Lancor Holdings Receives 'Sell' Rating, But Potential Undervaluation Makes It An Attractive Investment Opportunity

Lancor Holdings, a microcap real estate company, has recently received a 'Sell' rating from MarketsMOJO. This downgrade is based on the company's weak long-term fundamental strength, with a -4.44% CAGR growth in operating profits over the last 5 years. Additionally, Lancor Holdings has a high debt to EBITDA ratio of 13.55 times, indicating a low ability to service debt. The company has also shown a low profitability per unit of shareholders' funds, with a return on equity of only 0.34%.
Despite declaring positive results for the last 7 consecutive quarters, Lancor Holdings' stock has been downgraded due to its weak financial performance. However, there are some positive factors to consider, such as a higher PAT (HY) of Rs 3.17 crore and a lowest debt-equity ratio (HY) of 0.69 times. The stock is also technically in a mildly bullish range, with its MACD and KST technical factors being bullish.

With a ROCE of 7.8, Lancor Holdings is fairly valued with a 2 enterprise value to capital employed. The stock is currently trading at a discount compared to its average historical valuations. In the past year, the stock has generated a return of 150.50%, while its profits have risen by 214.3%. This gives the company a PEG ratio of 0.6, indicating a potential undervaluation.

The majority shareholders of Lancor Holdings are its promoters, who have consistently generated returns over the last 3 years. In fact, the stock has outperformed BSE 500 in each of the last 3 annual periods. While the company's current financial performance may not be strong, its consistent returns and potential undervaluation may make it an attractive investment opportunity for long-term investors.