The stock's fall to Rs.14.2 represents a sharp contrast to its 52-week high of Rs.51.83, reflecting a substantial depreciation of over 72% within the last year. Over the same period, Yarn Syndicate's share price has recorded a negative return of 71.06%, while the Sensex has posted a positive return of 9.48%, highlighting the stock's relative underperformance against the benchmark index.
On the trading day when the new low was recorded, Yarn Syndicate's price movement outperformed its sector by 3.07%, despite a day change of -3.12%. Notably, the stock has shown a slight recovery after two consecutive days of decline, although it remains below its 5-day, 20-day, 50-day, 100-day, and 200-day moving averages, indicating a persistent bearish trend in the short to long term.
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From a fundamental perspective, Yarn Syndicate's financial metrics reveal areas of concern. The company has reported operating losses, which contribute to a weak long-term fundamental strength. Additionally, the firm's ability to service its debt is limited, as indicated by a Debt to EBITDA ratio of -1.00 times. This negative EBITDA figure suggests that the company is currently generating insufficient earnings before interest, taxes, depreciation, and amortisation to cover its debt obligations.
Over the past year, despite the stock's negative price return, Yarn Syndicate's profits have risen by 129%. However, this improvement in profitability has not translated into positive stock performance. The stock's valuation remains risky compared to its historical averages, reflecting investor caution or market scepticism.
In terms of longer-term performance, Yarn Syndicate has underperformed the BSE500 index across multiple time frames, including the last three years, one year, and three months. This sustained underperformance underscores the challenges the company faces in regaining investor confidence and market momentum.
The majority of Yarn Syndicate's shares are held by non-institutional investors, which may influence the stock's liquidity and trading dynamics. Meanwhile, the broader market environment shows the Sensex trading in the red after a positive opening, currently down by 0.34% at 84,661.23 points. The Sensex remains close to its 52-week high of 85,290.06, trading above its 50-day and 200-day moving averages, signalling a generally bullish trend for the benchmark index.
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Yarn Syndicate's current trading position below all key moving averages suggests that the stock remains in a downtrend, with limited short-term momentum. The recent slight gain after two days of decline may indicate some consolidation, but the overall trend remains subdued. Investors analysing this stock should note the divergence between the company's improving profit figures and its declining market valuation.
In summary, Yarn Syndicate's fall to a 52-week low of Rs.14.2 reflects a combination of weak fundamental strength, negative EBITDA, and sustained underperformance relative to market benchmarks. While the broader market indices maintain a generally positive trajectory, Yarn Syndicate's stock continues to face challenges in reversing its downward trend.
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