Revenue matches Bloomberg consensus, exceeds our estimate
Dallah Healthcare’s revenue in 3Q24 grew 13% YoY, coming in line with Bloomberg consensus but ahead of our estimate. Revenue growth was driven by an increase in operational capacity, which drove patients at the Group’s hospitals higher.
Operating and net profit expand at a faster pace than revenue
Operating profit increased at a relatively higher clip than revenue in 3Q24, indicating improved efficiency. Dallah also recorded a higher share of profit from associates (SAR 7mn vs. SAR 3mn in 3Q23), which boosted net income by 28% YoY, coming in line with Bloomberg consensus but better than our expectations.
Maintain target price
Dallah’s latest financial performance shows its focus on profitable growth, in our view, and hence we maintain our SAR 183 target price on it. The company’s BoD announced SAR 0.5 DPS for 3Q24, in line with our estimate, offering a 1.5% yield on the TTM basis. Currently, the stock trades at 29.3x FY25e EPS, below its 3-year daily average forward P/E of 33.9x.