Saudi Arabian stock report - Saudi Basic Industries
Saudi Basic Industries increases against the trend January 21, 2018 15:30 AST
NEWS BITES - MIDDLE EAST & NORTH AFRICA
Saudi Basic Industries Corp. (TASI:2010), Saudi Arabia's largest Petrochemical industries company by market cap, has increased 20.0 hallalah (0.2%) from its last trading session of January 18 to close at SAR106.60. Compared with the All Share Index (TASI) which fell 25.7 points (0.3%) in the day, the relative price increase was 0.5%. The volume was 0.5 times the average daily trading volume of 3.7 million shares.
SAUDI BASIC INDUSTRIES ISSUED 2 NEW PATENTS IN THE WEEK OF JANUARY 16, 2018
Saudi Basic Industries (2010) has been issued 2 new patents by the USPTO and EPO.
Highlights in today's Report:
SECTION 1 BULLISH SIGNALS
Fundamentals, Undervaluation [compared with sector average], Technicals, High Performance Indicators, A positive finish to 2017
SECTION 2 BEARISH SIGNALS
Fundamentals, Overvaluation [compared with sector average], Technicals
SECTION 3 PRICE VOLUME DYNAMICS
Technicals, Moving Annual Return, Beta, Turnover Rate & Turnover Period
SECTION 4 RANKING
Global, Independent Rating
SECTION 5 FINANCIALS
Financials Summary, Trailing 12 Months Dividends
SECTION 6 PROFILE
Activities, Top Management, Issued Capital
SECTION 7 PATENTS
SECTION 8 STOCK BUZZ
Acquisition, Corporate Wire
SECTION 1 SAUDI BASIC INDUSTRIES BULLISH SIGNALS
+ The relative yield of the stock, defined by its yield of 3.8%, divided by average yield of dividend yielding stocks in the All Share Index (TASI) of 3.5% is 106.2%. This suggests the stock is undervalued in dividend yield terms.
+ Tobin's Q Ratio, defined as MCap divided by Total Assets, is 1. Compared with the rest of the market the stock is undervalued.
+ Net Profit margin is positive and has seen consecutive rises in recent quarters. [Quarter ended, all figures in %]
|Qtr||Revenue Growth||Net Profit Growth||Net Profit Margin|
1.2 Undervaluation [compared with sector average]:
+ Return on Assets 5.6% [3.3%].
+ Return on Capital Employed 7.6% [5.7%].
+ Dividend yield of 3.8% [3.4%].
+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 104.6 minus the 26-day EMA of 103.21 is positive 1.4 suggesting a bullish signal. Both EMA prices are rising, another bullish signal.
+ In the last three months the stock has hit a new 52-week high thrice.
+ The present value of SAR1,000 (PV1000) invested one year ago in Saudi Basic Industries is SAR1,221, comprising a capital gain of SAR172 and dividend reinvested of SAR49.
|All Share Index (TASI)||1,010||1,039||1,093|
+ The present value of SAR1,000 (PV1000) invested five years ago in Saudi Basic Industries is SAR1,513, including a capital gain of SAR161 and dividend reinvested of SAR353.
+ 5 years Multiplier in SAR = 1.513x
+ Compound Annual Growth Rate (CAGR) in SAR = 8.6%
Present Value of USD1,000 invested 5 years ago:
+ The present value of USD1,000 (PV1000) invested five years ago in Saudi Basic Industries is $US1,514, including a capital gain of $US161 and dividend reinvested of $US353.
+ 5 years ago USD 1 equalled SAR 3.7509
+ 5 years Multiplier in USD = 1.514x
+ Compound Annual Growth Rate (CAGR) in USD = 8.7%
Jan 21, 2018: USD 1 equals SAR 3.75
1.4 High Performance Indicators:
|Description||Value||Rank In Market|
|Today's Turnover||SAR206.7 million (US$55.1 million)||In Top 2%|
|Volatility %||0.8||In Top Quartile|
1.5 A positive finish to 2017
The stock has climbed SAR12.16 (or 13.6%) in FY 2017 bringing its two-year rise to 35.4%. The stock last traded at SAR101.80. The average daily volume of 3.6 million shares in FY 2017 was 0.5 times the average daily volume in FY 2016.
SECTION 2 SAUDI BASIC INDUSTRIES BEARISH SIGNALS
+ Total Liabilities/EBITDA of 5.1 which compares unfavourably with the Joseph Piotroski benchmark of 5.
+ Net profit margin has averaged 12.8% in the last 3 years. This is lower than the sector average of 13.8% and suggests a low margin of safety.
+ As per the Du Pont analysis, Return on Equity of 10.9% is lower than sector average of 22.7%. This is computed as net profit margin of 13.4% times asset turnover [sales/assets] of 0.43 times leverage factor [total assets/shareholders' equity] of 1.9.
