Albilad Capital issues Q2 forecasts; Al Rajhi Bank to rise 7%

Albilad Capital has issued earnings estimates for Q2 2017, which coincided with the beginning of summer vacation, Ramadan, and Eid Al-Fitr.

"We expect that many companies will be affected by previous factors and seasonality of each sector,” the brokerage said in an earnings preview.

In the banking sector, Al Rajhi Bank is forecasted to report SAR 2.2 billion earnings in Q2, rising 7 percent year-on-year (YoY).

Bank Aljazira is estimated to post an 11 percent year-on-year (YoY) hike in Q2 2017 earnings to SAR 197 million, boosted by the government's decision to restore state employees’ allowances and bonuses, which will reflect positively on the growth of deposits and loans compared to Q2 2016.

Total deposits of the banking sector are expected to increase slightly by 0.83 percent YoY, while loans are expected to decline 1.6 percent YoY, Albilad Capital said.

Among petrochemical stocks, Saudi Basic Industries Corporation (SABIC) is expected to post a net profit of SAR 4.6 billion in Q2 2017, down 3 percent YoY, hurt by declining product prices and oil prices.

Elsewhere, Saudi Arabian Mining Co. (Maaden) is projected to generate SAR 340 million in net profit in Q2, surging 139 percent YoY.

Saudi Telecom Co. (STC) is seen reporting a net profit of SAR 2.4 billion in Q2 2017, up 31 percent YoY on higher demand for telecommunications services during Ramadan and Eid Al-Fitr.

In the cement sector, Yamama Cement’s Q2 net profit is expected to plunge 54 percent to SAR 53 million, on reduced demand on cement due to seasonality and high temperatures.

"We expect cement sales to fall below 12 million tons in Q2 2017", Albilad Capital said in the report.

The healthcare sector’s Q2 results are likely to be negatively affected by Ramadan, mainly due to the reduction of official working hours, in addition to being adversely affected by the summer vacation.

However, Dallah Healthcare's Q2 profit is expected to jump by 24 percent YoY to SAR 67 million.