GFL Ltd is Rated Strong Sell

Rating Context and Current Position

On 15 December 2025, MarketsMOJO revised GFL Ltd’s rating from 'Sell' to 'Strong Sell', reflecting a significant deterioration in the company’s overall assessment. The Mojo Score dropped by 11 points, from 33 to 22, signalling heightened concerns about the stock’s prospects. This rating is a clear indication that the stock is currently viewed as a high-risk investment with limited upside potential.

It is important to note that while the rating change occurred in mid-December 2025, all financial data, returns, and fundamental indicators referenced here are as of 29 January 2026. This ensures investors receive the most up-to-date information to inform their decisions.

Quality Assessment: Below Average Fundamentals

As of 29 January 2026, GFL Ltd’s quality grade remains below average, reflecting weak long-term fundamental strength. The company’s average Return on Equity (ROE) stands at a negligible 0%, indicating minimal profitability relative to shareholder equity. Over the past five years, net sales have declined sharply at an annualised rate of -70.29%, underscoring persistent challenges in revenue generation and growth.

Additionally, GFL Ltd carries a high debt burden, with an average Debt to Equity ratio of 2.94 times. This elevated leverage increases financial risk, particularly in volatile market conditions, and may constrain the company’s ability to invest in growth or weather economic downturns.

Valuation: Very Expensive Despite Weak Returns

Despite the weak fundamentals, the stock is currently trading at a very expensive valuation. The Price to Book Value ratio is approximately 0.2, which, while appearing low numerically, is considered high relative to the company’s earnings and asset quality. This premium valuation is not supported by the company’s financial performance, making the stock unattractive from a value investing perspective.

Interestingly, while the stock has delivered a negative return of -32.81% over the past year, the company’s profits have risen by 91.1% during the same period. This disconnect suggests that market sentiment remains cautious, possibly due to concerns over sustainability of profit growth or other underlying risks.

Financial Trend: Positive but Insufficient

GFL Ltd’s financial grade is currently positive, reflecting some improvement in profitability metrics. However, this positive trend is insufficient to offset the broader weaknesses in quality and valuation. The company’s financial improvements have not translated into share price gains, as evidenced by the stock’s underperformance across multiple time frames.

As of 29 January 2026, the stock has declined by 2.43% in a single day, 15.98% over the past month, and 32.81% over the last year. These returns lag behind benchmark indices such as the BSE500, highlighting the stock’s relative weakness in both short and long-term horizons.

Technicals: Bearish Momentum Persists

The technical grade for GFL Ltd remains bearish, signalling downward momentum in the stock price. This is consistent with the recent price action, which shows sustained declines and lack of recovery. The bearish technical outlook suggests that investors should exercise caution, as the stock may continue to face selling pressure in the near term.

Institutional participation has also waned, with institutional investors reducing their stake by 0.99% in the previous quarter to hold a mere 0.63% of the company. Given that institutional investors typically possess greater analytical resources, their reduced involvement may reflect concerns about the company’s prospects.

Implications for Investors

The 'Strong Sell' rating from MarketsMOJO indicates that GFL Ltd is currently considered a high-risk stock with limited appeal for investors seeking capital appreciation or income stability. The combination of below-average quality, expensive valuation, bearish technicals, and only modest financial improvement suggests that the stock is unlikely to outperform in the near future.

Investors should carefully weigh these factors against their risk tolerance and portfolio objectives. Those with a low appetite for volatility or capital loss may prefer to avoid or reduce exposure to GFL Ltd until there are clearer signs of fundamental turnaround or valuation support.

Summary of Key Metrics as of 29 January 2026

GFL Ltd’s current market capitalisation remains in the microcap segment, reflecting its relatively small size and limited liquidity. The Mojo Score of 22.0 firmly places the stock in the 'Strong Sell' category, underscoring the overall negative outlook.

Performance metrics reveal consistent underperformance: the stock has declined by 1.60% over the past week, 26.88% over three months, and 21.27% over six months. Year-to-date losses stand at 16.71%, reinforcing the bearish sentiment.

From a fundamental perspective, the company’s weak long-term growth, high leverage, and poor return on equity remain key concerns. Although profits have shown a notable increase recently, this has not been sufficient to reverse the negative trend in share price or investor confidence.

Technical indicators and institutional investor behaviour further support the cautious stance. The bearish technical grade and declining institutional ownership suggest limited near-term catalysts for a positive turnaround.

Conclusion

In conclusion, GFL Ltd’s current 'Strong Sell' rating by MarketsMOJO reflects a comprehensive assessment of its weak fundamentals, expensive valuation, modest financial improvements, and negative technical outlook. Investors should approach this stock with caution, recognising the elevated risks and subdued prospects at present.

Monitoring future updates on the company’s operational performance, debt management, and market sentiment will be crucial for any reconsideration of its investment potential.

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