Compucom Software Receives 'Sell' Rating After Poor Long-Term Growth and Declining Profits

Compucom Software, a microcap IT education company, has recently received a 'Sell' rating from MarketsMOJO. This downgrade comes after the company's poor long-term growth, with net sales only increasing by 0.66% annually over the last 5 years. In addition, the company reported negative results in March 2024, following two consecutive positive quarters.
The company's profits have also taken a hit, with a decline of -60.73% in PAT(HY) at Rs 1.19 crore and the lowest NET SALES(Q) and PBDIT(Q) at Rs 8.45 crore and Rs 0.98 crore respectively. With a ROE of 3.8, the stock is currently trading at a premium compared to its average historical valuations. This, combined with a high Price to Book Value of 1.7, makes the stock very expensive.

On a positive note, Compucom Software has a low Debt to Equity ratio and its stock is currently in a Mildly Bullish range. Technical indicators such as Bollinger Band, KST, and OBV also suggest a bullish trend for the stock. The majority shareholders of the company are the promoters, indicating their confidence in the company's future.

Despite the recent downgrade, Compucom Software has shown market-beating performance with a return of 55.67% in the last year, outperforming the BSE 500 index's return of 34.69%. However, investors should carefully consider the company's financials and valuation before making any investment decisions.