OTCO International Downgraded to 'Sell' by MarketsMOJO, Weak Fundamental Strength a Concern

OTCO International, a microcap IT software company, has recently been downgraded to a 'Sell' by MarketsMOJO on September 17, 2024. This downgrade is based on the company's weak long-term fundamental strength, with a -152.65% CAGR growth in operating profits over the last 5 years. Additionally, the company's ability to service its debt is also a concern, with a poor EBIT to Interest (avg) ratio of 0.45.
In terms of recent performance, OTCO International reported flat results in June 2024. However, there are some mildly bullish technical indicators for the stock, such as MACD, Bollinger Band, and KST.

Despite these factors, the stock is currently trading at a discount compared to its average historical valuations, with a ROCE of 0.9 and a very attractive valuation of 1.8 Enterprise value to Capital Employed.

It is worth noting that while the stock has generated a return of 36.91% over the past year, its profits have actually fallen by -11%. This could be a cause for concern for potential investors.

The majority shareholders of OTCO International are the promoters, which may also be a factor to consider when evaluating the company's performance. Overall, with the recent downgrade and weak fundamental strength, it may be wise for investors to approach OTCO International with caution.