Samba Financial hits year-low 2nd time in one month 09 October 2019

NEWS BITES - MIDDLE EAST & NORTH AFRICA

Samba Financial Group (TASI:1090), Saudi Arabia's 5th largest Bank by market cap, hit a 52-week low of SAR26.05 during the day. In the last one month Samba Financial's stock has hit a new 52-week low two times. Samba Financial's stock fell for a second day on Wednesday bringing its two-day fall to SAR1.10 (4.1%). Samba Financial's stock price has dropped 75.0 hallalah (2.8%) from its previous trading session to close at SAR26.05. Compared with the All Share Index (TASI) which fell 117.0 points (1.5%) in the day, the relative price change was -1.3%. There were 875,548 shares worth SAR22.8 million (US$6.1 million) traded today.

Stock Summary

CurrencySaudi Riyal (SAR) 1 USD = 3.75 SAR
Today's close (SAR)26.05
52-Week Range (SAR)26.1-38.5
SectorBank sector
Shares Outstanding2,000,000,000
Market CapSAR52.1 billion (US$13.9 billion)

Highlights in today's Report:

SECTION 1 TODAY'S BEARISH SIGNALS

SECTION 2 TODAY'S BULLISH SIGNALS

RECAP FROM PREVIOUS REPORTS (UPDATED AT THE LAST PRICE OF SAR26.05):

SECTION 3 THE PAST WEEK

SECTION 4 ONGOING BULLISH PARAMETERS

SECTION 5 ONGOING BEARISH PARAMETERS

SECTION 6 SUMMARY FINANCIALS

SECTION 7 CORPORATE PROFILE

SECTION 1 SAMBA FINANCIAL BEARISH SIGNALS

1.1 Downtrend:

Price/Moving Average Price and MACD:

+ The Price/MAP of 0.78 for 1090 is lower than the Price/MAP for the All Share Index (TASI) of 0.92.

+ The Moving Average Convergence Divergence (MACD) indicator of 12-day Exponential Moving Average (EMA) of 27.41 minus the 26-day EMA of 28.13 is negative suggesting a bearish signal. Both the 12-day EMA as well as the 26-day EMA are falling, another bearish signal.

+ The price to 50-day EMAP ratio is 0.9, a bearish indicator. In the past 50 days this ratio has been under 0.9 just seven times suggesting a support level. The 50-day EMAP has decreased to SAR29.37. A decrease is another bearish indicator.

+ The stock is trading below both its MAPs and the 50-day MAP of SAR29.38 is lower than the 200-day MAP of SAR33.40, a bearish indicator. The 200-day MAP has decreased to SAR33.40. A decrease is another bearish indicator.

Past Week:

+ Samba Financial Group is placed 165/179 in BuySellSignals' ranking of Saudi Arabian performers in the past week, a percentile ranking of 8.

+ In the past week, volume was 0.6 times average and the shares were down 5.8%. Wednesday's close price is at a 3.2% discount to its 5-day Volume Weighted Average Price (VWAP) of SAR26.92.

Past Month:

+ The present value of SAR1,000 (PV1000) invested one month ago in Samba Financial is SAR917, for a capital loss of SAR83.

Relative Strength (6 months):

+ In the Saudi Arabian market of 180 stocks traded today, the stock has a 6-month relative strength of 3 indicating it is trailing 97.0% of the market.

1.2 Low Price Performance Indicators and rank of Samba Financial in the Saudi Arabian market:

DescriptionValueRank In Market
Price/MAP2000.78In Bottom 7%
Price/MAP500.89In Bottom 7%

SECTION 2 SAMBA FINANCIAL BULLISH SIGNALS

2.1 Undervaluation [compared with sector average]:

Dividend Yield

+ The relative yield of Samba Financial, defined by its yield of 6.6%, divided by average yield of dividend yielding stocks in the All Share Index (TASI) of 3.5% is 189.7%. This suggests Samba Financial stock is undervalued in dividend yield terms.

