Federal Bank Receives 'Buy' Rating from MarketsMOJO for Strong Lending and Financial Performance.

Federal Bank, one of the leading private banks in India, has recently received a 'Buy' rating from MarketsMOJO. This upgrade comes as a result of the bank's strong lending practices and impressive financial performance.
One of the key factors contributing to the 'Buy' rating is the bank's low Gross NPA ratio of 2.36%, indicating a strong control over bad loans. Additionally, Federal Bank has shown a remarkable 29.84% CAGR growth in net profits, showcasing its long-term fundamental strength.

The bank has also consistently delivered positive results for the past 10 quarters, with its interest earned, net interest income, and profit after tax reaching all-time highs in the last quarter.

From a technical standpoint, the stock is currently in a mildly bullish range and has shown improvement in its trend since 22nd April 2024. The Bollinger Band, a key technical indicator, has also been bullish since the same date.

Moreover, with a return on assets (ROA) of 1.3, Federal Bank is currently trading at a very attractive valuation with a price to book value of 1.4. This is in line with its average historical valuations, making it a fair value stock.

In the past year, while the stock has generated a return of 17.33%, its profits have risen by 40.3%, resulting in a low PEG ratio of 0.5. Additionally, the bank has a high institutional holding of 73.96%, indicating that these investors have better capabilities and resources to analyze the company's fundamentals.

However, there are some risks associated with investing in Federal Bank. The stock has underperformed the market in the last year, with a return of 17.33% compared to the market's return of 38.02%. This could be a cause for concern for some investors.

Overall, with its strong financial performance, attractive valuation, and high institutional holding, Federal Bank is a promising stock to consider for investment.