Article Hero

Riyad Bank Stock (Tadawul:1010)

10 minutes
beginner
Riyad_bank.jpg
Cristian Cochintu
Cristian Cochintu
13 October 2023

Despite a grim 2022, Riyad Bank stock (Tadawul: 1010) remain very popular among Saudia investors and top-performing international funds. While you can buy Riyad Bank shares directly, sometimes it is worth considering an ETF with Riyad Bank representation. 

Riyad Bank is a leading financial institution in Saudi Arabia, offering a range of banking and financial services to individuals, businesses, and government organizations. Established in 1957 and headquartered in Riyadh, Riyad Bank is one of the largest banks in the country. 

Riyad Bank's shares are listed on the Saudi Stock Exchange (Tadawul) under the ticker symbol "1010" and are widely held by a diverse range of investors, including both domestic and international institutional investors, as well as individual investors. A popular choice among investors looking to gain exposure to the Middle Eastern banking sector, “Tadawul: 1010” has also been included in various global indices and exchange-traded funds (ETFs), such as the iShares MSCI Saudi Arabia ETF (KSA).  

Tadawul: 1010 - Research and Ratings

  • Is Riyad Bank stock undervalued compared to its fair value, analyst forecasts, and its price relative to the market?  
  • What is the analyst's 12-month Riyad Bank stock price forecast? 
  • What are Riyad Bank’s future growth expectations? 
  • How has STC stock performed over the past 5 years? 
  • Should you buy Telecom shares or invest in ETFs with "7010" representation?

    

Understanding Riyad Bank Stock (Tadawul: 1010): A brief history 

Riyad Bank is one of the largest financial institutions in Saudi Arabia, offering a wide range of banking and financial services to individuals, businesses, and government organizations. 

Historically, Riyad Bank has focused on serving the following market segments: 

  • Retail Banking: Riyad Bank has a strong presence in the retail banking market, offering a range of personal banking products and services, such as savings accounts, credit cards, personal loans, mortgages, and wealth management services. 
  • Corporate Banking: Riyad Bank provides a range of financial products and services to large and small businesses in Saudi Arabia, including project financing, working capital financing, trade finance, cash management, and treasury services. 
  • Investment Banking: Riyad Bank has an active investment banking division, which provides services such as mergers and acquisitions advisory, underwriting, private placements, and equity and debt capital markets. 
  • Islamic Banking: Riyad Bank has a dedicated Islamic banking unit, which offers Shariah-compliant banking products and services, such as Murabaha, Mudarabah, and Musharakah. 
  • International Banking: Riyad Bank has a strong international presence, with a network of correspondent banks and representative offices in major financial centers around the world. The bank offers a range of international banking services, including trade finance, foreign exchange, and correspondent banking services. 
  • Private Banking: Riyad Bank also has a private banking division that provides specialized banking and investment services to high-net-worth individuals and families. This includes investment advisory services, asset management, and wealth planning. 

Riyad Bank shares are distributed among 5 categories:  

  • General Public: 45.9% 
  • Sovereign Wealth Funds: 21.8% 
  • Private Companies: 16.8% 
  • State or Government: 10.4% 
  • Institutions: 5.1% 
  • Individual Insiders: 0.1% 

The top 25 shareholders own 53.75 % of the Bank, while the top 5 shareholders are: 

  • The Public Investment Fund of The Kingdom of Saudi Arabia - 21.78% 
  • General Organization for Social Insurance - 10.4% 
  • Al Nahla Group of Companies - 8.75% 
  • Assila Investments Co. - 8.1% 
  • The Vanguard Group, Inc. - 1.99% 

Tadawul: 7010 - Fundamental Analysis and Financial Ratings 

See the latest “Tadawul: 1010” stock price analysis, including valuation, future growth, past performance, and more to help you make more informed investing decisions. 

Valuation 

Is Riyad Bank Stock (Tadawul: 1010) undervalued compared to its fair value, analyst forecasts, and price relative to the market? 

  • Riyad Bank shares are good value based on its Price-To-Earnings Ratio (10.2x) compared to the peer average (14.4x). 
  • Riyad Bank shares are expensive based on its Price-To-Earnings Ratio (10.2x) compared to the Asian Banks industry average (8.7x). 
  • Riyad Bank shares are good value based on its Price-To-Earnings Ratio (10.2x) compared to the estimated Fair Price-To-Earnings Ratio (12.7x). 
  • Riyad Bank shares (SAR26) are trading above analysts' estimate of fair value (SAR17.03). 

Future Growth 

Riyad Bank's earnings per share are expected to grow by 8.6%. The return on shareholders' equity is expected to reach 14.6% within 3 years.