Price to Book

+ Price to Book of 1.2 [1.8]. We estimate Samba Financial stock is trading at a current year Price to Book of 1.2 and a forward year Price to Book of 1.2.

MCap/Total Assets

+ 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 6% of stock by value of Q Ratio.

2.2 Undervaluation Indicator and rank of Samba Financial in the Saudi Arabian market:

DescriptionValueRank In Market
Dividend Yield %6.6In Top Quartile

2.3 High Price Performance Indicators and rank of Samba Financial in the Saudi Arabian market:

DescriptionValueRank In Market
Today's Trading TurnoverSAR22.8 million (US$6.1 million)In Top 5%
MCapSAR52.1 billionIn Top 5%

2.4 Oversold/Bullish/Support Signals:

+ At SAR26.05 the price is below the lower Bollinger band support of SAR26.35, indicating an upside for it to return to the band.

RECAP FROM PREVIOUS REPORTS (UPDATED AT THE LAST PRICE OF SAR26.05):

SECTION 3 THE PAST WEEK

3.1 Snapshot: Samba Financial stock was down SAR1.60 or 5.8% in the past week. Volume in the week was 0.6 times average trading of 10 million shares. It underperformed the All Share index (TASI) in 4 out of 5 days.

DaySamba FinancialClose price [SAR]Price change %Relative change %Comment
TuesdayHits year-low 1st time in three months26.8-1.3-0.7Price/MAP50 below 1 and falling
MondayTrailing 98% of stocks27.1500.4Price/MAP50 below 1 and falling
SundayConsolidates after 3 days of consecutive falls27.150-0.5Price/MAP50 below 1 and falling
ThursdayKeeps sliding, down 5.1% in 3 days27.15-1.8-1.0Price/MAP50 below 1 and falling
WednesdayDown 3.3% in 2 days27.65-2.0-1.1Steepest Fall

3.2 Volatility:

+ The Samba Financial is at a discount of 32.4% to its 12-month high of SAR38.54 traded on April 02.

SECTION 4 ONGOING BULLISH PARAMETERS

4.1 Past 5 years Annual Net Profit growth:

Annual ReportNet Profit (B SAR)Growth %
20185.5310.1
20175.020.4
20165.0-4.0
20155.214.1
20145.0111.0

Average Annual Compounded rate of growth in Net Profit for the 5 years was muted at 4.2%. There have been four rises and one decline in the past 5 years.

4.2 Moving Annual Return (Past 5 years)

Based on a dynamic start date of 5 years ago, the real rate of return has averaged 10.3%. The Moving Annual Return has been positive in 2 out of 5 years.

1090Close (SAR)Dividends (SAR)Capital Gain / (Loss) %% YieldAnnual Return %
Oct 0926.051.72(13.2)5.7(7.4)
1 Yr ago300.835.23.638.8
2 Yrs ago22.191.7542.811.354.1
3 Yrs ago15.540.9(24.4)4.4(20.0)
4 Yrs ago20.561.15(18.6)4.6(14.0)

Close 5 years ago SAR25.25

4.3 Increased ADVT past five years

Avg. Daily Volume Traded 12 months ended Oct 09, million shares

YearADVT
20192.0
20181.1
20170.83
20160.7
20151.1

In the past five years, Average Daily Volume of Trading (ADVT) has increased 73.8% to 2 million shares.

4.4 Increased VWAP

Past five years, 12 months ended Oct 09 (SAR)

YearHigh PriceVWAPLow Price
201938.5432.526.05
201831.5725.5320.24
201724.4320.5814.0
201621.1718.1914.18
201527.2923.4318.38

In the past five years Volume Weighted Average Price (VWAP) has increased by 38.7% to SAR32.50. Based on a dynamic start date of five years ago, there have been declines in VWAP in 2 out of 5 years.

4.5 Increased Average Daily Turnover

Past five years, 12 months ended Oct 09 (SAR million)

YearAverage Daily Turnover
201964.5
201826.8
201716.9
201611.9
201535.2

In the past five years, average daily share turnover has increased 83.2% to SAR64.5 million (US$17.2 million). This suggests increased liquidity.

