Saudi Arabian stock report - Riyad Bank
Riyad Bank increases, 2 days' volume in a day August 16, 2018 15:30 AST
NEWS BITES - MIDDLE EAST & NORTH AFRICA
Riyad Bank (TASI:1010), Saudi Arabia's 4th largest Bank by market cap, has increased 10.0 hallalah (0.6%) from its last trading session of August 15 to close at SAR16.70. Compared with the All Share Index (TASI) which rose 14.9 points (0.2%) in the day, the relative price increase was 0.4%. The rise has been propped up by robust volume of 1.7 times the average daily volume of 898,259 shares. Its MCap is SAR50.1 billion (US$13.4 billion).
Highlights in today's Report:
SECTION 1 BULLISH SIGNALS
SECTION 2 BEARISH SIGNALS
SECTION 3 PRICE VOLUME DYNAMICS
SECTION 4 RELATED NEWS
SECTION 5 GLOBAL RANKING
SECTION 6 SUMMARY FINANCIALS
SECTION 7 PROFILE
SECTION 1 RIYAD BANK BULLISH SIGNALS
+ In the last three months the stock has hit a new 52-week high twelve times, pointing to a significant uptrend.
+ The present value of SAR1,000 (PV1000) invested one year ago in Riyad Bank is SAR1,620, comprising a capital gain of SAR585 and dividend reinvested of SAR35.
|All Share Index (TASI)||962||937||1,104|
+ The present value of SAR1,000 (PV1000) invested ten years ago in Riyad Bank is SAR1,442, including a capital gain of SAR93 and dividend reinvested of SAR349.
+ 10 years Multiplier in SAR = 1.442x
+ Compound Annual Growth Rate (CAGR) in SAR = 3.7%
Present Value of USD1,000 invested 10 years ago:
+ The present value of USD1,000 (PV1000) invested ten years ago in Riyad Bank is $US1,441, including a capital gain of $US93 and dividend reinvested of $US349.
+ 10 years ago USD 1 equalled SAR 3.7481
+ 10 years Multiplier in USD = 1.441x
+ Compound Annual Growth Rate (CAGR) in USD = 3.7%
Aug 16, 2018: USD 1 equals SAR 3.75
1.2 Oversold/Bullish/Support Signals:
+ The Relative Strength Index (RSI) of 25.9 has breached the oversold line of 30, suggesting the price decrease of 6.7% in the last 14 days is unusually high.
+ The Stochastic indicator of 11.0 has pierced the oversold line of 20; this indicates the price is close to its 14-day low and is likely to revert to an uptrend.
High Performance Indicators and rank of Riyad Bank in the Saudi Arabian market:
|Description||Value||Rank In Market|
|Price/MAP200||1.19||In Top 5%|
|Price/MAP50||1.0||In Top Quartile|
|EBITDA Margin %||52||In Top Quartile|
+ Tobin's Q Ratio, defined as MCap divided by Total Assets, is 0.2. Compared with the rest of the market the stock is undervalued and ranks in the top 7% of stock by value of Q Ratio.
1.4 Undervaluation [compared with sector average]:
+ Price to Book of 1.3 [1.6]. We estimate Riyad Bank stock is trading at a current year Price to Book of 1.3 and a forward year Price to Book of 1.2.
SECTION 2 RIYAD BANK BEARISH SIGNALS
Low Performance Indicator and rank of Riyad Bank in the Saudi Arabian market:
|Description||Value||Rank In Market|
|Return on Assets [ROA] %||1.8||In Bottom Quartile|
+ The relative yield of Riyad Bank, defined by its yield of 2.2%, divided by average yield of dividend yielding stocks in the All Share Index (TASI) of 2.3% is 96.5%. This suggests Riyad Bank stock is overvalued in dividend yield terms.
+ Total Liabilities/EBITDA of 42 which compares unfavourably with the Joseph Piotroski benchmark of 5.
+ As per the Du Pont analysis, Return on Equity [ROE] of 10.2% is lower than sector average of 13.0%. ROE is computed as net profit margin of 48.6% times asset turnover [sales/assets] of 0.04 times leverage factor [total assets/shareholders' equity] of 5.6.
2.2 Overvaluation [compared with sector average]:
+ Return on Equity 10.2% [13.0%].
