Saudi Ceramic Surges to 7-Year High on Profit Bets: Riyadh Mover
Stock Chart for Saudi Ceramic (SCERCO)
Saudi Ceramic Co. (SCERCO), a manufacturer and retailer of bathroom fixtures and floor tiles, soared to the highest level in more than seven years on bets second-quarter profit will improve.
Shares of the Riyadh-based company rallied 3.3 percent to 111.25 riyals, the highest close since March 2006. The stock was the third-biggest gainer in percentage terms on the benchmark Tadawul All Share Index, which declined 0.2 percent.
Saudi Ceramic, which also produces electric water heaters and porcelain tiles, posted a 31 percent increase in first-quarter profit to 82 million riyals ($22 million). The stock has surged 34 percent this quarter, outpacing a gain of 5.3 percent for the Tadawul, the Arab world’s biggest bourse.
“Saudi Ceramic’s shares have been increasing over the last two months, driven by strong first-quarter results on solid improvement in margins,” said Tarek El Shawarby, a Cairo-based analyst at EFG-Hermes Holding SAE. “The continuous share-price increase might be due to anticipation of another strong quarter performance.”
El Shawarby predicts the company will post a 21 percent increase in full-year net income to 300 million riyals, according to data compiled by Bloomberg. Saudi Arabia plans to build 500,000 homes as part of infrastructure investments exceeding $500 billion. This year’s spending target is a record 820 billion riyals, according to the 2013 budget.
Two analysts have a buy rating on Saudi Ceramic, while one recommends investors hold the shares and one says sell, according to data compiled by Bloomberg. The company may post quarterly results on July 15, the data show.
Over half a million shares were traded today, more than double the three-month daily average.
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