4.6 Turnover Rate & Turnover Period:

+ The turnover rate in the 12 months to date was 31.1% (or a turnover period of 3 years 2 months). The average length of ownership of the stock is 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.

SECTION 5 ONGOING BEARISH PARAMETERS

5.1 Performance:

+ Return on Equity 13.1% [15.6%].

+ As per the Du Pont analysis, Return on Equity [ROE] of 13.1% is lower than sector average of 15.6%. ROE is computed as net profit margin of 67.8% times asset turnover [sales/assets] of 0.04 times leverage factor [total assets/shareholders' equity] of 5.4.

SECTION 6 SAMBA FINANCIAL SUMMARY FINANCIALS

6.1 Dividend History

Trailing 12 months dividend for the 12 months ended October 09 has improved from SAR1.15 in 2015 to SAR1.72 in 2019; there were 2 declines in the past 5 years. Dividends were up 115.0% for the 12 months ended October 09 from 80.0 hallalah in 2018 to SAR1.72 in 2019.

6.2 Financials Summary

Year endedDec 2018Dec 2017Dec 2016
Sales (USD B)2.22.12.1
Pretax (USD)--1.3B
Net (USD B)1.51.31.3

+ Sales were up 3.4% from US$2.1 billion in 2017 to US$2.2 billion in 2018.

+ Net profit was up 10.1% from US$1.3 billion in 2017 to US$1.5 billion in 2018.

6.3 Quarterly Report: Key Parameters

Quarterly Report Analysis Q2 2019: Samba Financial reports Revenue of SAR2.2b ($US579m)

Samba Financial (TASI:1090) announced total revenue for the quarter-ended 30 June 2019 of SAR2.2b ($US579m).

Quarter-ended30 Jun [Q2/2019]31 Mar [Q1/2019]31 Dec [Q4/2018]
EPS, hallalah-60.0-
RevenueSAR2.2b ($US579m)SAR2.2m ($US585,407)-
Net ProfitSAR935m ($US249m)SAR1.2m ($US322,157)SAR2.7b ($US723m)
Sequential growth in Net Profit %77,314.06-91.3

Compared with the previous corresponding period [PCP; Q2/2018], year-over-year [y.o.y.] Revenue was up 4.5% and Net Profit was down 33.2%.

Quarter-ended30 Jun [Q2/2019]30 Jun [Q2/2018]
Revenue-SAR2.1b ($US554m)
PCP growth in Revenue %4.46-
Net ProfitSAR935m ($US249m)SAR1.4b ($US373m)
PCP growth in Net Profit %-33.2110.19

Major changes compared with previous corresponding period [Year-on-Year]:

Unfavourable Changes:

- Net profit slumped 33.2% from SAR1.4b ($US373.4m) to SAR935.2m ($US249.4m)

- Profit after tax to Sales down from 67.4% to 43.1%

Note:

- Depreciation to Sales up from 1.4% to 2.2%

Currency Conversion (June 30, 2019): $US1 = SAR3.75

Currency Conversion (June 30, 2018): $US1 = SAR3.75

6.4 Annual Report: Key Parameters

FY2018 Annual Report: Samba Financial Net Profit up 10.1%

Samba Financial (SA:1090) reported net profit for the year-ended 31 December 2018 of SAR5.5b ($US1.5b), up 10.1% from SAR5.0b ($US1.3b) in the previous year.

