Riyadh - Mubasher: Al Rajhi Capital Research has maintained its Neutral recommendation on Jarir Marketing, but raised the company’s stock target price (TP) to SAR 177 per share, from SAR 166.

The company’s earnings during the third quarter of the year increased by 16.8% year-on-year to reach SAR 288 million, beating estimates of SAR 258 million.

The research firm expects Jarir to steadily increase its number of stores, enabling it to capture higher market share amid shift of market towards organized players.

Jarir Marketing has benefitted from successfully implementing its strategy of adjusting its product mix in line with changing consumer behavior, Al Rajhi said in a research note on Tuesday, noting that the company remains one of the attractive dividend players in the Saudi market.

Jarir Marketing reported a 16.4% year-on-year profit rise in the third quarter of 2018 to SAR 338.6 million ($90.27 million) during Q3-18, compared to SAR 290.7 million ($77.50 million) in Q3-17.

Quarter-on-quarter, profits levelled up 59.3% in the July-September period, from SAR 212.5 million.

Revenues jumped 17% to SAR 1.93 billion in Q3-18, from SAR 1.65 billion in the corresponding period of 2017.

The firm’s net profits after calculating Zakat and Tax levelled up 16.8%, reaching SAR 288 million from July to September, compared to SAR 246.5 million in the prior year period.

Jarir ascribed the third-quarter profit hike to a rise in sales driven by a growth in smartphones’ sales, coupled with a decline in selling and marketing expenses.

During the first nine months, the Saudi firm’s profits rose 8.62% to SAR 793.8 million, up from SAR 730.8 million during the year-ago period.

Sales grew 5.7% to SAR 5.2 billion from January to September, compared to SAR 4.9 billion in the corresponding month a year earlier.

Jarir’s net profits after calculating Zakat and Tax increased 8.77% year-on-year to SAR 669.7 million in the nine-month period, compared to SAR 615.7 million.

Earnings per share (EPS) amounted to SAR 7.4 in 9M-18, compared to SAR 6.8 in the same period in 2017.