Saudi Arabian stock report - Riyad Bank
Riyad Bank in 2nd consecutive rise, nears one-month high August 17, 2017 15:30 AST
NEWS BITES - MIDDLE EAST & NORTH AFRICA
Riyad Bank (TASI:1010), Saudi Arabia's 5th largest Bank by market cap, extended its gains on Thursday, rising an additional 10.0 hallalah (0.9%) to trade at SAR10.88. The stock increased 0.2% on Wednesday. This brought its 2-day rise to 1.1%, compared with the All Share Index (TASI) which rose 76.1 points (1.1%) in the two days for a relative price increase of 0.04%. Cumulative volume in the 2 days was 0.8 times the average 2-day volume of 944,162 shares. The stock is now approaching its 31-day high of SAR10.90.
RIYAD BANK BULLISH SIGNALS
+ The P/E of 9.8 multiplied by the P/NTA of 0.9 is 8.4. Being less than the Benjamin Graham benchmark of 22.5 the stock appears undervalued.
+ The relative yield of the stock, defined by its yield of 6%, divided by average yield of dividend yielding stocks in the All Share Index (TASI) of 4.1% is 146.7%. This suggests the stock is undervalued in dividend yield terms.
+ Tobin's Q Ratio, defined as MCap divided by Total Assets, is 0.1. Compared with the rest of the market the stock is undervalued and ranks in the top 2% of stock by value of Q Ratio.
+ The company is cash rich with Cash to Market Capitalisation at 65.1%.
+ Revenue and Net Profit growth have shown signs of recovery in recent quarters. [Quarter ended, all figures in %]
|Qtr||Revenue Growth||Net Profit Growth|
+ Revenue growth rate has shown signs of recovery in recent years. [Year ended, all figures in %]
|Year||Revenue Growth||EPS Growth||EBITDA Growth|
1.2 Undervaluation [compared with sector average]:
+ Price to Book of 0.9 [1.1]. We estimate Riyad Bank stock is trading at a current year Price to Book of 0.8 and a forward year Price to Book of 0.8.
+ Dividend yield of 6% [4.8%].
+ The price increased 0.9% in the last week and 0.4% in the last month.
+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 10.75 minus the 26-day EMA of 10.7 is positive 0.05 suggesting a bullish signal. Both EMA prices are rising, another bullish signal.
+ The 4.8% discount to 12-month high of SAR11.42 against the 31.4% premium to 12-month low of SAR8.28 suggests the stock continues to push for new highs.
+ The present value of SAR1,000 (PV1000) invested one year ago in Riyad Bank is SAR1,111, comprising a capital gain of SAR45 and dividend reinvested of SAR65.
|All Share Index (TASI)||1,002||997||1,154|
1.4 High Performance Indicators:
|Description||Value||Rank In Market|
|EBITDA Margin %||49.7||In Top Quartile|
|P/E * P/NTA||8.43||In Top Quartile|
|Earnings Yield %||10.2||In Top Quartile|
RIYAD BANK BEARISH SIGNALS
+ Total Liabilities/EBITDA of 49.5 which compares unfavourably with the Joseph Piotroski benchmark of 5.
+ As per the Du Pont analysis, Return on Equity of 8.8% is lower than sector average of 10.5%. This is computed as net profit margin of 45.7% times asset turnover [sales/assets] of 0.04 times leverage factor [total assets/shareholders' equity] of 5.8.
2.2 Overvaluation [compared with sector average]:
+ Return on Equity 8.8% [10.5%].
+ Return on Assets 1.5% [1.7%].
+ At SAR10.88 the price has risen above the upper Bollinger band resistance of SAR10.88, indicating a downside risk for it to fall back within the band.
+ The stock is overbought according to the Williams % R indicator of -5.9, suggesting the price is close to its 14-day high of SAR10.90.
2.4 Low Performance Indicator:
|Description||Value||Rank In Market|
|Today's Turnover||SAR11 million (US$2.9 million)||In Bottom Quartile|
PRICE VOLUME DYNAMICS
+ Volume: there were 1,008,517 shares worth SAR11 million (US$2.9 million) traded today. In the past week, volume was 0.6 times average and the shares were up 0.9%. The rise has been propped up by average volume of 1.1 times the average daily volume of 944,162 shares.
+ The present value of SAR1,000 (PV1000) invested ten years ago in Riyad Bank is SAR1,048, including a capital loss of SAR299 and dividend reinvested of SAR347.
+ 10 years Multiplier in SAR = 1.048x
+ Compound Annual Growth Rate (CAGR) in SAR = 0.5%
Present Value of USD1,000 invested 10 years ago:
+ The present value of USD1,000 (PV1000) invested ten years ago in Riyad Bank is $US1,047, including a capital loss of $US300 and dividend reinvested of $US346.
