Safco Gains Most This Year as Board Recommends 6-Riyal Dividend
Safco, as the fertilizer maker is known, gained 4.4 percent to 153.5 riyals, the most since Dec. 8, at 2 p.m. in Riyadh. The stock was the biggest gainer on the benchmark Tadawul All Share Index, which was little changed. The shares have increased 0.8 percent this year compared with a 13 percent jump for the benchmark gauge.
The company, which announced a cash and stock dividend in the year-earlier period, will post a 3 percent decline in second-quarter profit, according to the mean estimate of eight analysts on Bloomberg. The price of urea, which is a source of nitrogen used by farmers to boost crops, has declined 12 percent this year.
“The dividend yield on the stock remains attractive,” Ankit Gupta, Dubai-based equity analyst and assistant vice president of research at NBK Capital, said in an e-mailed comment. “However, the urea market fundamentals remain weak.”
Five analysts have a buy rating on Safco, while ten recommend investors hold the stock and one advises investors to sell, according to data compiled by Bloomberg.
To contact the editor responsible for this story: Shaji Mathew at email@example.com