MarketsMOJO Downgrades Ras Resorts & Apart Hotels to 'Sell' Due to Weak Fundamentals

Ras Resorts & Apart Hotels, a microcap company in the hotel, resort, and restaurant industry, has recently received a 'Sell' rating from MarketsMOJO on October 22, 2024.
The downgrade is based on the company's weak long-term fundamental strength, with an average Return on Capital Employed (ROCE) of 2.48%. Over the last 5 years, the company has shown poor long-term growth, with Net Sales growing at an annual rate of 6.83% and Operating profit at -3.19%. Additionally, the company's ability to service its debt is weak, with a poor EBIT to Interest (avg) ratio of 0.64.

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 3.8, the stock does have an attractive valuation with a 1 Enterprise value to Capital Employed. It is also currently trading at a discount compared to its average historical valuations.

Despite generating a return of 23.20% over the past year, the company's profits have only risen by 36%, resulting in a low PEG ratio of 0.1. It is worth noting that the majority shareholders of Ras Resorts & Apart Hotels are the promoters themselves.

Overall, while the stock may have some technical factors in its favor, the weak fundamental strength and poor long-term growth make it a 'Sell' according to MarketsMOJO. Investors should carefully consider these factors before making any decisions regarding this microcap company.