MarketsMOJO Downgrades Howard Hotels Due to Weak Fundamentals and Growth

Howard Hotels, a microcap company in the hotel industry, has recently received a 'Sell' rating from MarketsMOJO on July 1, 2024. This downgrade is due to weak long-term fundamental strength, with an average Return on Capital Employed (ROCE) of 2.17%. Additionally, the company has shown poor long-term growth, with net sales only increasing by an annual rate of 4.30% over the last 5 years. Furthermore, Howard Hotels has a weak ability to service its debt, with a poor EBIT to Interest (avg) ratio of -0.27.
In terms of technical factors, the stock is currently in a Mildly Bullish range, with both the MACD and KST technical factors also being Bullish. However, with a ROCE of 10.3, the stock does have an attractive valuation with a 2 Enterprise value to Capital Employed. It is also currently trading at a discount compared to its average historical valuations. Despite this, the company's profits have only risen by 21% in the past year, resulting in a PEG ratio of 0.8.

The majority shareholders of Howard Hotels are the promoters, and the company has shown market-beating performance with a return of 136.04% in the last year, significantly higher than the market (BSE 500) returns of 37.64%. While the stock has shown strong growth in the past year, the recent downgrade by MarketsMOJO suggests caution for potential investors.