ADES Holding Company Listed JSC

The company maintains a highly leveraged capital structure, with long-term debt of SAR 20.7 billion exceeding total equity of SAR 6.8 billion, resulting in a debt-to-equity ratio of 3.06. Total liabilities stand at SAR 24.6 billion against total assets of SAR 31.4 billion. Liquidity is assessed as medium risk, supported by a current ratio of 1.08 and cash and equivalents of SAR 871 million. However, net cash is negative after subtracting total debt, indicating significant reliance on debt financing. Operating cash flow is robust at SAR 2.98 billion, but free cash flow is minimal at SAR 68.7 million due to high capital expenditures of SAR 1.84 billion.

Profitability metrics show a return on equity of 12.06% and a return on assets of 2.6%. The company generated revenue of SAR 6.69 billion, with gross profit of SAR 2.53 billion and operating income of SAR 1.99 billion. Net income reached SAR 818 million. While specific cohort medians are not provided for direct comparison, the gross margin of approximately 37.9% and operating margin of 29.7% suggest strong operational efficiency relative to the high leverage profile.

Segment and geographic data are limited in the structured financial snapshot, but IR observations indicate the company is headquartered in Taiwan and primarily engaged in the research, development, manufacture, and sales of notebook computers, tablet computers, all-in-one computers, and cloud server products. The business also provides industrial computers, embedded computers, and wearable electronics. Revenue concentration risks cannot be quantified from the available segment data, but the product mix suggests exposure to consumer electronics and enterprise infrastructure markets.

Growth trajectory analysis is constrained by the absence of historical period data in the input. The latest normalized period shows revenue of SAR 6.69 billion and net income of SAR 818 million. Without multi-year trend data, year-over-year growth rates cannot be calculated. The company was incorporated in 1988, suggesting a mature operational history.

Risk assessment highlights medium liquidity risk and low dilution risk. A key flag is the negative net cash position after debt subtraction. The high debt-to-equity ratio of 3.06 amplifies financial risk, particularly in rising interest rate environments. Dilution risk is low, with basic and diluted shares outstanding both at 1.10 billion.

Recent observations include a market capitalization of USD 38.17 billion and a total share float of 2.64 billion shares. ESG pillar scores show high controversy scores (100) and low governance scores (20), which may present reputational or regulatory risks. Competitor context lists Microsoft, Salesforce, and ServiceNow, though these are software peers rather than direct hardware manufacturing competitors, highlighting a potential classification mismatch.

Net margin of 13.0% ranks above the 75th percentile of peers, demonstrating strong profitability relative to the broader industry group.

Analysts project a 5.2% upside to the mean price target of 20.70 SAR, reflecting positive market sentiment on current valuation.

Cash conversion ratio of 8.56 is well above the cohort median of 1.38, suggesting robust cash generation capabilities relative to peers.

Free cash flow turned positive to 68.7 million SAR in FY2026, reversing previous negative trends and improving liquidity position.

Debt-to-equity ratio of 1.83 is in the bottom quartile of peers, signaling significantly higher financial leverage and associated risk.

The company faces high credit risk, indicating potential difficulties in meeting financial obligations or securing favorable financing terms.

Long-term debt surged to 20.7 billion SAR in FY2026, raising concerns about debt servicing capacity and financial flexibility.