Riyad Cap maintains ‘hold’ on Almarai; TP kept at SAR 81

Riyad Capital, the investment arm of Riyad Bank, has maintained a “hold” recommendation on Almarai Co. and kept the share’s target price unchanged at SAR 81, the firm said in a report released on Monday.

Almarai’s fourth quarter net profit is expected to grow to SAR 488 million, a nine percent year-on-year (YOY) increase, Riyad Capital added.

The poultry division witnessed a slowdown in the third quarter due to seasonal factors, but the firm expects a better performance in fourth quarter.

“Cash flow breakeven this year followed by a profit next year remains management targets for the poultry segment,” the firm said in the report.

Almarai’s stock has underperformed the TASI index by -5 percent in fourth quarter so far, and it isn’t expected it to improve in the near future, Riyad Capital added.

The stock, however, remains a favorite investment for both local and foreign investors.