Sofcom Systems (BOM:538923) GF Value Rank : 0 (As of Jun. 09, 2024)

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What is Sofcom Systems GF Value Rank?

Sofcom Systems has the GF Value Rank of 0.

The GF Value Rank is determined by the price-to-GF-Value (P/GF Value) ratio, a proprietary metric calculated based on historical multiples along with an adjustment factor based on a company's past returns and growth and future estimates of the business' performance.

GuruFocus found that for valuation, we cannot simply give stocks a better GF Value rank simply because they have a lower P/GF Value ratio. Backtesting shows that over the long term, the two worst-performing groups are the most expensive group (with the highest P/GF Value ratio) and the least expensive group (with the lowest P/GF Value ratio).

We can understand why the most expensive group underperforms. We were initially puzzled by the underperformance of the least expensive group, but we realized there is a reason why some stocks are super cheap. If they look too undervalued, it is often because the businesses behind them are poor quality. The market realized this and gave them low valuations. In a way, the market is efficient.

After multiple backtesting analyses, we granted the stocks in third-cheapest percentile the highest GF Value rank, as they have performed the best over a full market cycle. Stock performance is actually not as sensitive to valuation as it is to growth and profitability. On average, the companies in the 20%-50% valuation groups have similar performances. Therefore, we should avoid the most expensive and the least expensive stocks. We can be more tolerant of valuation.

Please click GF Score to see more details on the GF Score's 5 Key Aspects of Analysis.

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Sofcom Systems (BOM:538923) Business Description

Industry

GURUFOCUS.COM » STOCK LIST » Technology » Software » Sofcom Systems Ltd (BOM:538923) » Definitions » GF Value Rank

Comparable Companies

Traded in Other Exchanges

N/A

Address

D-36, Subhash Marg, Flat No. 802 Sheel Mohar Apartment, C-Scheme, Jaipur, RJ, IND, 302001

Website

http://www.sofcomsystems.com

Sofcom Systems Ltd provides consultancy for software development in the form of services, turnkey projects, and products for the domestic and export market. The software development is targeted towards the distribution, banking, telecommunication, and manufacturing sectors. It also offers software maintenance, reengineering, and downsizing of software applications in these market segments. The company is providing information technology solutions to both commercial and government clients. The Company is engaged in the trading of Software & other items and providing software consultancy in India. The Company derives revenues from sale of software and consultancy.

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