  • Earnings vs Savings Rate: Riyad Bank's forecast earnings growth (9.8% per year) is above the savings rate (9.1%). 
  • Earnings vs Market: Riyad Bank's earnings (9.8% per year) are forecast to grow faster than the Saudi market (2.8% per year). 
  • High Growth Earnings: Riyad Bank's earnings are forecast to grow, but not significantly. 
  • Revenue vs Market: Riyad Bank's revenue (9.5% per year) is forecast to grow faster than the Saudi market (1.9% per year). 
  • High Growth Revenue: Riyad Bank's revenue (9.5% per year) is forecast to grow slower than 20% per year. 

Past Performance 

How has Riyad Bank Stock performed over the past 5 years? 

  • Riyad Bank has high-quality earnings. 
  • Riyad Bank's current net profit margins (56.8%) are higher than last year (56.5%). 
  • Riyad Bank's earnings have grown by 13.8% per year over the past 5 years. 
  • Riyad Bank's earnings growth over the past year (20.8%) exceeds its 5-year average (13.8% per year). 
  • “Tadawul: 1010” earnings growth over the past year (20.8%) exceeded the Banks industry 20.4%. 
  • Riyad Bank's Return on Equity (13.6%) is considered low. 

Financial Health  

How is Riyad Bank's financial position?  

  • Riyad Bank's Assets to Equity ratio (6.7x) is low. 
  • Riyad Bank has a sufficient allowance for bad loans (121%). 
  • 92% of Riyad Banks liabilities are made up of primarily low risk sources of funding. 
  • Riyad Bank has an appropriate level of Loans to Assets ratio (68%). 
  • Riyad Bank's Loans to Deposits ratio (86%) is appropriate. 
  • Riyad Bank has an appropriate level of bad loans (1.4%). 

Dividend 

“Tadawul: 1010”, a company that pays dividends, has a current yield of 5.0% that is well covered by earnings. 

  • Riyad Bank's dividend payments have been volatile in the past 10 years. 
  • Riyad Bank's dividend payments have increased over the past 10 years 
  • Riyad Bank's dividend (5.0%) is higher than the bottom 25% of dividend payers in the Saudi market (1.76%). 
  • Riyad Bank's dividend (5.0%) is low compared to the top 25% of dividend payers in the Saudi market (4.64%). 
  • With its reasonably low payout ratio (51.1%), Riyad Bank's dividend payments are well covered by earnings. 
  • Riyad Bank's dividends over 3 years are forecast to be covered by earnings (51.4% payout ratio).

Riyad Bank Stock Price Forecast 

What is the analyst 12-month “Tadawul: 1010” stock price forecast, and do we have any statistical confidence in the consensus price target from analysts? 

“Tadawul: 1010” stock price forecast
Source: simplywall.st 

According to Simplywall.st, the Riyad Bank stock 12-month target price is less than 20% higher than the current share price. 

Wallet investor site suggests that the price of Riyad Bank stock will increase in 2023 compared to the current price, ending the year at an average price of 30.136 SAR. And it reaches 45.244 SAR in 2028.  

Important: When considering Riyad Bank's fundamental analysis, financial rating and price predictions, it’s important to remember that high market volatility and changing economic environment makes it difficult to give long-term estimates. As such, analysts and algorithm-based platforms can and do get their ratings and predictions wrong. Always do your own research before making an investment decision. And never trade or invest more than you can afford to lose. 

Riyad Bank Stock - Technical Analysis  

Riyad Bank stock is currently within a descending corrective channel, counter to the uptrend that commenced in May 2022, as depicted in the weekly chart below.

Riyad Bank Stock - Technical Analysis 

Following the breach of the 100-day closing moving average, it appears that the correction, in accordance with Fibonacci levels, could aim for the 0.618 level, situated near the support level at 25.00 Saudi riyals. Nevertheless, should the price remain above this level, it could bolster the bullish sentiment, potentially targeting the resistance levels at 28.50 and 32.00 Saudi riyals, respectively.

The Fibonacci tool is a good tool that helps day and swing traders to choose entry and exit points, but this tool should not be used in isolation from other technical analysis tools! 

How to Invest in Riyad Bank Stock (Tadawul: 1010) 

Some investors want to take an active hand in managing their investments, while others prefer to set it and forget it. Your preference may change but decide on an approach to get started. 

For most people, stock market investing means choosing among these two investment types: 

Individual Tadawul: 1010 shares  

If you’re after a specific company, you can buy a single share or a few shares to dip your toe into the stock-trading waters. Building a diversified portfolio out of many individual stocks is possible, but it takes significant investment and research. 

