Coastal Corporation Receives 'Hold' Rating from MarketsMOJO After Positive Q1 Results

Coastal Corporation, a microcap company in the aquaculture industry, has recently received a 'Hold' rating from MarketsMOJO on July 9, 2024. This upgrade comes after the company reported positive results in March 2024, with a higher profit after tax of Rs 1.23 crore and the highest net sales of Rs 116.62 crore in the quarter.
The stock is currently in a mildly bullish range, with technical trends showing improvement from sideways on July 9, 2024. The Bollinger Band and KST technical factors also indicate a bullish trend. Additionally, with a ROCE of 2.9, the stock is considered to have an attractive valuation with a 1.2 enterprise value to capital employed.

However, the stock has underperformed the market in the last year, generating a return of only 5.39% compared to the market's return of 38.60%. This is due to a decrease in profits by -32.9% in the past year. The majority shareholders of Coastal Corporation are non-institutional investors.

The company's long-term fundamental strength is weak, as it has been operating at a loss. It also has a high debt to EBITDA ratio of 5.68 times, indicating a low ability to service debt. The return on capital employed has been at 9.12%, which is lower than the industry average, suggesting low profitability per unit of total capital.

Overall, while Coastal Corporation has shown positive results in the recent quarter, its long-term fundamental strength and underperformance in the market may be a cause for concern. Investors are advised to hold onto their stocks for now and monitor the company's performance in the future.