PFC Stock Upgraded to 'Buy' by MarketsMOJO, Shows Strong Financial Performance and High Institutional Holdings

Power Finance Corporation (PFC) has recently caught the attention of investors as its stock call has been upgraded to 'Buy' by MarketsMOJO on April 9, 2024. This largecap company in the finance/NBFC industry has shown positive results for the last four consecutive quarters, with a growth of 22.64% in PAT(HY) and the highest NET SALES(Q) at Rs 23,571.83 cr. Additionally, its CASH AND CASH EQUIVALENTS(HY) have also reached a record high of Rs 11,424.27 cr.
Technically, the stock is in a Mildly Bullish range and has multiple bullish factors such as MACD, Bollinger Band, and KST. With an ROE of 19.2, the company has an attractive valuation with a 1.4 Price to Book Value. Moreover, the stock is currently trading at a discount compared to its average historical valuations. In the past year, the stock has generated a return of 219.86%, while its profits have risen by 30.5%. The PEG ratio of the company is also at a low of 0.2. Additionally, the company offers a high dividend yield of 3.6%.

One of the key factors that make PFC a promising investment is its high institutional holdings at 35.37%. These investors have better capability and resources to analyze the fundamentals of companies compared to most retail investors. Their stake in PFC has also increased by 0.63% over the previous quarter, indicating their confidence in the company's future prospects.

PFC has also outperformed the market (BSE 500) with a return of 219.86% in the last year, compared to the market's return of 39.93%. However, there are some risks associated with investing in PFC. The company has shown weak long-term fundamental strength with a CAGR growth of only 9.62% in Net Sales. This indicates poor long-term growth potential for the company.

In conclusion, PFC is a stock worth considering for investment, with its positive financial performance, attractive valuation, and high institutional holdings. However, investors should also be aware of the company's weak long-term growth potential.