MarketsMOJO Downgrades Parshva Enterprises Due to Weak Fundamentals and Growth

Parshva Enterprises, a microcap trading company, has recently received a 'Sell' rating from MarketsMOJO. This downgrade is based on the company's weak long-term fundamental strength, poor growth, and weak ability to service its debt.
According to MarketsMOJO, Parshva Enterprises has an average Return on Equity (ROE) of 2.07%, indicating weak long-term fundamental strength. The company's operating profit has only grown by an annual rate of 0.99% over the last 5 years, showing poor long-term growth. Additionally, the company's EBIT to Interest (avg) ratio is only 0.23, indicating a weak ability to service its debt.

Moreover, with a ROCE of 3.7, Parshva Enterprises is considered to have a very expensive valuation with a 16.7 Enterprise value to Capital Employed. However, the stock is currently trading at a discount compared to its average historical valuations.

In the past year, Parshva Enterprises has underperformed the market, generating a return of only 11.36% compared to the market's (BSE 500) return of 37.91%. This decline in profits is also reflected in the company's recent financial results, with a 0% growth in profits.

On a positive note, the company has shown growth in its recent results, with a 36.74% increase in net sales and the highest PBDIT (Q) and PBT LESS OI (Q) at Rs 0.14 cr and Rs 0.11 cr respectively.

Technically, the stock is currently in a mildly bullish range, with both the MACD and KST technical factors showing a bullish trend.

It is worth noting that the majority shareholders of Parshva Enterprises are the promoters themselves. This may raise concerns about potential conflicts of interest and lack of external investment.

In conclusion, based on the recent downgrade by MarketsMOJO and the company's weak long-term fundamental strength, poor growth, and weak ability to service its debt, it may be wise for investors to consider selling their stocks in Parshva Enterprises.