Riyadh – Mubasher: MubasherTrade Research(MTR) said it cut the Price Target (PT) of Jarir Marketing Company by 27% to SAR139.5 (ETR: +18%),while maintained Buy/Moderate Risk rating.
The research unit pointed out that Jarir’s overall results has missed both its forecasts and the consensus estimates for second consecutive quarter, mainly due to lower-than-expected margins.
Accordingly, MTR downgraded its estimated 2016e EBITDA margin by 3.3 percentage points to 10.4% compared to our previously estimated margin of 13.7%.
MTR expects that EBITDA will grow at a 5-year CAGR of 3.5% vs. its previous estimated CAGR of 9.0%.Meanwhile, MTR maintained its top-line estimates
The research house said it maintain its positive view on Jarir's future growth based on number of key drivers; namely showrooms spread across Saudi Arabia and GCC markets with ambitious expansion plans, favorable demographics of Saudi Arabia in terms of population and high purchasing power, strong demand for smartphones and laptops due to the continuous growth of internet usage, continuous development and upgrade of technologies and electronic products and diversification of electronic and educational products.
