MarketsMOJO Upgrades Jet Freight Logistics to 'Hold' Rating After Positive Results and Fair Valuation

Jet Freight Logistics, a microcap logistics company, has recently received a 'Hold' rating from MarketsMOJO on June 29, 2024. This upgrade comes after the company reported positive results in March 2024, with a lowest debt-to-equity ratio of 0.92 times and a highest profit after tax of Rs 2.67 crore.
Technically, the stock is currently in a mildly bullish range, with both its DOW and OBV technical factors also showing a mildly bullish trend. With a ROCE of 3.6, the stock is considered to have an attractive valuation, with an enterprise value to capital employed ratio of 1. Additionally, the stock is currently trading at a fair value compared to its average historical valuations. However, despite generating a return of 19.46% in the past year, the company's profits have fallen by -5%.

On the other hand, Jet Freight Logistics has weak long-term fundamental strength, with a -12.54% CAGR growth in operating profits over the last 5 years. The company also has a high debt to EBITDA ratio of 5.31 times, indicating a low ability to service debt. Furthermore, the company has a low return on equity (average) of 5.61%, which signifies low profitability per unit of shareholders' funds.

It is also worth noting that 26.16% of the company's promoter shares are pledged, which could put additional downward pressure on the stock prices in falling markets. In the last 1 year, the stock has underperformed the market, generating a return of 19.46% compared to the market's (BSE 500) return of 37.90%.

Overall, while Jet Freight Logistics has shown some positive results and has a fair valuation, it also has some weaknesses in its long-term fundamentals and high promoter pledged shares. Therefore, MarketsMOJO has upgraded its rating to 'Hold' for this microcap logistics company.