MarketsMOJO Downgrades NCL Research and Financial Services to 'Sell' Due to Weak Fundamentals

NCL Research and Financial Services, a microcap finance company, has recently been downgraded to a 'Sell' by MarketsMOJO on May 28, 2024. This decision was based on the company's weak long-term fundamental strength, with an average Return on Equity (ROE) of 0.48% and poor long-term growth, with Net Sales growing at an annual rate of 9.57%.
Despite positive results in December 2023, with the company's PAT(Q) at its highest at Rs 1.05 crore and EPS(Q) at Rs 0.01, MarketsMOJO still believes that the stock is not a good investment option. However, the stock is currently in a Mildly Bullish range, with its Bollinger Band and KST technical factors also showing a Bullish trend.

At a ROE of 1.4, the stock has a fair valuation with a 0.6 Price to Book Value. Additionally, it is currently trading at a discount compared to its average historical valuations. Over the past year, the stock has generated a return of 82.50%, while its profits have risen by 89%. The PEG ratio of the company is also at a low 0.4.

It is worth noting that the majority of the company's shareholders are non-institutional investors. This could potentially lead to higher volatility in the stock's performance. Overall, with the recent downgrade by MarketsMOJO and the company's weak long-term fundamentals, it may be wise for investors to consider other options in the finance/NBFC industry.