Ratio Specialty Company operates in the restaurant and cafe sector, playing a key role in franchising and supply chain management.

Saudi Arabia

Ratio Speciality Company for Trading

Consumer Cyclical

The company does not pay dividends at all, or it pays them sporadically. There have only been a few years with dividend payments in the past ten years. 

Over the past six months, the stock has consistently climbed, resulting in 0% total increase. When measured against its worldwide peers from the same industry (as shown above), the stock has been weaker, underperforming by 2ppts. There is a distinction between the stock's performance and that of its peers from the same country and industry. Over six months it exceeded the performance of this peer group by 13ppts and its growth decelerated by 0ppts in the previous month. Given the stock's valuation versus its peers, its total price movement is neither favourable nor unfavourable.

The ratio of return on invested capital (RoIC) to the weighted average cost of capital (WACC) has been 9.8 in the past several years. This ratio implies a excellent shareholder value creation. 

The institutional, legal, and compliance risks associated with the company's country are close to minimal. In combination with rigorous business standards, shareholder rights are well protected.

9630.SR has very poor trading liquidity. It will take considerable time for the average private investor to sell a common position under normal market conditions. Liquidity may be unstable and becomes extremely unfavourable on the days with the lowest activity. The trading volume mostly stays the same even under highly turbulent market conditions. The stock has a tiny market capitalisation, which usually makes its trading liquidity erratic and unpredictable. 

No other major risks have been identified.

The risk of default is moderate. We note robust profitability, strong debt servicing capacity, solid cash flow generation, and an favourable capital structure, among the positive credit factors. Among the negative credit factors, we point to weak positions in its industry, negligible return on capital, excessive margin volatility, and poor working capital management.

In highly turbulent market conditions, 9630.SR is moderately volatile. In other words, the stock will fall more than the index in times of extreme market volatility or shocking company news. Standalone, the worst-day losses (less than 1% of the time) will likely be moderate. 

In normal market circumstances, 9630.SR is volatile. Put differently, without outstanding market volatility or shocking company news, the stock's price will move much wider than the index. The stock's losses on its worst days (less than 1-5% of the time) will range from very low to minimal. 

Considering past and projected metrics, the stock is distinctly 'expensive' compared to its peers. In particular, the stock is reasonably priced on P/E, 'expensive' on EV/EBITDA, overvalued on P/FCF. 

Ratio Speciality Company for Trading

SAR 9.2

3

Ratio Speciality Company for Trading

SAR 9.2

3

Risk factor

Profitability factor

Risk / Profitability

Risk factor

Profitability factor

SAR 9.2

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