If you go this route, remember that individual stocks will have ups and downs. If you research a company and choose to invest in it, think about why you picked that company in the first place if jitters start to set in on a down day. 

Traditional stockbrokers allow you to invest in local stocks. However, you might not be able to invest in international stocks listed on the major stock exchanges, global ETFs, and other assets. 

ETFs with Tadawul: 1010 holdings 

Riyad Bank stock (or any single stock, for that matter) can be a very volatile investment. You can manage the risk you see extreme highs and lows by diversifying your investment holdings. An ETF, for instance, contains a basket of individual stocks. When you invest in a fund, you also own small pieces of each of those companies. 

If you want an ETF with Tadawul: 1010 representation, you might consider iShares MSCI Saudi Arabia ETF. BlackRock's iShares is the largest provider of ETFs as calculated by assets under management. 

ETFs with STC holdings
 

The fund can be suitable for Arab and foreign investors who want liquid and diversified exposure to the top 10 companies listed on the Saudi Stock Exchange:

Al Rajhi BankAlAhli Bank
Aramco - Saudi Arabian OilSaudi Arabian Mining
SABICSaudi Telecom
Riyad BankAlinma Bank
Saudi ElectricityBank Albilad

Why invest in Riyad Bank Stock via KSA? 

The iShares MSCI Saudi Arabia ETF seeks to track the investment results of a broad-based index composed of Saudi Arabian equities. With net assets of almost $1B, The iShares MSCI Saudi Arabia ETF (KSA) is the largest exchange-traded fund that seeks to track the investment results of an index composed primarily of frontier market equities along with select emerging market equities.

  1. Access to the Saudi Arabian stock market, which has historically been closed to foreign investors. 
  2. Targeted exposure to a country with growth potential. with One click accesses to a virtually untapped investment portfolio, including Saudi Stock Exchange and TASI index exposure. 
  3. Use to seek long-term growth and diversification. 

How to Get Started with CAPEX.com 

Here is how to buy and trade stocks, ETFs and other assets with an international, highly regulated broker like CAPEX.com: 

  • Choose which type of account you want to use. Your first concern should be your risk appetite and time horizon. If you want to buy and hold shares, open an Invest account. If you want to speculate on price movements (including falling prices) with zero commission and leverage, open a CFD trading account. 
  • Create an account. Regardless of your chosen account, you need to register and complete the KYC process to verify your identity. 
  • Fund your account with fiat money. Before buying and trading stocks and ETFs, you need to fund your exchange account with U.S. dollars, Euros, or other currencies. 
  • Place your order. Click on the "Search" icon located in the left panel or by clicking on "ETFs" and then select the instrument, such as "iShares MSCI Frontier and Select EM ETF”.

    

When trading stocks, the CFDs (contracts for difference) are stored in your account and are more liquid than the underlying asset.  

However, you should be aware that CFD trading is fast-moving and requires close monitoring. As a result, traders should be aware of the significant risks when trading CFDs. There are margins you need to maintain; if you cannot cover reductions in values, your position might be closed, and you'll have to meet the loss no matter what subsequently happens to the underlying asset. 

With CAPEX, you can trade CFDs on +2.000 stocks and invest in +5.000 stocks and ETFs with ownership. 

Free trading tools and resource

Before you start investing in shares, you should consider using the educational resources we offer like CAPEX Academy or a demo trading account. CAPEX Academy has lots of free trading courses for you to choose from, and they all tackle a different financial concept or process – like the basics of analyses – to help you to become a more informed trader. 

Our demo account is a great place for you to learn more about leveraged trading, and you’ll be able to get an intimate understanding of how CFDs work – as well as what it’s like to trade with leverage – before risking real capital. For this reason, a demo account with us is a great tool for investors who are looking to make a transition to leveraged trading. 

Sources:  

Who We Are | Riyad Bank 

Riyad Bank (SASE:1010) Stock Valuation - Simply Wall St 

Riyad Bank (1010.SR) Stock Price, News, Quote & History - Yahoo Finance 

Riyad Bank Stock Forecast: 1010 Stock Price Prediction, Long-Term; Short-Term Share Revenue -  Walletinvestor 

FAQs about Riyad Bank Shares

disclaimers_academy

course_share_title

article_rating_title

awful
ok
great
awesome

read_more

Cristian Cochintu
Cristian Cochintu
financial_writer

Cristian Cochintu writes about trading and investing for CAPEX.com. Cristian has more than 15 years of brokerage, freelance, and in-house experience writing for financial institutions and coaching financial writers.