Cambridge Technology Enterprises Receives 'Hold' Rating from MarketsMOJO, Shows Positive Growth but Weak Fundamentals

Cambridge Technology Enterprises, a microcap IT software company, has recently received a 'Hold' rating from MarketsMOJO on April 29, 2024. This upgrade comes after the company reported positive results in December 2023, following two consecutive negative quarters. The company's PBT LESS OI(Q) has grown by an impressive 472.0%, while its NET SALES(9M) has seen a growth of 23.92%. Additionally, its PBDIT(Q) has reached its highest at Rs 13.31 cr.
Technically, the stock is currently in a bullish range and has shown improvement from being mildly bullish on April 29, 2024. Multiple factors such as MACD, Bollinger Band, and KST are also indicating a bullish trend for the stock.

Majority shareholders of Cambridge Technology Enterprises are non-institutional investors. The stock has shown market-beating performance in both the long term and near term, with a return of 91.26% in the last year and outperforming BSE 500 in the last 3 years, 1 year, and 3 months.

However, the company's long-term fundamental strength is weak, with a -22.68% CAGR growth in operating profits over the last 5 years. Its Return on Capital Employed (avg) stands at 9.48%, indicating low profitability per unit of total capital. Furthermore, with a ROCE of -3.5, the stock is currently very expensive, with a 1.8 Enterprise value to Capital Employed. It is also trading at a premium compared to its average historical valuations. In the past year, while the stock has generated a return of 91.26%, its profits have fallen by -86.5%.

Overall, MarketsMOJO's 'Hold' rating for Cambridge Technology Enterprises suggests a neutral stance for investors. While the company has shown positive growth in recent quarters, its long-term fundamentals and expensive valuation should be considered before making any investment decisions.