+ 10 years ago USD 1 equalled SAR 3.7509
+ 10 years Multiplier in USD = 1.047x
+ Compound Annual Growth Rate (CAGR) in USD = 0.5%
Aug 17, 2017: USD 1 equals SAR 3.76
3.2 Moving Annual Return
|1010||Close (SAR)||Dividends (SAR)||Capital Gain / (Loss) %||% Yield||Annual Return %|
|1 Yr ago||10.41||0.7||(30.9)||4.6||(26.2)|
|2 Yrs ago||15.05||0.7||(23.2)||3.6||(19.6)|
|3 Yrs ago||19.61||1.18||55.8||9.4||65.1|
|4 Yrs ago||12.59||1.3||13||11.7||24.7|
+ Beta: the Beta of Riyad Bank stock is 0.7. A Beta lower than 1 suggests this is a low risk, low return stock with volatility less than that of the market.
3.4 Turnover Rate & Turnover Period:
+ The turnover rate in the 12 months to date was 7.7% (or a turnover period of 13 years 4 days). This average length of ownership of the stock at 5.5 times the average holding period of 2 years 4 months for stocks in the All Share Index (TASI) suggests a larger number of core investors, making a long-term investment safer.
4.1 Global Rank [out of 47,596 stocks] and Rank in the Middle East & Africa Region [out of 2,284 stocks]
|Description||Value||Global Rank||In MEA Region|
|Total Assets (US$)||57.9B||751||22|
|Net Profit (US$)||889.8M||1,084||34|
|Return on Equity %||8.8||14,546||880|
|Net Profit Margin %||45.7||2,243||190|
|Price to Book||0.9||8,999||650|
|PV$1000 (1Year) US$*||1,111||19,263||716|
|US$* Change (1Year) %||3.6||21,018||787|
* 1 year ago USD 1 = SAR 3.76
Aug 17, 2017: USD 1 equals SAR 3.76
4.2 Independent Ratings
Riyad Bank was ranked 171 in the Brand Finance list of the world's 500 Valuable Banking brands by brand value in 2015; an improvement over a year from rank 214 in 2014. Brand Finance valued the brand at US$902 million.
It is the 1696th largest by revenue in the Forbes Global 2000.
It is placed 76/165 in BSS News Bites' ranking of Saudi Arabian performers in the past year, a percentile ranking of 54.
RIYAD BANK FINANCIALS
5.1 Financials Summary
|Year ended||Dec 2016||Dec 2015||Dec 2014|
|Sales (USD B)||2.6||2.3||2.3|
5.2 Trailing 12 Months Dividends
|Trailing 12 Months To||Value (hallalah)|
|17 Aug 2017||65|
|17 Aug 2016||70|
|17 Aug 2015||70|
|17 Aug 2014||118|
|17 Aug 2013||130|
RIYAD BANK PROFILE
Riyad Bank is a Saudi Arabia-based joint stock company operating in the banking and finance sector in compliance with Islamic Sharia. Its main activities are offered through three segments: personal banking, corporate banking and treasury and investment. Personal banking offers services, like current accounts, savings accounts, time deposits, credit cards, loans and borrowings. Its corporate segment provides business banking solutions, such as direct debit solutions, cash management, transfer solutions, online corporate banking, short and long term financing services, transfers and payroll solutions.
6.2 Industry & Sector
|Classification Level||Name of Sector|
|Business Sector||Banking & Investment Services|
|Industry Group||Banking Services|
6.3 Top Management
The chief executive officer is Abdulmajeed Abdullah Almobarak.
6.4 Issued Capital
Based on 3,000,000,000 issued shares the market capitalisation is SAR32.6 billion (US$8.7 billion).
To view Recent Company Headlines, click here
August 15: Riyad Bank announces the launching its service to inquire about dividends not-received on the bank's website
In order to safeguard the rights and the interests of the shareholders of Riyad Bank, the Bank hereby announces to its shareholders that a list of the shareholders who have not received their dividends for previous years has been made available on the Bank's website.
July 20: Riyad Bank announces the interim financial results for the period ended on 30-06-2017 (Six Months)
June 23: Riyad Bank announces the distribution of dividends to the Shareholders for the first half of 2017
Riyad Bank announces that the Board of Directors has recommended on 25/09/1438H corresponding to 20/06/2017G, the distribution of cash dividends for the first half of 2017 as follows:
1. Total distribution amount : SAR 1,050 Million.
2. Distribution per share: SAR 0.35
3. Distribution ratio of the nominal value per share 3.5%
4. Number of shares eligible for dividends : 3,000,000,000 shares.
5. The eligibility of dividends shall be for the shareholders owning shares on the due of Sunday 08/10/1438H as per Umm ALQura corresponding to 02/07/2017 and those shareholders registered in the Banks share registry at the Depository Center ( SDC ) at the end of the second trading day following the due date.
June 21: Riyad Bank announces dividend
Riyad Bank today announced a cash dividend of 35.0 hallalah per share. The ex dividend date is Monday, July 03, 2017 and it is payable on Sunday, July 16.
April 16: Riyad Bank announces the interim financial results for the period ending on 31-03-2017
Physical Address: King Abdul Aziz Road
PO Box 22622
State/Province/Country: Saudi Arabia
Exchange: Saudi Stock Exchange (Tadawul)
SA:1010; SAU:1010; AB:1010; 1010.SE