Empire Industries Downgraded to 'Hold' by MarketsMOJO Due to High Debt and Poor Long-Term Growth

Empire Industries, a microcap company in the glass industry, has recently been downgraded to a 'Hold' by MarketsMOJO on August 13, 2024. This decision was based on the company's recent financial results, which showed positive growth after two consecutive negative quarters.
One of the key factors contributing to this downgrade is the company's high debt-to-equity ratio of 3.20 times, indicating a low ability to service debt. However, on a positive note, the company's operating profit to interest ratio is at a healthy 3.36 times, and its PAT has grown by 58.3% in the last quarter.

Technically, the stock is currently in a mildly bullish range, with both its MACD and KST technical factors showing a bullish trend. Additionally, with a ROCE of 12.3 and a low debt-to-equity ratio of 0.56 times, the company has a very attractive valuation with a 1.8 enterprise value to capital employed.

Despite its recent positive financial results, the company has shown poor long-term growth, with net sales growing at an annual rate of only 2.25% and operating profit at 4.61% over the last 5 years. This may have contributed to the stock's underperformance in the market, with a return of 23.49% in the last year, significantly lower than the market's returns of 34.08%.

In conclusion, while Empire Industries may have shown some positive growth in the last quarter, its high debt and poor long-term growth may have led to its downgrade to a 'Hold' by MarketsMOJO. Investors should carefully consider these factors before making any decisions regarding this microcap company in the glass industry.