Navin Fluorine International Limited downgraded to 'Sell' due to negative financial results

Navin Fluorine International Limited, a midcap chemical company, has recently been downgraded to 'Sell' by MarketsMOJO. This decision was based on the company's negative financial results for the past 5 quarters, with a decrease of 21% in PBT LESS OI(Q) at Rs 58.04 crore. The company's ROCE(HY) has also hit a low of 9.54%, while its DEBT-EQUITY RATIO(HY) has reached a high of 0.57 times.
Technically, the stock is currently in a Mildly Bearish range, with a deteriorating trend since October 7th, 2024, resulting in a -3.12% return. Multiple factors, such as MACD, Bollinger Band, and KST, also suggest a bearish outlook for the stock.

Moreover, with a ROCE of 9.3, the stock is considered to have a very expensive valuation, with a 5.3 Enterprise value to Capital Employed. However, it is currently trading at a discount compared to its average historical valuations. Despite this, the stock has generated a negative return of -10.81% in the past year, while its profits have fallen by -39.7%.

In the long term, the stock has also underperformed BSE 500, with a return of -10.81% in the last 3 years, 1 year, and 3 months. However, the company has shown high management efficiency with a ROCE of 20.59% and a low Debt to Equity ratio (avg) of 0.07 times. Additionally, it has a healthy long-term growth rate, with Net Sales growing at an annual rate of 16.17% and Operating profit at 26.47%.

Furthermore, Navin Fluorine International Limited has a high institutional holding of 45.43%, indicating that these investors have better capabilities and resources to analyze the company's fundamentals compared to retail investors. In fact, their stake has increased by 1.25% in the previous quarter. Overall, while the company has shown below-par performance in the long term and near term, it does have some positive factors that investors should consider before making any decisions.