MarketsMOJO Upgrades Austin Engineering Company to 'Hold' Rating Based on Technical Indicators and Fair Valuation

Austin Engineering Company, a microcap company in the bearings industry, has recently received a 'Hold' rating from MarketsMOJO. This upgrade is based on various technical indicators, such as MACD, Bollinger Band, and OBV, which all point towards a bullish trend for the stock. Additionally, the stock is currently trading at a fair value compared to its historical valuations and has generated a return of 40.34% in the past year.
One of the major factors contributing to the 'Hold' rating is the company's attractive valuation, with a price to book value of 1.3 and a return on equity (ROE) of 6.1. However, it is important to note that the company's profits have fallen by -7.5% in the past year, despite the positive stock performance.

The majority shareholders of Austin Engineering Company are non-institutional investors, indicating a lack of interest from larger investors. However, the company has consistently generated returns over the last 3 years and has outperformed the BSE 500 index.

On the other hand, the company's long-term fundamental strength is weak, with an average ROE of 2.90% and poor growth in net sales and operating profit over the last 5 years. Additionally, the company's ability to service its debt is also a concern, with a low EBIT to interest ratio of 0.39.

In the latest quarter, the company's net sales have fallen by -6.3%, indicating a flat performance. Overall, while the technical indicators suggest a bullish trend for Austin Engineering Company, the company's weak long-term fundamentals and recent decline in net sales may warrant a 'Hold' rating for now. Investors should carefully consider these factors before making any investment decisions.