Al Rajhi Cap says Leejam's Q1 2021 beats estimates, revises rating to ‘Neutral’

27/04/2021 Argaam

Leejam Sports Co. headquarters


Leejam Sports Co.'s (Fitness Time) Q1 2021 loss of SAR 7 million came below Al Rajhi Capital's estimates of SAR 11 million.

 

The increase in COVID-19 infections may lead to the decline in the number of new subscribers, which will likely impact the stock's earnings per share (EPS) in 2021, the research firm said in a recent report.

 

Al Rajhi Capital stated that it is still optimistic on the long-term story of Leejam, due to the launch of the low-cost Xpress fitness centers, which would help improve returns.

 

However, the brokerage lowered Leejam’s rating to “Neutral”, reducing the target price to SAR 76 a share.

 

According to the report, the downgrade risks are potential lockdown due to the increase in COVID-19 cases, which would impact the company's revenues, in addition to the fierce competition for the fitness applications and other clubs in the region.

Comments {{getCommentCount()}}

Be the first to comment

loader Train
Sorry: the validity period has ended to comment on this news
Opinions expressed in the comments section do not reflect the views of Argaam. Abusive comments of any kind will be removed. Political or religious commentary will not be tolerated.