Uma Exports Receives 'Hold' Rating After Positive Q2 Results and Bullish Technical Indicators

Uma Exports, a microcap trading company, has recently received a 'Hold' rating from MarketsMOJO. This upgrade comes after the company reported positive results in the quarter ending June 2024. The company's PBT LESS OI(Q) has grown by 184.0% to Rs 6.17 crore and its PAT(Q) has grown by 147.6% to Rs 6.48 crore.
Technically, the stock is in a bullish range and its trend has improved from mildly bullish to bullish on 24th September 2024. The MACD and KST technical factors also indicate a bullish trend. Additionally, institutional investors have increased their stake in the company by 0.96% in the previous quarter, collectively holding 0.97% of the company. This shows their confidence in the company's fundamentals.

Uma Exports has also outperformed the market (BSE 500) with a return of 175.97% in the last year, compared to the market's return of 40.54%. However, the company's long-term fundamental strength is weak with a -29.52% CAGR growth in operating profits over the last 5 years. It also has a high debt to EBITDA ratio of 3.93 times, indicating a low ability to service debt. The company's return on equity (avg) is 9.39%, which is relatively low, indicating low profitability per unit of shareholders' funds.

The stock is currently trading at a discount compared to its average historical valuations and has a ROCE of 6.1, which is considered expensive. While the stock has generated a high return in the past year, its profits have declined by -33.5%. This may be a cause for concern for investors.

Overall, MarketsMOJO's 'Hold' rating on Uma Exports suggests a neutral stance on the stock. Investors should carefully consider the company's weak long-term fundamentals and high debt before making any investment decisions.