EFG Hermes: Raise the recommendation on Mobily from “neutral” to “buy”

Telecommunications analyst at Hermes financial group Omar Maher confirmed that Etihad Etisalat’s “Mobily” recommendation had been raised by “neutral” on the purchase.

He added in an interview with “Al-Arabiya”, today, Thursday, that Mobily’s distributions fluctuate between 65-70% of expected profits, compared to 49% last year, and therefore the current distributions are higher in their ratio on earnings compared to the historical levels of the company.

Omar Maher attributed the dividend increase to the strong performance financial position, the confidence of the company’s management in the financial position and good financial flows of Mobily, with expectations of continuous improvement in performance in future.

He explained that the increase in the recommendation to buy the stock is due to several factors, including the attractiveness of the stock due to high cash flows, continuous improvement and the possibility of distributing higher profits than last year. noting that Hermes’ expectations indicate the continuation of strong profit growth over the next five years.

He added that the performance in terms of revenues and profit margins in 2020 and 2021 was good, despite all the difficulties arising from the Corona pandemic.

The telecommunications industry analyst expects Mobily to continue his performance current, with a slight increase in margins in the coming years.

He added that the rating of “Mobily” in terms of multiples of profitability and compared to the historical levels of Mobily is considered low, and also compared to the Saudi Telecom Company it is low.

Etihad Etisalat Company, “Mobily”, had announced the Board of Directors’ recommendation to distribute dividends in cash to shareholders for fiscal year 2021.

The company stated, in a statement to Saudi Tadawul that the total amount recommended by the board for distribution is 654.5 million riyals and will be distributed to 770 million shares.

The company clarified that the share of the share in the distributions amounts to 0.85 riyals, compared to the 0.5 riyals of the previous distributions.

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