Soma Textiles & Industries Receives 'Sell' Rating from MarketsMOJO Due to Negative Outlook

Soma Textiles & Industries, a microcap textile company, has recently received a 'Sell' rating from MarketsMOJO on May 15, 2024. This downgrade is based on several factors that indicate a negative outlook for the company.
One of the main reasons for the 'Sell' rating is the company's high debt to EBITDA ratio of -1.00 times, which indicates a low ability to service its debt. Additionally, the company has reported losses and negative return on capital employed (ROCE), further highlighting its financial struggles.

Moreover, Soma Textiles & Industries has shown poor long-term growth with a decline in net sales and operating profit over the last 5 years. In fact, the company's results for December 2023 were flat, indicating a lack of improvement.

Another concerning factor is the negative EBITDA, which makes the stock a risky investment. Furthermore, the stock is currently trading at a higher risk level compared to its historical valuations. While the stock has generated a return of 63.58% in the past year, its profits have decreased by -103.7%.

On the positive side, the stock is technically in a Mildly Bullish range and has multiple bullish factors such as MACD, Bollinger Band, and KST. However, the majority shareholders of the company are promoters, which may raise concerns about the company's governance.

Despite consistent returns over the last 3 years, Soma Textiles & Industries' performance has been below the BSE 500 index. Overall, the 'Sell' rating from MarketsMOJO suggests caution for investors considering this microcap textile company.