Major changes compared with previous year:

Favourable Changes:

- Net profit up 10.1% from SAR5.0b ($US1.3b) to SAR5.5b ($US1.5b)

- Return on Equity up from 11.2% to 13.1%

Unfavourable Changes:

- Retained earnings to total assets down 45.9% to 2.0%

Note:

- Working capital to total assets steady at 20.7%

Annual Report [Year-on-year comparison: 2018 vs 2017]

Company Name : Samba Financial Group (1090)
December 312018201720182017Change
DescriptionSAR mSAR m$US m$US m(%)
Operating Income8,156.57,891.62,175.12,104.4Up 3.4
Depreciation112.4123.63033Down 9
Profit/(Loss) after Tax5,528.85,021.11,474.31,339Up 10.1
Working Capital47,611.847,55912,696.512,682.4Up 0.1
Current Assets217,781.8215,546.658,075.257,479.2Up 1
Current Liabilities170,170167,987.645,378.744,796.7Up 1.3
Total Liabilities187,629.8182,928.950,034.748,781.1Up 2.6
Total Assets229,938.3227,611.161,31760,696.4Up 1
Cash and cash equivalents25,419.625,195.16,778.66,718.7Up 0.9
Net Assets42,308.544,682.211,282.311,915.3Down 5.3
Net Tangible Assets42,308.544,682.211,282.311,915.3Down 5.3

Year-on-year comparison of Performance Ratios

December 3120182017Change (%)
Return on Equity (%)13.111.2Up 17

Currency Conversion (December 31, 2018): $US1 = SAR3.75

Currency Conversion (December 31, 2017): $US1 = SAR3.75

Five-year record of growth and performance:

Total Revenue averaged $US2.1B or SAR7.9B over the last 5 years. Net Profit averaged $US1.4B or SAR5.2B over the last 5 years. In the last 5 years Total Revenue averaged SAR7.9B ($US2.1B) and Net Profit averaged SAR5.2B ($US1.4B) Compound Annual Growth Rate (CAGR) averaged 1.8% for Total Revenue and 4.2% for Net Profit.

DescriptionAnnual (SAR B)Annual ($US B)5-year Avg (SAR B)5-year Avg ($US B)5-year CAGR %
Total Revenue8.22.27.92.11.8
Net Profit5.51.55.21.44.2

SECTION 7 CORPORATE PROFILE

7.1 Activities

Samba is a leading financial services group in Saudi Arabia, providing world class services to meet the financial needs of its private, corporate and institutional customers in the Kingdom of Saudi Arabia, Pakistan, Dubai and the United Kingdom. Its strong suite of comprehensive and integrated conventional and Shariah-compliant financial products and services as well as financial advisory services has propelled Samba to the top tier of Saudi Financial institutions. The Bank aims to invest in its staff, reinforce its social responsibility and maximize its shareholders returns. Samba was the first Bank in Saudi Arabia to offer Priority Banking (Gold and Diamond), Phone Banking, ATMs and Cash Deposit through ATMs, Debit Cards, Charge Cards, Islamic Credit Cards, Co-Branded Credit Cards, AlKhair Credit Cards for ladies, Murabaha-Based Cash Financing, Phone Banking, Leasing (Ijarah), Foreign Exchange Derivatives, Interest Rate Derivatives, Credit Shield Insurance, and Automated Signature Verification.

7.2 Issued Capital and MCap

Based on 2,000,000,000 issued shares the market capitalisation is SAR52.1 billion (US$13.9 billion).

7.3 Vanguard Total World Stock ETF 7636:

The stock was one of 7636 global stocks selected by Vanguard Total World Stock ETF (VT). As at Jul 31, 2019, the Vanguard Total World Stock ETF held 165,745 shares worth $US1,520,657 or 0.01% by value of the ETF's portfolio [Ranked 1683 out of 7636 by value and 6 out of 56 for Saudi Arabia].

COMPANY IDENTIFIERS

Contact: 96614774770

Physical Address: PO Box 833 11421

Riyadh

Kingdom Of Saudi Aarabia

State/Province/Country: Saudi Arabia

Exchange: Saudi Stock Exchange (Tadawul)

Economic Sector: Financials

Business Sector: Banking & Investment Services

Industry Group: Banking Services

Industry: Banks

ISIN: SA0007879097

SA:1090; SAU:1090; AB:1090; 1090.SE

PermID: 4295887282

RIC: 1090.SE

Source: www.BuySellSignals.com