CHD Chemicals Receives 'Hold' Rating from MarketsMOJO, Stock Shows Bullish Trend

CHD Chemicals, a microcap trading company, has recently received a 'Hold' rating from MarketsMOJO. This upgrade comes as the stock has shown a bullish trend and has been technically improving since June 12, 2024. One key technical factor, the Bollinger Band, has also been bullish since the same date.
In terms of valuation, CHD Chemicals has a very attractive ROCE of 1.9 and an enterprise value to capital employed ratio of 0.7. This indicates that the stock is currently trading at a discount compared to its historical valuations. Additionally, while the stock has generated a return of 48.51% in the past year, its profits have also increased by 22%. This results in a PEG ratio of 0, which is a positive sign for investors.

The majority shareholders of CHD Chemicals are non-institutional investors, which could indicate a strong belief in the company's potential. The stock has also outperformed the market (BSE 500) with a return of 48.51% compared to the market's 37.15% in the last year.

However, the company's long-term fundamental strength is weak with a -17.20% CAGR growth in operating profits over the last 5 years. It also has a high debt to EBITDA ratio of 7.29 times, indicating a low ability to service debt. The return on equity (avg) of 2.40% also signifies low profitability per unit of shareholders' funds.

In the latest quarter, CHD Chemicals reported flat results with the lowest EPS (Q) at Rs 0.02. This could be a cause for concern for investors.

Overall, while CHD Chemicals has shown a bullish trend and has attractive valuation metrics, its weak long-term fundamentals and low profitability could be a cause for caution. Investors may want to hold onto their positions for now and monitor the company's performance closely.