CEAT Receives 'Buy' Rating as Stock Shows Bullish Trend and Attractive Valuation.

CEAT, a midcap company in the tyres and allied industry, has recently received a 'Buy' rating from MarketsMOJO. This upgrade comes as the stock has shown a bullish trend and has generated a return of 1.59% since October 7, 2024.
One of the main reasons for this upgrade is the stock's attractive valuation with a ROCE of 19.8 and an enterprise value to capital employed ratio of 2.4. Additionally, the stock is currently trading at a discount compared to its historical valuations.

In the past year, CEAT has not only generated a return of 41.30%, but its profits have also increased by 103.4%. This is reflected in the company's low PEG ratio of 0.2, indicating its potential for future growth.

Moreover, the stock has a high institutional holding of 35.86%, which shows that these investors have better resources and capabilities to analyze the company's fundamentals.

CEAT has also shown consistent returns over the last 3 years, outperforming the BSE 500 index in each of the last 3 annual periods.

However, there are some risks associated with investing in CEAT. The company's results for the quarter ending June 2024 showed a decline in profits, with PAT(Q) falling by -12.7% and PBDIT(Q) at its lowest at Rs 382.88 crore. Additionally, the operating profit to net sales (Q) was also at its lowest at 11.99%.

Overall, with its recent 'Buy' rating and strong fundamentals, CEAT seems to be a promising investment opportunity in the midcap segment of the tyres and allied industry.