Medplus Health Services: A Promising Midcap Retailer Upgraded to 'Buy' by MarketsMOJO

Medplus Health Services, a midcap retailing company, has recently caught the attention of investors as its stock has been upgraded to 'Buy' by MarketsMOJO on November 19, 2024.
The company has shown healthy long-term growth with an annual increase of 19.81% in net sales and 21.44% in operating profit. In fact, in the latest quarter, Medplus Health Services declared very positive results with a 169.87% growth in net profit. Its ROCE (HY) is the highest at 8.14%, while its inventory turnover ratio (HY) and operating profit to interest (Q) are also at their highest levels at 4.47 times and 4.95 times, respectively.

Technically, the stock is in a mildly bullish range and has shown improvement from sideways trend on November 19, 2024. Multiple factors such as MACD, Bollinger Band, and OBV indicate a bullish trend for the stock.

Moreover, Medplus Health Services has a very attractive valuation with a ROCE of 7.4 and an enterprise value to capital employed ratio of 4. The stock is currently trading at a discount compared to its average historical valuations. Despite generating a return of -9.97% in the past year, the company's profits have increased by 71.8%, resulting in a PEG ratio of 1.2.

However, there are some risks associated with investing in Medplus Health Services. The company has shown poor management efficiency with a low ROCE of 5.42%. This signifies low profitability per unit of total capital (equity and debt). Additionally, its ability to service its debt is weak with a poor EBIT to interest (avg) ratio of 1.29. The company has also underperformed the market in the last year, generating negative returns of -9.97% while the market (BSE 500) has generated returns of 24.46%.

Furthermore, 54.17% of the promoter shares are pledged, which can put additional downward pressure on the stock prices in falling markets. Despite these risks, Medplus Health Services has shown strong growth potential and has been upgraded to a 'Buy' by MarketsMOJO, making it a promising investment opportunity in the midcap retailing industry.