Forbes & Company Downgraded to 'Sell' by MarketsMOJO Due to High Debt and Poor Growth

Forbes & Company, a microcap industrial equipment company, has recently been downgraded to a 'Sell' by MarketsMOJO on May 31, 2024. This decision was based on several factors, including the company's high debt-to-equity ratio of 3.00 times, indicating a heavy reliance on debt for financing. Additionally, Forbes & Company has shown poor long-term growth with net sales declining by an annual rate of -39.68% and operating profit at -23.16% over the last 5 years.
The company's financial performance in March 2024 also showed negative results, with a -51.82% growth in net sales, a -26.2% decline in PBT less OI, and a -12.3% decrease in PAT. With a ROE of 19.7, Forbes & Company is currently trading at an expensive valuation with a price-to-book value of 5.9. However, the stock is currently trading at a discount compared to its average historical valuations.

In the past year, Forbes & Company's stock has generated a return of 176.41%, but its profits have fallen by -84.3%. This could be a cause for concern for investors. Additionally, 98.25% of the company's promoter shares are pledged, which could put additional downward pressure on the stock prices in falling markets.

On a positive note, the stock is currently in a bullish range and its technical trend has improved from mildly bullish on May 31, 2024. The MACD and KST technical factors are also showing a bullish trend. Forbes & Company has also consistently outperformed the BSE 500 index in the last 3 years, generating strong returns for investors.

In conclusion, while Forbes & Company may have some positive technical indicators, its high debt and poor long-term growth make it a risky investment. Investors should carefully consider these factors before making any decisions regarding this microcap industrial equipment company.