Al-Rajhi Capital has stated in a report that Herfy’s Q1-14 earnings were in line with its estimates, but slightly lower than the consensus forecasts.

The company’s revenue and net profit grew at a low-single-digit rate, as it has been under pressure, owing to the cut in religious visas and the departure of illegal foreign workers.

Nevertheless, with the company opening five new restaurants in the first quarter alone (it had opened 7 new restaurants in 2013), Al-Rajhi expects growth to revive in the coming quarters.

The research firm revised its estimates on Herfy, taking into account the latest developments.

Based on the new estimates, Al-Rajhi has raised its target price to SAR135 per share, while continuing with its ‘Neutral’ recommendation.