Yansab Drops as Saudi Petrochem Profits Disappoint: Riyadh MoverDeema Almashabi
Yanbu National Petrochemicals Co. fell the most in three weeks after second-quarter profit at the unit of Saudi Basic Industries Corp. missed estimates.
Shares of the company known as Yansab decreased 1.7 percent, the largest retreat since June 22, to 56.75 riyals at the close in Riyadh. The stock was the fourth-biggest decliner on the Tadawul All Share Index, which slid 0.6 percent. Sabic, the world’s largest petrochemicals company by market value, fell 1.3 percent, the most in a month.
Yansab’s quarterly net income of 670.5 million riyals ($179 million) came below the 737 million-riyal average estimate of 10 analysts compiled by Bloomberg. Sabic affiliate Saudi Arabian Fertilizer Co., or Safco, lost 0.2 percent after the company also reported profit that missed estimates. The Tadawul petrochemicals index declined 0.9 percent, set for the biggest drop in more than three weeks.
“We consider that the weakness in the petrochemical sector is primarily a reflection of reported earnings missing the market expectations,” Ankit Gupta, a Dubai-based equity analyst and assistant vice-president of research at NBK Capital, said by e-mail. “Yansab’s second-quarter results underscore the company’s operational resilience, however, it is mostly priced in the stock.”
Six analysts recommend investors buy Yansab shares, while ten have a hold rating on the stock and one advises selling it, data compiled by Bloomberg show. Today’s drop trimmed the stock’s advance this year to 20 percent, compared with 13 percent for Tadawul.