+ Dividend yield of 2.2% [2.8%].
SECTION 3 RIYAD BANK PRICE VOLUME DYNAMICS
+ Volume: there were 1,502,569 shares worth SAR25.1 million (US$6.7 million) traded today. In the past week, volume was 0.9 times average and the shares were down 6.2%.
+ Riyad Bank is at a discount of 8.2% to its 12-month high of SAR18.20 on July 22. It is also at a premium of 58.2% to the 12-month low of SAR10.56 on August 17, 2017.
3.2 Turnover Rate & Turnover Period:
+ The turnover rate in the 12 months to date was 6.2% (or a turnover period of 16 years 3 months). This average length of ownership of the stock at 8.5 times the average holding period of 1 year 11 months for stocks in the All Share Index (TASI) suggests a larger number of core investors, making a long-term investment safer.
3.3 Moving Annual Return (Past 5 years)
Based on a dynamic start date of 5 years ago, the Moving Annual Return has been positive in 3 of the last 5 years. An investment a year ago in Riyad Bank would have produced a return of 62.0%.
|TASI:1010||Close (SAR)||Dividends (SAR)||Capital Gain / (Loss) %||% Yield||Annual Return %|
|1 Yr ago||10.54||0.3||(1.1)||2.8||1.7|
|2 Yrs ago||10.66||0.7||(30.6)||4.6||(26.0)|
|3 Yrs ago||15.35||0.7||(22.5)||3.5||(18.9)|
|4 Yrs ago||19.8||1.18||55.8||9.3||65.1|
Close 5 years ago SAR12.71
+ Beta: the Beta of Riyad Bank stock is 1.3. A Beta greater than 1 suggests this is a high risk, high return stock with volatility greater than that of the market.
+ Riyad Bank (TASI:1010), surged SAR4.46 (or 36.4%) year-to-date (YTD) in 2018 to close at SAR16.70 today. Compared with the All Share Index (TASI) which has risen 8.9% YTD, this is a relative price increase of 27.6%.
SECTION 4 RIYAD BANK RELATED NEWS
+ BSS/News Bites:
Riyad Bank is placed 6/166 in BSS News Bites' ranking of Saudi Arabian performers in the past year, a percentile ranking of 96.
SECTION 5 RIYAD BANK GLOBAL RANKING
Global Rank [out of 47,646 stocks] and Rank of Riyad Bank in the Middle East & Africa Region [out of 2,279 stocks]
|Description||Value||Global Rank||In MEA Region|
|Total Assets (US$)||57.7B||792||24|
|Net Profit (US$)||1.1B||1,076||29|
|Return on Equity %||10.2||13,337||729|
|Net Profit Margin %||48.6||2,096||171|
|Price to Book||1.3||15,989||1,005|
|PV$1000 (1Year) US$*||1,623||3,290||143|
|US$* Change (1Year) %||58.1||3,363||149|
* 1 year ago USD 1 = SAR 3.76
Aug 16, 2018: USD 1 equals SAR 3.75
SECTION 6 RIYAD BANK SUMMARY FINANCIALS
6.1 Dividend History
+ Trailing 12 months dividend has deteriorated from SAR1.18 in 2014 to 37.0 hallalah in 2018.
6.2 Financials Summary (Past 3 years)
|Year ended||Dec 2017||Dec 2016||Dec 2015|
|Sales (USD B)||2.2||2.1||2.3|
+ Sales were up 5.5% from US$2.1 billion in 2016 to US$2.2 billion in 2017.
+ Net profit was up 18.1% from US$891.3 million in 2016 to US$1.1 billion in 2017.
SECTION 7 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.
7.2 Top Management
The chief executive officer is Abdulmajeed Abdullah Almobarak.
7.3 Issued Capital
Based on 3,000,000,000 issued shares the market capitalisation is SAR50.1 billion (US$13.4 billion).
Physical Address: King Abdul Aziz Road
PO Box 22622
State/Province/Country: Saudi Arabia
Exchange: Saudi Stock Exchange (Tadawul)
Business Sector: Banking & Investment Services
Industry Group: Banking Services
Economic Sector: Financials
SA:1010; SAU:1010; AB:1010; 1010.SE