Hathway Cable & Datacom Downgraded to 'Sell' by MarketsMOJO Due to Poor Management and Negative Outlook

Hathway Cable & Datacom, a smallcap company in the DTH/Cable industry, has recently been downgraded to a 'Sell' by MarketsMOJO on October 17, 2024. This decision was based on several factors that indicate a negative outlook for the company.
One of the main reasons for the downgrade is the poor management efficiency of Hathway Cable & Datacom. The company has a low Return on Equity (ROE) of 3.38%, which indicates low profitability per unit of shareholders' funds. This has been a consistent trend over the last 5 years, with the company's net sales and operating profit growing at a slow annual rate of 3.76% and 6.64%, respectively.

From a technical standpoint, the stock is currently in a Mildly Bearish range. The technical trend has deteriorated from Mildly Bullish on September 18, 2024, and has since generated a negative return of -5.52%. The MACD and KST technical factors also suggest a bearish outlook for the stock.

Another concerning factor is the negative operating profits of Hathway Cable & Datacom. While the stock has generated a return of 0.20% in the past year, its profits have actually increased by 58.4%. This has resulted in a PEG ratio of 0.6, indicating that the stock is trading at a risky valuation.

Institutional investors have also decreased their stake in the company by -1.83% over the previous quarter, holding only 3.13% of the company. This is a cause for concern as institutional investors have better resources to analyze company fundamentals compared to retail investors.

Furthermore, Hathway Cable & Datacom has underperformed the market in the last year, generating a return of only 0.20% compared to the market's (BSE 500) return of 33.11%.

On a positive note, the company has a low Debt to Equity ratio and has declared positive results for the last 3 consecutive quarters. It also has a high Inventory Turnover Ratio and Net Sales and PBDIT at their highest levels in the last quarter.

In conclusion, the downgrade of Hathway Cable & Datacom to 'Sell' by MarketsMOJO is based on various factors such as poor management efficiency, negative operating profits, and underperformance in the market. Investors should carefully consider these factors before making any investment decisions.