Capital Trade Links Downgraded to 'Sell' by MarketsMOJO Due to Weak Fundamentals and Expensive Valuation

Capital Trade Links, a microcap finance company, has recently been downgraded to a 'Sell' by MarketsMOJO on March 20, 2024. This decision was based on the company's weak long-term fundamental strength, with an average Return on Equity (ROE) of 6.46%. Additionally, the stock is currently trading at a premium compared to its historical valuations, with a price to book value of 5.4.
One of the main reasons for the downgrade is the company's expensive valuation, with an ROE of 18.3. This is significantly higher than the industry average and indicates that the stock may be overvalued. Furthermore, while the stock has generated a return of 64.25% in the past year, its profits have only increased by 120.3%, resulting in a low PEG ratio of 0.3.

However, there are some positive factors to consider. Capital Trade Links declared very positive results in December 2023, with a growth in net profit of 325%. The company has also consistently declared positive results for the last 8 consecutive quarters. In addition, its net sales have grown by 145.23% and its PBDIT and PAT are at their highest levels.

From a technical standpoint, the stock is currently in a mildly bullish range, with both its MACD and KST technical factors showing a bullish trend. The majority of shareholders are non-institutional, and the company has consistently generated returns over the last 3 years.

Overall, while Capital Trade Links may have some positive aspects, the recent downgrade to 'Sell' by MarketsMOJO suggests caution for potential investors. It is important to carefully consider all factors before making any investment decisions.