Scan Steels Downgraded to 'Hold' by MarketsMOJO, Long-Term Growth and Technical Trends Raise Concerns

Scan Steels, a microcap company in the iron and steel industry, has recently been downgraded to a 'Hold' by MarketsMOJO on August 7, 2024. This decision was based on the company's latest financial results, which showed a growth in net profit of 79.65% in June 2024. While this is a positive sign, the company's overall performance has been inconsistent.
Despite declaring positive results for the last two consecutive quarters, Scan Steels has a poor long-term growth rate. In fact, its operating profit has declined by an annual rate of 22.65% over the last five years. This raises concerns about the company's ability to sustain its current level of profitability.

On the bright side, Scan Steels has an attractive valuation with a 1 enterprise value to capital employed ratio and a return on capital employed of 6.9. However, the majority of the company's shareholders are non-institutional, which may indicate a lack of confidence from larger investors.

In terms of market performance, Scan Steels has outperformed the BSE 500 index with a return of 83.21% in the last year. However, its technical trend is currently mildly bearish, with a -2.26% return since August 7, 2024. Multiple factors, such as MACD, Bollinger Band, and KST, are also signaling a bearish outlook for the stock.

Overall, while Scan Steels has shown some positive results in the short term, its long-term growth and technical trends are cause for concern. Investors may want to hold off on buying or selling this stock until there is more stability and consistency in its performance.