Riyadh - Mubasher: Al Rajhi Capital placed an overweight rating on Advanced Petrochemicals Company (APC) with a target price (TP) of SAR 44 per share, the research firm said in a report on Wednesday.
APC is trading at low valuation multiple compared to peers and is less directly impacted by recent austerity measures in Saudi Arabia, the report said.
Advanced Petrochemicals results reported in the third quarter of 2016 were marginally lower than consensus and our estimates, it added.
“The company’s operational performance continues to be intact, broadly maintaining its high utilization rates.”
Sharper quarter-on-quarter decline in propane prices as compared to polypropylene has helped the company report a higher gross profit margin in Q3-16 as compared to last quarter.
Q3 is an affirmation of APC’s sturdy performance, with dividend per share for Q3 was announced at SAR 0.65, it implies an expected dividend yield of 6.8%, which in current market conditions is attractive, the report indicated.
