MarketsMOJO Upgrades Howard Hotels to 'Hold' Amid Bullish Trend and Attractive Valuation

Howard Hotels, a microcap company in the hotel industry, has recently received a 'Hold' rating from MarketsMOJO on July 31, 2024. This upgrade comes as the stock is currently in a bullish range and has shown a 4.71% return since June 25, 2024. The technical trend for the stock has deteriorated from bullish, but there are still multiple bullish factors such as MACD, Bollinger Band, and KST.
One of the reasons for the 'Hold' rating is the company's attractive valuation with a ROCE of 9 and a 2 Enterprise value to Capital Employed. Additionally, the stock is currently trading at a discount compared to its average historical valuations. Despite generating a return of 30.67% in the past year, the company's profits have only risen by 21%, resulting in a PEG ratio of 0.9.

The majority shareholders of Howard Hotels are the promoters, which can be seen as a positive sign for the company. However, the company does have some weaknesses in its long-term fundamental strength. It has been operating at a loss and has shown poor long-term growth with only a 4.30% annual growth rate in net sales over the last 5 years. Furthermore, the company's ability to service its debt is weak with a poor EBIT to Interest (avg) ratio of -0.27.

In the latest quarter, the company's results were flat with PBDIT(Q) at its lowest at Rs -0.50 cr, PBT LESS OI(Q) at its lowest at Rs -0.79 cr, and EPS(Q) at its lowest at Rs -0.85. Overall, while Howard Hotels may have some positive aspects, it is currently facing challenges and uncertainties that have led to the 'Hold' rating from MarketsMOJO. Investors should carefully consider these factors before making any decisions regarding this microcap company.