Saudi Arabian stock report - Saudi Basic Industries
Saudi Basic Industries falls in 4 out of last 5 days August 16, 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 decreased 80.0 hallalah (0.6%) to close at SAR123.0. Compared with the All Share Index (TASI) which rose 14.9 points (0.2%) in the day, the relative price change was -0.8%. The volume was 0.7 times the average daily trading volume of 4.7 million shares. Saudi Basic Industries' stock fell in four out of the last 5 trading days, for a 5-day fall of 2.8%. Its MCap is SAR369 billion (US$98.4 billion).
Highlights in today's Report:
SECTION 1 BEARISH SIGNALS
SECTION 2 BULLISH SIGNALS
SECTION 3 PRICE VOLUME DYNAMICS
SECTION 4 RELATED NEWS
SECTION 5 GLOBAL RANKING
SECTION 6 SUMMARY FINANCIALS
SECTION 7 PROFILE
SECTION 1 SAUDI BASIC INDUSTRIES BEARISH SIGNALS
Downtrend: The stock dropped on high volatility today.
+ The price sank 4.7% in the last month.
+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 125.66 minus the 26-day EMA of 126.53 is negative 0.86 suggesting a bearish signal. Both EMA prices are falling, another bearish signal.
+ Falls to Rises: in the past month the number of falls outnumbered rises 14:6 or 2.3:1.
Low Performance Indicators and rank of Saudi Basic Industries in the Saudi Arabian market:
|Description||Value||Rank In Market|
|Price to Sales||7||In Bottom Quartile|
|Price Change %||-0.6||In Bottom Quartile|
+ Total Liabilities/EBITDA of 5.3 which compares unfavourably with the Joseph Piotroski benchmark of 5.
1.3 Overvaluation [compared with sector average]:
+ Price/Sales of 7 [3.7].
+ Price to Book of 2.2 [1.5].
SECTION 2 SAUDI BASIC INDUSTRIES BULLISH SIGNALS
+ 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 SAR1,258, for a capital gain of SAR258.
|All Share Index (TASI)||962||937||1,104|
+ The present value of SAR1,000 (PV1000) invested ten years ago in Saudi Basic Industries is SAR1,409, including a capital gain of SAR57 and dividend reinvested of SAR352.
+ 10 years Multiplier in SAR = 1.409x
+ Compound Annual Growth Rate (CAGR) in SAR = 3.5%
Present Value of USD1,000 invested 10 years ago:
+ The present value of USD1,000 (PV1000) invested ten years ago in Saudi Basic Industries is $US1,409, including a capital gain of $US57 and dividend reinvested of $US352.
+ 10 years ago USD 1 equalled SAR 3.7481
+ 10 years Multiplier in USD = 1.409x
+ Compound Annual Growth Rate (CAGR) in USD = 3.5%
Aug 16, 2018: USD 1 equals SAR 3.75
2.2 Oversold/Bullish/Support Signals:
+ The Relative Strength Index (RSI) of 5.3 has breached the oversold line of 30, suggesting the price decrease of 4.9% in the last 14 days is unusually high.
+ The stock is oversold according to the Williams % R indicator of -89.7, suggesting the price is close to its 14-day low of SAR122.20.
+ The Money Flow Index [MFI] is 3.6 suggesting an oversold 14-day trend, being under 20.
+ The Stochastic indicator of 7.6 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 Saudi Basic Industries in the Saudi Arabian market:
|Description||Value||Rank In Market|
|Today's Trading Turnover||SAR415.6 million (US$110.8 million)||In Top 2%|
|Price/MAP200||1.09||In Top Quartile|
+ Tobin's Q Ratio, defined as MCap divided by Total Assets, is 1.1. Compared with the rest of the market the stock is undervalued.
+ Net profit margin has averaged 29.4% in the last 3 years. This is considered superior and suggests a high margin of safety.
+ As per the Du Pont analysis, Return on Equity [ROE] of 11.2% is better than sector average of 6.8%. ROE is computed as net profit margin of 34.8% times asset turnover [sales/assets] of 0.16 times leverage factor [total assets/shareholders' equity] of 2.0.
2.4 Undervaluation [compared with sector average]:
+ Return on Equity 11.2% [6.8%].
