Dar Al Arkan Real Estate Development Co. (ALARKAN) dropped the most in almost six months after fourth-quarter earnings missed analysts’ estimates.
The shares slumped 6.1 percent, the most since July 11, to 8.5 riyals at the 3:30 p.m. close in Riyadh. The stock was the biggest decline on the Tadawul All Share Index today.
Quarterly profit (ALARKAN:US) at Dar Al Arkan, the biggest publicly traded Saudi property company by assets, dropped to 144 million riyals ($38 million) from 290 million riyals due to lower margins on property sales, the Riyadh-based company said in a statement to the Saudi stock market. The mean estimate of five analysts was for a profit of 252 million riyals, according to data compiled by Bloomberg.
“We are slightly concerned about the dent in the gross margin, which we can only attribute to a decline in profitability of quarterly land sales,” said Jan Pawel Hasman, a real-estate analyst at EFG-Hermes Asset Management. “The bottom-line weakness might have been additionally caused by increased depreciation charges driven by the newly launched investment properties, as well as increased marketing and financing costs.”
Four analysts (ALARKAN:US) have a buy rating on the stock, while three recommend investors hold the shares, according to data compiled by Bloomberg.
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