Sulaiman Al Habib Group Q4 2020 profit below expectation, TP raised to SAR 99: Riyad Cap

A hospital of Dr. Sulaiman Al Habib Medical Group

Dr. Sulaiman Al Habib Medical Group’s (HMG) Q4 2020 net profit of SAR 318 million came below Riyad Capial’s expectations of SAR 362 million, on the back of subdued revenue growth as well as margin contraction as compared to estimates, the research firm said in an earnings review.

The bottomline for 2020 rose 21.3% year-on-year (YoY) to SAR 1.06 billion, driven by an increase in inpatient occupancy.

The opening of a primary care center in Riyadh should help the financials in the second half of 2021, while the Khobar hospital continues to grow, the report said.

Expectations on dividend yield stand at 2% for 2021.

Riyad Capital maintained “Neutral” rating on the stock, but raised its target price (TP) to SAR 99 from SAR 90.

“Neutral” rating, according to Riyad Capital, implies expected total return between -15% and +15%.