+ Return on Assets 5.7% [3.6%].
+ Return on Capital Employed 7.7% [4.7%].
SECTION 3 SAUDI BASIC INDUSTRIES PRICE VOLUME DYNAMICS
+ Volume: there were 3,378,921 shares worth SAR415.6 million (US$110.8 million) traded today. In the past week, volume was 1.0 times average and the shares were down 2.8%. The volume was 0.7 times the average daily trading volume of 4.7 million shares.
+ Saudi Basic Industries is at a discount of 6.4% to its 12-month high of SAR131.40 on June 03. It is also at a premium of 29.6% to the 12-month low of SAR94.90 on October 18, 2017.
3.2 Turnover Rate & Turnover Period:
+ The turnover rate in the 12 months to date was 32.9% (or a turnover period of 3 years 15 days). This average length of ownership of the stock at 1.6 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 Saudi Basic Industries would have produced a return of 25.8%.
|TASI:2010||Close (SAR)||Dividends (SAR)||Capital Gain / (Loss) %||% Yield||Annual Return %|
|1 Yr ago||97.8||6||18||7.2||25.2|
|2 Yrs ago||82.9||5.5||(8.3)||6.1||(2.2)|
|3 Yrs ago||90.38||3||(28.1)||2.4||(25.7)|
|4 Yrs ago||125.66||5.5||32.2||5.8||38.0|
Close 5 years ago SAR95.04
+ Beta: the Beta of Saudi Basic Industries stock is 0.8. A Beta lower than 1 suggests this is a low risk, low return stock with volatility less than that of the market.
3.5 The Past Two Years
+ Saudi Basic Industries Corp. (TASI:2010), extended its gains in the past year, rising an additional SAR25.20 (25.8%) to close at SAR123.0 today. In the previous year the shares rose SAR14.95 (18.0%). The shares have lifted SAR40.15 (48.5%) over the past two years, compared with the All Share Index (TASI) which rose 1,538.6 points (24.3%) in the two years for a relative price increase of 24.1%.
SECTION 4 SAUDI BASIC INDUSTRIES RELATED NEWS
+ BSS/News Bites:
Saudi Basic Industries Corp. is placed 27/166 in BSS News Bites' ranking of Saudi Arabian performers in the past year, a percentile ranking of 84.
SECTION 5 SAUDI BASIC INDUSTRIES GLOBAL RANKING
Global Rank [out of 47,646 stocks] and Rank of Saudi Basic Industries in the Middle East & Africa Region [out of 2,279 stocks]
|Description||Value||Global Rank||In MEA Region|
|Total Assets (US$)||86B||562||12|
|Net Profit (US$)||4.9B||204||4|
|Return on Equity %||11.2||11,869||640|
|Net Profit Margin %||34.8||3,128||269|
|Price to Book||2.3||23,028||1,303|
|PV$1000 (1Year) US$*||1,260||7,670||340|
|US$* Change (1Year) %||26.8||7,085||311|
* 1 year ago USD 1 = SAR 3.76
Aug 16, 2018: USD 1 equals SAR 3.75
SECTION 6 SAUDI BASIC INDUSTRIES SUMMARY FINANCIALS
Financials Summary (Past 3 years)
|Year ended||Dec 2017||Dec 2016||Dec 2015|
|Sales (USD B)||14.1||11.7||40.2|
|Pretax (USD B)||5.6||5.6||5.6|
|Net (USD B)||4.9||4.8||5|
+ Sales were up 20.7% from US$11.7 billion in 2016 to US$14.1 billion in 2017.
+ Net profit was up 3.3% from US$4.8 billion in 2016 to US$4.9 billion in 2017.
SECTION 7 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.
7.2 Top Management
The chairman is Abdulaziz Saleh Aljarbou and the chief executive officer is Yousef Abdullah Al-Benyan.
7.3 Issued Capital
Based on 3,000,000,000 issued shares the market capitalisation is SAR369 billion (US$98.4 billion).
Physical Address: PO Box 5101
State/Province/Country: Saudi Arabia
Exchange: Saudi Stock Exchange (Tadawul)
SA:2010; SAU:2010; AB:2010; 2010.SE