MarketsMOJO Downgrades Beryl Drugs to 'Sell' Due to Weak Fundamentals and High Debt

Beryl Drugs, a microcap pharmaceutical company, has recently been downgraded to a 'Sell' by MarketsMOJO on October 21, 2024. This decision was based on several factors, including weak long-term fundamental strength with an average Return on Capital Employed (ROCE) of 5.27%, poor long-term growth with net sales growing at an annual rate of 14.04% and operating profit at 6.34% over the last 5 years, and a high debt to EBITDA ratio of 3.04 times, indicating a low ability to service debt.
In addition, the company's recent results for June 2024 showed a decline in net sales by -23.60%. However, there are some bullish factors for the stock, such as being in a mildly bullish range and having a ROCE of 13.8, making it very attractive in terms of valuation with a 1.7 enterprise value to capital employed. The stock is also currently trading at a discount compared to its average historical valuations.

Despite generating a return of 51.57% in the past year, Beryl Drugs' profits have fallen by -43.9%. The majority of shareholders are non-institutional investors. However, the stock has shown market-beating performance in the long term, outperforming BSE 500 in the last 3 years, 1 year, and 3 months. While the stock may have potential for future growth, current data suggests that it may not be a wise investment choice at this time.