Saudi Tadawul Group Holding Company Just Beat Revenue By 6.6%: Here's What Analysts Think Will Happen Next

The second-quarter results for Saudi Tadawul Group Holding Company (TADAWUL:1111) were released last week, making it a good time to revisit its performance. It was a workmanlike result, with revenues of ر.س353m coming in 6.6% ahead of expectations, and statutory earnings per share of ر.س3.25, in line with analyst appraisals. The analysts typically update their forecasts at each earnings report, and we can judge from their estimates whether their view of the company has changed or if there are any new concerns to be aware of. So we gathered the latest post-earnings forecasts to see what estimates suggest is in store for next year.

See our latest analysis for Saudi Tadawul Group Holding

Taking into account the latest results, the current consensus from Saudi Tadawul Group Holding's seven analysts is for revenues of ر.س1.49b in 2024. This would reflect a meaningful 13% increase on its revenue over the past 12 months. Per-share earnings are expected to accumulate 9.8% to ر.س5.12. In the lead-up to this report, the analysts had been modelling revenues of ر.س1.47b and earnings per share (EPS) of ر.س5.12 in 2024. The consensus analysts don't seem to have seen anything in these results that would have changed their view on the business, given there's been no major change to their estimates.

The analysts reconfirmed their price target of ر.س222, showing that the business is executing well and in line with expectations. The consensus price target is just an average of individual analyst targets, so - it could be handy to see how wide the range of underlying estimates is. The most optimistic Saudi Tadawul Group Holding analyst has a price target of ر.س262 per share, while the most pessimistic values it at ر.س162. There are definitely some different views on the stock, but the range of estimates is not wide enough as to imply that the situation is unforecastable, in our view.

Taking a look at the bigger picture now, one of the ways we can understand these forecasts is to see how they compare to both past performance and industry growth estimates. One thing stands out from these estimates, which is that Saudi Tadawul Group Holding is forecast to grow faster in the future than it has in the past, with revenues expected to display 28% annualised growth until the end of 2024. If achieved, this would be a much better result than the 2.2% annual decline over the past three years. Compare this against analyst estimates for the broader industry, which suggest that (in aggregate) industry revenues are expected to grow 7.7% annually. Not only are Saudi Tadawul Group Holding's revenues expected to improve, it seems that the analysts are also expecting it to grow faster than the wider industry.

The Bottom Line

The most important thing to take away is that there's been no major change in sentiment, with the analysts reconfirming that the business is performing in line with their previous earnings per share estimates. Happily, there were no major changes to revenue forecasts, with the business still expected to grow faster than the wider industry. The consensus price target held steady at ر.س222, with the latest estimates not enough to have an impact on their price targets.

Keeping that in mind, we still think that the longer term trajectory of the business is much more important for investors to consider. We have estimates - from multiple Saudi Tadawul Group Holding analysts - going out to 2026, and you can see them free on our platform here.

We don't want to rain on the parade too much, but we did also find 1 warning sign for Saudi Tadawul Group Holding that you need to be mindful of.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.

Have feedback on this article? Concerned about the content? Get in touch with us directly. Alternatively, email editorial-team@simplywallst.com