2.2 Overvaluation [compared with sector average]:
+ Price/Sales of 3 [2.4].
+ Return on Equity 10.9% [22.7%].
+ The Relative Strength Index (RSI) of 77.6 has penetrated the overbought line of 70, suggesting the price gain of 5.5% in the last 14 days is unusually high.
SECTION 3 PRICE VOLUME DYNAMICS
+ Volume: there were 1,939,269 shares worth SAR206.7 million (US$55.1 million) traded today. In the past week, volume was 0.9 times average and the shares were up 1.9%.
+ The Saudi Basic Industries is at a discount of 1.5% to its 12-month high of SAR108.20 traded on January 16.
3.2 Moving Annual Return
Based on a dynamic start date of 5 years ago, the Moving Annual Return has been positive in 3 of the last 5 years. An investment a year ago in 2010 would have produced a return of 21.6%.
|2010||Close (SAR)||Dividends (SAR)||Capital Gain / (Loss) %||% Yield||Annual Return %|
|1 Yr ago||90.98||5||47.4||8.1||55.5|
|2 Yrs ago||61.73||5.5||(20.5)||7.1||(13.4)|
|3 Yrs ago||77.65||5.5||(32.7)||4.8||(27.9)|
|4 Yrs ago||115.37||5||25.6||5.4||31.0|
Close 5 years ago SAR91.85
+ Beta: the Beta of Saudi Basic Industries stock is 0.5. A Beta lower than 1 suggests this is a low risk, low return stock with volatility less than that of the market.
3.4 Turnover Rate & Turnover Period:
+ The turnover rate in the 12 months to date was 27.6% (or a turnover period of 3 years 7 months). This average length of ownership of the stock at 1.9 times the average holding period of 1 year 11 months for stocks in the All Share Index (TASI) suggests a larger number of core investors, making a long-term investment safer.
SECTION 4 RANKING
4.1 Global Rank [out of 47,401 stocks] and Rank in the Middle East & Africa Region [out of 2,278 stocks]
|Description||Value||Global Rank||In MEA Region|
|Total Assets (US$)||84.5B||573||14|
|Net Profit (US$)||4.8B||201||5|
|Return on Equity %||10.9||11,931||696|
|Net Profit Margin %||13.4||8,745||657|
|Price to Book||2.0||18,667||1,147|
|PV$1000 (1Year) US$*||1,223||18,035||612|
|US$* Change (1Year) %||16.7||19,040||640|
* 1 year ago USD 1 = SAR 3.76
Jan 21, 2018: USD 1 equals SAR 3.75
4.2 Independent Rating
+ FT 500:
Saudi Basic Industries Corp. is the 102nd largest by revenue in the FT Global 500.
+ Fortune 500:
It was ranked 299 by total revenues in the Fortune 500 annual list for 2017; a deterioration over a year from rank 247 in 2016.
+ Newsweek 500:
It was ranked 415 by Newsweek and Corporate Knights Capital in the World's 500 Greenest Companies 2016. It had outstanding scores of 10.4% in Water productivity, 2.1% in Energy productivity and 1.7% in Carbon productivity.
+ Industryweek 1000:
It is a new entrant in the Industry Week list of the world's largest 1000 manufacturers by Revenues in 2016, ranked 94.
+ Forbes 2000:
It is the 176th largest by revenue in the Forbes Global 2000.
+ BSS/News Bites:
It is placed 42/166 in BSS News Bites' ranking of Saudi Arabian performers in the past year, a percentile ranking of 75.
SECTION 5 SAUDI BASIC INDUSTRIES FINANCIALS
5.1 Financials Summary
|Year ended||Dec 2016||Dec 2015||Dec 2014|
|Sales (USD B)||36.2||40.2||50.8|
|Pretax (USD B)||5.6||5.6||6.8|
|Net (USD B)||4.8||5||6.2|
Sales was down 9.8% from US$40.2 billion in 2015 to US$36.2 billion in 2016. Net profit was down 5% from US$5 billion in 2015 to US$4.8 billion in 2016.
