MarketsMOJO downgrades Qgo Finance to 'Sell' due to weak fundamentals and potential decline in profitability.

Qgo Finance, a microcap finance company, has recently received a 'Sell' rating from MarketsMOJO. This downgrade is based on the company's weak long-term fundamental strength, with an average Return on Equity (ROE) of only 7.99%.
Despite declaring positive results for the last 10 consecutive quarters, with a net sales growth of 23.23% and a PBDIT (Q) of Rs 3.68 cr, Qgo Finance's PBT LESS OI (Q) is at its highest at Rs 1.17 cr. This indicates a potential decline in profitability in the future.

Technically, the stock is in a mildly bullish range, with the MACD being bullish since 05 Aug 2024. However, with an ROE of 18.6, the stock is currently trading at a premium compared to its average historical valuations.

Moreover, while the stock has generated a return of 47.39% in the past year, its profits have only risen by 76.6%. This results in a PEG ratio of 0.2, indicating that the stock may be overvalued.

The majority shareholders of Qgo Finance are its promoters, and the company has consistently generated returns over the last 3 years. However, it is important to note that while the stock has outperformed BSE 500 in each of the last 3 annual periods, its current financial standing raises concerns about its future potential.

In conclusion, MarketsMOJO's downgrade of Qgo Finance to 'Sell' is based on the company's weak long-term fundamentals and potential decline in profitability. Investors should carefully consider these factors before making any investment decisions.