 52w position | 4.9 |
Risk (lower is worse)
8.2/10data confidence 100%| Component | Sub-score |
|---|---|
| short interest | 9.7 |
| days to cover | 7.5 |
| volatility | 6.8 |
| put call | 10.0 |
| implied vol | 8.6 |
| beta | 7.0 |
| debt equity | 7.9 |
Catalyst
5.2/10data confidence 100%| Component | Sub-score |
|---|---|
| erm | 5.0 |
| earnings timing | 5.0 |
| surprise avg | 5.2 |
| dividend safety | 3.0 |
| news activity | 8.0 |
- ▸Yield trap warning: high yield but unsafe
How the verdict was assembled
Engine trigger
Multiple concerning factors. Consider reducing position.
Engine technical detail
verdict_path:
L4:PATH_F_SELLPassed (6)
- INSIDER:OK
- 8K:CLEAN
- NEWS_EVENTS:NONE_RECENT
- EARNINGS_PROXIMITY:46d clear
- SEMI_CYCLE_PEAK:CLEAR
- MATERIALS_CYCLE_PEAK:CLEAR
Failed (2)
- MOMENTUM:1.6<4.5
- ASYMMETRY:-0.8=NEGATIVE
Warning (0)
none
Reward-to-Risk
-0.76
Upside
-3.8%
Downside
5.0%
Sizing output
AVOID
Setup— — No clear chart pattern; technical signals are mixed
EdgeNo clear edge — No clear edge identified
SuitabilityModerate — Balanced profile
Investment implication
The F-path SELL output reflects an overall score of 5.1 below the 5.6 soft trigger — multiple weakening dimensions accumulated rather than a single hard-floor breach. The strongest dimension ( Growth at 8.3) was not enough to lift the adjusted overall above the threshold. Co-occurring failed gates ( MOMENTUM:1.6<4.5, ASYMMETRY:-0.8=NEGATIVE) reinforce the read. Current asymmetry R:R is -0.76 — supplementary context, not the trigger for this path.
The strongest dimensions are Growth at 8.3, Risk (lower is worse) at 8.2, and Technical at 8.1; the weakest are Momentum at 1.6, Insider at 4.3, and Quality at 4.3. The V9 engine flagged 2 failed gates, producing an asymmetric reward-to-risk of -0.76 and an engine sizing output of AVOID.
What would invalidate the thesis
Falsifying conditions — when triggered, the corresponding pillar's thesis is invalidated.
- P1Attractive Valuation MetricsTripped
Trip ifForward P/E expands above 18x, indicating the valuation discount has been eliminated and the value thesis is no longer valid.
- P2Critically Weak Cash Conversion
Trip ifFCF/NI ratio rises above 60% for 2 consecutive quarters, indicating a material improvement in cash conversion quality.
- P3Oversold Setup With Volume Accumulation
Trip ifRSI falls below 20 for 2 consecutive weeks, indicating continued selling pressure rather than a technical recovery from the oversold level.
- P4Dividend Yield Trap Risk
Trip ifFCF/NI ratio rises above 100% for 2 consecutive annual periods, indicating free cash flow now fully covers reported earnings and the dividend safety concern is resolved.