Competent Automobiles Company downgraded to 'Hold' by MarketsMOJO on recent financial results

Competent Automobiles Company, a microcap trading company, has recently been downgraded to a 'Hold' by MarketsMOJO on July 1, 2024. This decision was based on the company's recent financial results and technical factors.
In the first half of 2024, the company saw a positive growth in net sales, which increased by 20.07%. Additionally, its operating profit to interest ratio reached a high of 4.30 times and its PBDIT (profit before depreciation, interest, and taxes) was at its highest at Rs 24.75 crore.

Technically, the stock is currently in a mildly bullish range and both its MACD and KST factors are also bullish. With a ROCE (return on capital employed) of 10.7, the company has an attractive valuation with an enterprise value to capital employed ratio of 1.1. Furthermore, the stock is currently trading at a discount compared to its average historical valuations.

In the past year, the stock has generated a return of 87.95%, outperforming the BSE 500 index. However, its long-term growth has been poor with net sales and operating profit growing at an annual rate of 11.29% and 9.41%, respectively, over the last 5 years.

The majority shareholders of Competent Automobiles Company are its promoters, indicating their confidence in the company's performance. Overall, the stock has shown market-beating performance in both the long and near term, making it a hold for now.