Allsec Technologies downgraded to 'Hold' by MarketsMOJO, but shows strong financial performance and bullish trend

Allsec Technologies, a smallcap BPO/ITeS company, has recently been downgraded to a 'Hold' by MarketsMOJO on May 7, 2024. This decision was based on various factors, including the company's low Debt to Equity ratio, which is currently at 0 times.
However, the company has shown positive results for the last 4 consecutive quarters, with its PBDIT(Q) at the highest of Rs 35.24 cr, PBT LESS OI(Q) at Rs 24.21 cr, and NET SALES(Q) at Rs 129.71 cr. This indicates a strong financial performance by the company.

Technically, the stock is currently in a Bullish range and has shown improvement since May 3, 2024, generating a return of 16.6%. Multiple factors such as MACD, Bollinger Band, KST, DOW, and OBV are also indicating a bullish trend for the stock.

With a ROE of 19.8, the stock is fairly valued with a Price to Book Value of 5.6. However, it is currently trading at a premium compared to its average historical valuations. In the past year, the stock has generated a return of 110.54%, while its profits have risen by 31%. The PEG ratio of the company is also at a healthy 0.7.

Allsec Technologies has also shown market-beating performance in the long term, outperforming BSE 500 in the last 3 years, 1 year, and 3 months.

On the other hand, the company has shown poor long term growth, with Net Sales growing at an annual rate of 12.44% and Operating profit at 0.67% over the last 5 years.

It is also worth noting that despite being a smallcap company, domestic mutual funds hold only 0% of the company. This could signify that they are not comfortable with the current price or the business, as domestic mutual funds have the capability to conduct in-depth research on companies.

Overall, while Allsec Technologies has shown strong financial performance and a bullish trend in the short term, its long term growth and lack of interest from domestic mutual funds may be a cause for concern. Investors are advised to hold onto their stocks for now and keep an eye on the company's future performance.