Likhitha Infrastructure: Downgraded to 'Sell' by MarketsMOJO

Likhitha Infrastructure, a smallcap company in the capital goods industry, has recently been downgraded to a 'Sell' by MarketsMOJO on December 26, 2023. This decision was based on several factors, including flat results in September 2023, with the company's ROCE (HY) at its lowest at 30.26% and its inventory turnover ratio (HY) also at its lowest at 4.68 times.
However, there are other factors to consider as well. Likhitha Infrastructure has a low debt to equity ratio (avg) of 0 times, indicating a healthy financial position. The company has also shown a strong long-term growth with an annual growth rate of 38.08% in net sales and 48.61% in operating profit.

From a technical standpoint, the stock's trend is currently sideways, indicating no clear price momentum. However, it has improved from a mildly bearish trend on December 26, 2023 and has generated a return of -0.51% since then.

In terms of valuation, Likhitha Infrastructure has a fair valuation with a price to book value of 4 and a PEG ratio of 1. This suggests that the stock is trading at a discount compared to its historical valuations. Additionally, over the past year, the stock has generated a return of 34.71%, while its profits have risen by 18.3%.

It is also worth noting that institutional investors have increased their stake in the company by 0.57% in the previous quarter and collectively hold 0.67% of the company. This indicates their confidence in the company's fundamentals and their ability to analyze them.

Furthermore, Likhitha Infrastructure has consistently outperformed the BSE 500 index in the last 3 annual periods, with a return of 34.71% in the last year alone.

In conclusion, while MarketsMOJO has downgraded the stock to 'Sell', there are still positive factors to consider for Likhitha Infrastructure. Investors should carefully analyze the company's financials and performance before making any investment decisions.