Saudi Arabian Oil Company (TADAWUL:2222) Just Reported Annual Earnings: Have Analysts Changed Their Mind On The Stock?

Saudi Arabian Oil Company (TADAWUL:2222) shareholders are probably feeling a little disappointed, since its shares fell 3.1% to ر.س26.25 in the week after its latest full-year results. It was a workmanlike result, with revenues of ر.س1.8t coming in 2.7% ahead of expectations, and statutory earnings per share of ر.س1.63, in line with analyst appraisals. This is an important time for investors, as they can track a company's performance in its report, look at what experts are forecasting for next year, and see if there has been any change to expectations for the business. So we collected the latest post-earnings statutory consensus estimates to see what could be in store for next year.

View our latest analysis for Saudi Arabian Oil

Following the recent earnings report, the consensus from 14 analysts covering Saudi Arabian Oil is for revenues of ر.س1.66t in 2025. This implies a measurable 7.8% decline in revenue compared to the last 12 months. Per-share earnings are expected to increase 2.3% to ر.س1.67. In the lead-up to this report, the analysts had been modelling revenues of ر.س1.64t and earnings per share (EPS) of ر.س1.68 in 2025. 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.

There were no changes to revenue or earnings estimates or the price target of ر.س30.82, suggesting that the company has met expectations in its recent result. Fixating on a single price target can be unwise though, since the consensus target is effectively the average of analyst price targets. As a result, some investors like to look at the range of estimates to see if there are any diverging opinions on the company's valuation. The most optimistic Saudi Arabian Oil analyst has a price target of ر.س35.00 per share, while the most pessimistic values it at ر.س26.50. With such a narrow range of valuations, the analysts apparently share similar views on what they think the business is worth.

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. These estimates imply that revenue is expected to slow, with a forecast annualised decline of 7.8% by the end of 2025. This indicates a significant reduction from annual growth of 14% over the last five years. By contrast, our data suggests that other companies (with analyst coverage) in the industry are forecast to see their revenue decline 1.5% annually for the foreseeable future. The forecasts do look bearish for Saudi Arabian Oil, since they're expecting it to shrink faster than the industry.

The Bottom Line

The most obvious conclusion is that there's been no major change in the business' prospects in recent times, with the analysts holding their earnings forecasts steady, in line with previous estimates. They also made no changes to their revenue estimates, implying the business is not expected to experience any major impacts to the current trajectory in the near term, even though it is expected to trail the wider industry. The consensus price target held steady at ر.س30.82, with the latest estimates not enough to have an impact on their price targets.

With that in mind, we wouldn't be too quick to come to a conclusion on Saudi Arabian Oil. Long-term earnings power is much more important than next year's profits. At Simply Wall St, we have a full range of analyst estimates for Saudi Arabian Oil going out to 2027, and you can see them free on our platform here..

Before you take the next step you should know about the 1 warning sign for Saudi Arabian Oil that we have uncovered.

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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.