Al Jouf turns expensive as risks outweigh upside – MubasherTrade

Riyadh – Mubasher: MubasherTrade announced closing its position in Al Jouf Agricultural Development after achieving a decent return of +33.8% and exceeding the target price of SAR 32.19 per share.

The stock outperformed both the Tadawul Index, of which return reached +21.0%, and Tadawul’s Food and Staples Retailing Index with a return of +22.4% over the same investment horizon, according to a statement on Tuesday.

MubasherTrade noted that although the stock is a "good catch" in the market, it is surrounded by key risks that could impact its profitability and financial performance in the long-run.

Al Jouf is currently trading at a price earnings ratio (PER) of 10.2x, higher than the industry’s average of 9.7x (ME&A and global PER: 9.4x and 10.0x, respectively), relatively blurring away the attractiveness of being “cheap” among its peers, the investment company said.

However, Al Jouf stock is still trading way below Tadawul and Tadawul’s Food and Staples Retailing's PER of 17.5x and 22.5x, respectively.

Mubasher Contribution Time: 21-Feb-2017 11:19 (GMT)
Mubasher Last Update Time: 21-Feb-2017 11:25 (GMT)