Saudi Telecom Company SJSC

Saudi Telecom Company maintains a conservative capital structure with a debt-to-equity ratio of 0.23 and a current ratio of 1.44, indicating adequate short-term liquidity coverage. The balance sheet shows total assets of SAR 157.48 billion against total liabilities of SAR 74.06 billion, with long-term debt standing at SAR 19.45 billion. Cash and equivalents total SAR 5.41 billion, which is insufficient to cover total debt, resulting in a negative net cash position as flagged in the risk assessment. Operating cash flow is robust at SAR 18.28 billion, but free cash flow turns negative at SAR -7.53 billion due to significant capital expenditures of SAR 11.79 billion, suggesting heavy reinvestment in infrastructure.

Profitability metrics demonstrate strong returns on capital, with a return on equity of 17.83% and a return on assets of 9.45%. The company generated net income of SAR 14.83 billion on revenue of SAR 77.82 billion, yielding a net margin of approximately 19.05%. Operating income stands at SAR 13.61 billion, reflecting an operating margin of roughly 17.49%. While cohort medians are not provided for direct comparison, these returns are indicative of a mature, cash-generative business model typical of leading telecom operators in emerging markets.

Revenue concentration and segment details are not explicitly broken down in the available data, but the company’s primary activity is identified as Electric Utilities within the classification framework, though sector classification codes point to Diversified Telecommunication Services. The absence of specific geographic or segment revenue splits limits the ability to assess concentration risk beyond the national scope implied by the company’s domicile and primary market.

Growth trajectory analysis is constrained by the absence of historical period data in the input. The latest normalized period shows revenue of SAR 77.82 billion and net income of SAR 14.83 billion, but without prior year or quarterly trends, year-over-year growth rates cannot be calculated. The high level of capital expenditure relative to operating cash flow suggests the company is in an investment phase, potentially for 5G or fiber infrastructure, which may pressure near-term free cash flow but support long-term revenue growth.

Risk factors include medium liquidity risk and low dilution risk, with a key flag noting that net cash is negative after subtracting total debt. The negative free cash flow of SAR -7.53 billion highlights the strain on liquidity from high capital expenditures, although the strong operating cash flow provides a buffer. The debt-to-equity ratio of 0.23 remains low, mitigating solvency concerns despite the negative net cash position.

Recent events and market sentiment are reflected in analyst estimates, with a mean price target of SAR 48.05 and a median target of SAR 47.00, ranging from a low of SAR 41.10 to a high of SAR 55.00. The mean recommendation is 2.38, with 3 strong buys, 4 buys, and 9 holds, indicating a cautious but generally positive outlook from the analyst community. No specific filing, news, or transcript observations are provided in the input data.

Revenue grew at a 5.2% CAGR from 2022 to 2026, demonstrating consistent top-line expansion over the four-year period.

Net margin of 17.3% exceeds the 75th percentile of the integrated telecommunications services cohort, indicating superior profitability.

Analysts project 10.1% upside to a mean price target of 48.59 SAR, based on a current market price of 44.12 SAR.

Cash conversion ratio of 2.32 is above the cohort median of 1.64, suggesting effective translation of earnings into cash.

The company carries a high credit risk flag, indicating significant concerns regarding its ability to meet financial obligations.

Return on equity of 4.3% falls below the cohort median of 4.8%, underperforming peers in generating shareholder value.

Revenue SAR 19.94B, +3,8% YoY; Operating income +11,4% YoY.

• ▍Revenue SAR 19.94B, +3,8% YoY
• ▍Operating income +11,4% YoY
• ▍Net income +1,3% YoY
• ▍Free cash flow +2,6% YoY
• ▍Net margin 18.5%

Revenue SAR 19.89B, +3,3% YoY; Operating income +204,8% YoY.

• ▍Revenue SAR 19.89B, +3,3% YoY
• ▍Operating income +204,8% YoY
• ▍Net income −75,9% YoY
• ▍Free cash flow +23,8% YoY
• ▍Net margin 16.3%

Revenue SAR 19.26B, +3,3% YoY; Operating income −16,8% YoY.

• ▍Revenue SAR 19.26B, +3,3% YoY
• ▍Operating income −16,8% YoY
• ▍Net income −11,5% YoY
• ▍Free cash flow −6,4% YoY
• ▍Net margin 21.3%

Revenue SAR 19.45B, +1,6% YoY; Operating income −5,2% YoY.

• ▍Revenue SAR 19.45B, +1,6% YoY
• ▍Operating income −5,2% YoY
• ▍Net income +15,7% YoY
• ▍Free cash flow −908,9% YoY
• ▍Net margin 19.7%

Revenue SAR 19.21B; Operating income SAR 3.34B.

• ▍Revenue SAR 19.21B
• ▍Operating income SAR 3.34B
• ▍Net margin 19.0%

Revenue SAR 19.27B; Operating income SAR 1.12B.

• ▍Revenue SAR 19.27B
• ▍Operating income SAR 1.12B
• ▍Net margin 69.8%

Revenue SAR 18.64B; Operating income SAR 4.14B.

• ▍Revenue SAR 18.64B
• ▍Operating income SAR 4.14B
• ▍Net margin 24.9%

Revenue SAR 19.15B; Operating income SAR 3.60B.

• ▍Revenue SAR 19.15B
• ▍Operating income SAR 3.60B
• ▍Net margin 17.3%

Revenue SAR 77.82B, +2,5% YoY; Operating income +14,9% YoY.

• ▍Revenue SAR 77.82B, +2,5% YoY
• ▍Operating income +14,9% YoY
• ▍Net income −39,9% YoY
• ▍Free cash flow −666,5% YoY
• ▍Net margin 19.1%

Revenue SAR 75.89B, +5,7% YoY; Operating income −4,7% YoY.

• ▍Revenue SAR 75.89B, +5,7% YoY
• ▍Operating income −4,7% YoY
• ▍Net income +85,7% YoY
• ▍Free cash flow −122,1% YoY
• ▍Net margin 32.5%

Revenue SAR 71.78B, +6,4% YoY; Operating income −15,7% YoY.

• ▍Revenue SAR 71.78B, +6,4% YoY
• ▍Operating income −15,7% YoY
• ▍Net income +9,2% YoY
• ▍Free cash flow −33,8% YoY
• ▍Net margin 18.5%

Revenue SAR 67.43B, +6,3% YoY; Operating income +14,8% YoY.

• ▍Revenue SAR 67.43B, +6,3% YoY
• ▍Operating income +14,8% YoY
• ▍Net income +7,6% YoY
• ▍Free cash flow +115,7% YoY
• ▍Net margin 18.0%