Itqan Capital starts SADAFCO coverage with ‘Overweight’

Itqan Capital has initiated coverage of Saudia Dairy and Foodstuff Co. (SADAFCO) with an “overweight” rating on the stock and a target price of SAR 129.70 per share, the investment company said in a report.

SADAFCO’s most important growth drivers include the improved logistics and supply chain, thanks to its new central warehouse, and its ongoing efforts to strengthen its market presence, the report said.

Challenges, however, include the market situation, as well as the company’s reliance on long-term milk sales.

Itqan Capital forecasts improved earnings for SADAFCO, as economic challenges wane.