Newgen Software Technologies Ltd (NEWGEN) Stock Recommendation | Score, Valuation, Technicals & Financial Trend

Score

Click here to find our call on this stock

Strong Sell

Sell

Hold

Buy

Strong Buy

Comparison

Company

Score

Quality

Valuation

Financial

Technical

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Latent View

Why is Newgen Software Technologies Ltd ?

High Management Efficiency with a high ROE of 19.67%

The company is Net-Debt Free

Poor long term growth as Operating profit has grown by an annual rate 16.03% of over the last 5 years

Flat results in Jun 26

ROCE(HY) Lowest at 24.01%
DEBTORS TURNOVER RATIO(HY) Lowest at 2.22 times
NON-OPERATING INCOME(Q) is 44.17 % of Profit Before Tax (PBT)

With ROE of 18.8, it has a Fair valuation with a 4.3 Price to Book Value

The stock is trading at a discount compared to its peers' average historical valuations
Over the past year, while the stock has generated a return of -38.97%, its profits have risen by 9.5% ; the PEG ratio of the company is 2.5

High Institutional Holdings at 21.94%

These investors have better capability and resources to analyse fundamentals of companies than most retail investors.

Underperformed the market in the last 1 year

Even though the market (BSE500) has generated returns of 4.11% in the last 1 year, the stock has hugely underperformed and has generate negative returns of -38.97% returns

Real-Time Research Report

Verdict Report

How much should you hold?

Overall Portfolio exposure to Newgen Software should be less than 10%
Overall Portfolio exposure to Computers - Software & Consulting should be less than 30%

(If sector exposure > 30%, please use optimiser tool to see which are the best stocks to hold in Computers - Software & Consulting)

When to exit? - We will constantly monitor the company and suggest at the appropriate time to exit from the stock

Is Newgen Software for you?

High Risk, Low Return

Absolute

Risk Adjusted

Volatility

Newgen Software

-38.97%

-0.73

53.09%

Sensex

-2.63%

-0.19

13.57%

Quality

Management Risk

Growth

Capital Structure

Quality grade scale :

Below Average, Average, Good, Excellent

Quality key factors

Factor

Value

Sales Growth (5y)

18.13%

EBIT Growth (5y)

16.03%

EBIT to Interest (avg)

58.37

Debt to EBITDA (avg)

0.15

Net Debt to Equity (avg)

-0.61

Sales to Capital Employed (avg)

0.96

Tax Ratio

22.60%

Dividend Payout Ratio

28.18%

Pledged Shares

Institutional Holding

21.94%

ROCE (avg)

45.27%

ROE (avg)

19.67%

Valuation

Valuation Scorecard

Valuation grade scale :

Very Risky, Risky, Very Expensive, Expensive, Fair, Attractive, Very Attractive

Valuation Key Factors

Factor

Value

P/E Ratio

Industry P/E

Price to Book Value

4.35

EV to EBIT

17.51

EV to EBITDA

15.97

EV to Capital Employed

9.47

EV to Sales

4.13

PEG Ratio

2.51

Dividend Yield

1.10%

ROCE (Latest)

52.58%

ROE (Latest)

18.82%

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Technicals

Technical key factors

Indicator

Weekly

Monthly

MACD

Mildly Bullish

Bearish

RSI

No Signal

Bollinger Bands

Mildly Bullish

Bearish

Moving Averages

Mildly Bearish (Daily)

KST

Bullish

Bearish

Dow Theory

No Trend

OBV

Bullish

Technical Indicator Scale: Bearish, Mildly Bearish, Sideways, Mildly Bullish, Bullish Turned

Technical Movement

Analyse All Technical Factors

Financial Trend

Financial Trend Scorecard

Financial Trend scale:

Very Negative, Negative, Flat, Positive, Very Positive, Outstanding

2What is working for the Company

PBT LESS OI(Q)

At Rs 45.85 cr has Grown at 32.06%

PAT(Q)

At Rs 62.82 cr has Grown at 26.3%

-6What is not working for the Company

ROCE(HY)

Lowest at 24.01%

DEBTORS TURNOVER RATIO(HY)

Lowest at 2.22 times

NON-OPERATING INCOME(Q)

is 44.17 % of Profit Before Tax (PBT

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Here's what is working for Newgen Software

Profit Before Tax less Other Income (PBT) - Quarterly

At Rs 45.85 cr has Grown at 32.06%

Year on Year (YoY)

MOJO Watch

Near term PBT trend is positive

PBT less Other Income (Rs Cr)

Profit After Tax (PAT) - Quarterly

At Rs 62.82 cr has Grown at 26.3%

Year on Year (YoY)

MOJO Watch

Near term PAT trend is positive

PAT (Rs Cr)

Here's what is not working for Newgen Software

Non Operating Income - Quarterly

is 44.17 % of Profit Before Tax (PBT)

MOJO Watch

The company's income from non business activities is high; which is not a sustainable business model

Non Operating Income to PBT

Debtors Turnover Ratio- Half Yearly

Lowest at 2.22 times

in the last five half yearly periods

MOJO Watch

Company's pace of settling its Debtors has slowed

Debtors Turnover Ratio

Non Operating Income - Quarterly

Highest at Rs 36.27 cr

in the last five quarters

MOJO Watch

Increased income from non business activities may not be sustainable

Non Operating Income