Beryl Drugs Downgraded to 'Sell' by MarketsMOJO, Weak Fundamentals Raise Concerns

Beryl Drugs, a microcap pharmaceutical company, has recently been downgraded to a 'Sell' by MarketsMOJO on April 10, 2024. This decision was based on several factors, including weak long-term fundamental strength with an average Return on Capital Employed (ROCE) of 5.27%, poor long-term growth with net sales growing at an annual rate of 14.92% and operating profit at 0.44% over the last 5 years, and a high debt to EBITDA ratio of 3.04 times, indicating a low ability to service debt.
In addition, the company's recent results for December 2023 showed a decline in net sales by -6.47%. However, there are some bullish factors for the stock, such as being in a mildly bullish range and having multiple bullish indicators like MACD, Bollinger Band, and KST. The stock also has an attractive valuation with a ROCE of 14 and a 1.7 enterprise value to capital employed. It is currently trading at a discount compared to its historical valuations.

Furthermore, Beryl Drugs has consistently generated returns over the last 3 years, outperforming the BSE 500 index in each of the last 3 annual periods. Despite the stock generating a return of 148.81% in the last year, its profits have only risen by 94%, resulting in a PEG ratio of 0. This indicates that the stock may be overvalued.

It is worth noting that the majority of shareholders in Beryl Drugs are non-institutional investors. Overall, while the stock may have some bullish indicators, the recent downgrade to 'Sell' by MarketsMOJO and the company's weak long-term fundamentals suggest caution for potential investors.