5.2 Trailing 12 Months Dividends
|Trailing 12 Months To||Value (SAR)|
|21 Jan 2018||4|
|21 Jan 2017||5|
|21 Jan 2016||5.5|
|21 Jan 2015||5.5|
|21 Jan 2014||5|
SECTION 6 SAUDI BASIC INDUSTRIES PROFILE
Saudi Basic Industries (SABIC) is a petrochemical company that operates in the non-oil industrial sector worldwide. SABIC operates six core business units. The Basic Chemicals unit products include methanol, ethylene, propylene, benzene, xylene, styrene, crude industrial ethanol, butadiene and butadiene-1. The Intermediates unit produces ethylene glycol, ethylene dichloride, and vinyl chloride monomer and dioctyl phthalate. The polyvinyl chloride (PVC) and Polyester unit provides polymeric materials and allied products. Its main products include polyester, melamine, polypropylene, PVC and polystyrenes. The Fertilizers unit offers ammonia and urea, phosphate and liquid fertilizers. The Metals unit is a supplier of flat steel, long steel and aluminum products. The Polyolefins business unit is a producer of polyethylene (PE), polypropylene (PP) and their by-products.
6.2 Top Management
The chairman is Abdulaziz Saleh Aljarbou and the chief executive officer is Yousef Abdullah Al-Benyan.
6.3 Issued Capital
Based on 3,000,000,000 issued shares the market capitalisation is SAR319.8 billion (US$85.3 billion).
SECTION 7 SAUDI BASIC INDUSTRIES PATENTS
Issued January 16, 2018
Bridged metallocene complex for olefin polymerization [9,868,797]
A metallocene complex according to formula 1 ##STR00001## wherein M is a metal selected from lanthanides or transition metals from group 3, 4, 5, or 6, Q is an anionic ligand to M, k is the number of Q groups and equals the valence of M minus 2, X is a cyclic bridging group that is bonded to a carbon atom of the cyclopentadienyl ligand and to nitrogen, Z.sub.1, and Z.sub.4 are hydrogen or a hydrocarbon radical with 1-20 carbon atoms; adjacent substituents Z.sub.2 and Z.sub.3 and are connected to form an indenyl or tetrahydroindenyl ring system and R is hydrogen or a hydrocarbon radical with 1-20 carbon atoms. Also described is a composition comprising the metallocene complex, a process for the preparation of the complex, and a process for the polymerization of olefin polymers in the presence of the metallocene complex.
Procatalyst for polymerization of olefins [9,868,799]
The invention relates to a procatalyst for polymerization of olefins. The invention also relates to a process for preparing said procatalyst. Furthermore, the invention is directed to a catalyst system for polymerization of olefins comprising the said procatalyst, a co-catalyst and optionally an external electron donor; a process of preparing polyolefins by contacting an olefin with said catalyst system and to polyolefins obtained or obtainable by said process. The invention also relates to the use of said procatalyst in the polymerization of olefins.
To view more details on these Patents, click here
SECTION 8 STOCK BUZZ
August 16 2017: Saudi Basic Industries Corp. announces the latest developments on the completion of its acquisition of Shell Chemical Arabia L.L.C.s shares in Saudi Petrochemical Company (Sadaf)
With reference to SABICs announcement on Tadawul dated Jan 22, 2017, regarding its proposed acquisition of Shell Chemicals Arabia L.L.C.s entire 50% stake in Saudi Petrochemical Company (Sadaf), with a value amounting to USD 820,000,000 including the foreign partners share of the net assets value, SABIC announces that the proposed acquisition was completed on August 16th, 2017. The financial impact of the transaction will be reflected in SABICs results during the 3rd quarter of 2017.
Sadaf produces ethylene, MTBE, styrene and other basic chemicals. The Sadaf complex includes six petrochemical plants, with a total production capacity of more than 4 million metric tons per year. This agreement with Shell Chemicals Arabia L.L.C. follows SABICs strategy to enhance returns of its investments to contribute more effectively in achieving its strategic objectives.
8.2 Corporate Wire
To view Recent Company Headlines, click here
January 02: SABIC launches NUSANED to support local content development
SABIC launched a groundbreaking initiative, NUSANED, which seeks to promote investments in small and medium enterprises and support the development of local content, here on Monday.
NUSANED is the first initiative launched by SABIC's Local Content and Business Development Unit (LCBDU) formed in early 2017.
October 29 2017: Saudi Basic Industries Corp. announces the interim financial results for the period ending on 30-09-2017 (Nine Months)
October 09 2017: Saudi Basic Industries Corporation (SABIC) announces the results of its second Extraordinary General Assembly of 2017 (First Meeting)
Saudi Basic Industries Corporation (SABIC) announces the results of its Extraordinary General Assembly held at SABIC HQ, Riyadh, on Sunday, October 8, at 8:30 pm, after the quorum was completed. The attendance recorded was 80.59 % of the capital. The results of the vote on the agenda of the Assembly was as follows:
July 30 2017: Saudi Basic Industries Corp. announces the interim financial results for the period ending on 30-06-2017 (Six Months)
Physical Address: PO Box 5101
State/Province/Country: Saudi Arabia
Exchange: Saudi Stock Exchange (Tadawul)
SA:2010; SAU:2010; AB:2010; 2010.SE