Mazda downgraded to 'Sell' by MarketsMOJO due to poor long-term growth and lack of domestic mutual fund interest

Mazda, a microcap engineering company, has recently been downgraded to a 'Sell' by MarketsMOJO on June 18, 2024. This decision was based on the company's poor long-term growth, with net sales growing at an annual rate of 10.23% and operating profit at 17.58% over the last 5 years. Additionally, the company has recently declared negative results after 4 consecutive positive quarters, with a decrease in PBT LESS OI(Q) at Rs 10.92 cr, NET SALES(Q) at Rs 57.55 cr, and PAT(Q) at Rs 9.37 cr.
One of the factors contributing to this downgrade is the fact that despite its size, domestic mutual funds hold only 0% of the company. This could indicate that they are not comfortable with the company's current price or business.

On a positive note, Mazda has a low debt to equity ratio and its stock is currently in a mildly bullish range. Technical indicators such as MACD, Bollinger Band, KST, and OBV also suggest a bullish trend for the stock.

With a ROE of 16.3 and a fair valuation of 3 price to book value, the stock is currently trading at a fair value compared to its historical valuations. However, its PEG ratio of 1 indicates that its profits have not kept up with its stock price growth.

Despite its recent downgrade, Mazda has shown market-beating performance in the long term, generating 67.36% returns in the last year and outperforming BSE 500 in the last 3 years, 1 year, and 3 months. Investors should carefully consider all factors before making any decisions regarding this microcap engineering company.