Accel receives 'Hold' rating from MarketsMOJO after positive results and bullish outlook

Accel, a microcap IT hardware company, has recently received a 'Hold' rating from MarketsMOJO on September 9, 2024. This upgrade comes after the company's positive results in June 2024, with a higher PAT (HY) of Rs 2.20 crore.
The stock is currently in a mildly bullish range and has shown improvement in its technical trend since September 6, 2024, generating a return of 9.98% since then. Multiple factors, such as MACD, Bollinger Band, and KST, indicate a bullish outlook for the stock.

Accel also has an attractive valuation with a ROCE of 7.8 and a 1.7 Enterprise value to Capital Employed. It is currently trading at a discount compared to its average historical valuations. In the past year, the stock has generated a return of 21.81%, while its profits have risen by 23.6%. However, the company's PEG ratio of 1.8 suggests that it may not have much future potential for growth.

The majority shareholders of Accel are its promoters, indicating their confidence in the company. However, the company has a high Debt to EBITDA ratio of 7.35 times, which may affect its ability to service debt. Additionally, its Return on Equity (avg) of 2.34% signifies low profitability per unit of shareholders' funds.

In the last year, Accel has underperformed the market, generating a return of 21.81%, much lower than the market (BSE 500) returns of 33.83%. While the company has shown healthy long-term growth in net sales and operating profit, it may be wise for investors to hold off on investing in Accel until its debt situation and profitability improve.