Glossary

 

Price
The market price of the share as of the date indicated.

 

 

52 - Week Range
Highest and lowest price per share during the last 52 weeks.

 

 

Volume

The number of shares traded during a given period.

 

 

Market Capitalization

Value of a corporation as determined by the market price of its shares and outstanding common stock. It is calculated as follows:
Share Price at a specific date X Number of outstanding shares.

 

 

Outstanding Shares
The number of outstanding shares.

 

 

Beta
A relative measure of the systematic return of the stock to the overall market. Stocks with Betas greater than 1.0 are highly volatile and have a positive correlation with the market; such stocks are termed aggressive securities. Stocks with Betas less than 1.0 are either more stable than the average or have a low correlation with the market or both (defensive securities). Stocks with a negative Beta move in the direction opposite to that of the market. Examples: Beta (1.5) means the stock moves 50% more than the overall market in the same direction. Beta (0.5) means the stock moves 50% less than the overall market. Beta (-1.0) means the stock tends to move in a direction opposite from the overall market.

 

 

P/E Ratio
This index helps in evaluating the attractiveness of an investment. Last closing price ÷ latest trailing 4-quarter earnings per share.

 

 

Price/Revenue
A measure of how expensive a stock is. Last closing price ÷ latest trailing 4-quarter revenues per share.

 

 

Price /Book Value
The ratio of market price to book value, indicates a growth prospects. Last closing price ÷ latest book value.

 

 

Price/Cash Flow
A common measure of operating cash flow to share price. Last closing price ÷ latest trailing 4-quarter cash flow per share.

 

 

Dividend Yield
The current return to shareholders from dividends received over a specific period. ( Dividends ÷ Closing price ) X 100

 

 

Operating Income (Banks )
A measure of a company's earning power from ongoing operations. Equals to earning before deduction of interest payments and zakat or income tax.

 

 

Gen. & Admin. Expenses
Costs of operating a business and incurred to generate revenues. Computed as follows: Staff salaries & allowances + Gen. and Admin. Expenses + Sales and Marketing expenses.

 

 

Sales/Revenues
Inflows of an entity from delivering or producing goods, rendering services or other activities that constitute the entity's ongoing major or central operations.

 

 

Prov. For Doubtful Debts (Banks)
These are amounts included in operating expenses to form sufficient reserves to cover expected losses in loans portfolio.

 

 

Total Operating Expenses (Banks)
Costs associated with the selling and administrative expenses of the bank.

 

 

Depreciation
Depreciation of fixed assets such as plant and equipment so as to allocate the cost over their depreciable life.

 

 

Net Profit
Final profit before distribution of dividends.

 

 

Cash & balances with banks

Represents cash in hand, balances with banks, Saudi Arabian Monetary Agency; SAMA's reserve (for banks) and amounts under collection.

 

 

Loans (Banks)
Represents commercial, industrial, financial, agricultural and lease loans.

 

 

Investments
Represents bonds, securities, investment funds and stocks.

 

 

Total Assets
Represents current assets + stocks + investments + fixed assets + other assets. Banks represent total assets of the banks as indicated in the yearly or quarterly balance sheet.

 

 

Due to Banks (Banks)
Represents total balances due to local and foreign banks.

 

 

Total Liabilities
These are amounts due to all categories of creditors.

 

 

Capital
Represents the value of shares as authorized in articles of Association (issued and subscribed).

 

 

General Reserves (Banks)
Represents a special reserve, which is formed in accordance with the bank's rules and regulations.

 

 

Owner's Equity
Represents resources invested by shareholders such as paid-up capital, reserves and retained profits.

 

 

Deposits (Banks)
Represent customer’s deposits with banks, which may be time deposits, call deposit or current accounts.

 

 

Return on Assets %
Represents the percentage of net profits to the total assets. It is an analytical measure of the effective use of assets and is computed as follows: (Net profit ÷ Total assets) X 100.

 

 

Return on Equity %
Represents the percentage of net profits to the owner's equity. It indicates return of profit on the amount invested by the shareholders. Computed as follows: (Net profit ÷ Owner's equity) X 100.

 

 

Loans / Deposits % (Banks)
Refers to percentage of loans financed by deposits. It is a measure of liquidity and indicates bank's ability to give additional loans. Calculated as follows: (Loans ÷ Customers deposits) X 100.

 

 

Net Profit Margin
Represents the percentage of net profits to sales revenues. Calculated as follows: (Net profit ÷ Sales revenue) X 100.

 

 

Revenue/Employee
It indicates revenue per employee. Revenue ÷ Number of employees.

 

 

Income/Employee
It indicates income per employee. Net profit ÷ Number of employees.

 

 

Book Value
Indicates the value of one share of the net assets. Calculated as follows: Owner's equity ÷ Number of outstanding shares.

 

 

Earning Per Share (EPS)
This indicator measures the profitability strength of one share and is used by investors to evaluate the company's previous performance and in forecasting future profits and investment opportunities. Computed as follows: Net Profit after Zakat & Taxes ÷ Number of outstanding shares.

 

 

Cash Flow (Per Share)
It reports on the cash generating ability of the firm. Calculated as follows: (Net profit + amounts charged off for depreciation, depletion and amortization) ÷ Outstanding shares.

 

 

Dividends (Per Share)
Amount allotted to one share from the profits distributed for a period of twelve months. Calculated as follows: Distributed profits ÷ Number of outstanding shares.

 

 

Payout ratio (%)
Indicates the percentage of profits distributed by the company among shareholders, out of the net profits. Computed as follows: (Dividend ÷ Earning per share) X 100.

 

 

Market Price - High/Low
Shows the high and low price of the share traded during the year.

 

 

P/E Ratio (High/Low)
This index helps in evaluating the attractiveness of an investment. Highest and Lowest price of a share during one fiscal year ÷ Earning per share.

 

 

Price/Book Ratio (High/Low)
The ratio of market price to the book value indicates a company's growth prospects. Highest and Lowest price of a share during one fiscal year ÷ Book value.

 

 

Price/Revenue Ratio (High/Low)
A measure of how expensive a stock is. Highest and Lowest price of a share during one fiscal year ÷ Revenue per share.

 

 

Price/Cash Flow (high/Low)
A common measure of operating cash flow to share price. Highest and Lowest price of a share during one fiscal year ÷ Cash flow per share.

 

 

Gross Income (Banks)
Represents revenue from banking services rendered to customers, and money lending and other financial services.

 

 

Pre-Zakat Profit
Represents amount remaining from sales/revenues after deducting costs of goods/services and expenses. Calculated as follows: Total revenues - Total expenses.

 

 

Total Dividends (Banks)
Total amount distributed to shareholders as dividends for the year.

 

 

Statutory Reserve (Banks)
Represents, under Saudi Banking control law, the transfer of at least 25% of the yearly net income to the statutory reserve until it becomes equal to the paid up capital.

 

 

Cash Flow from Operating Activities
Reports the cash generated from sales and the cash used in the production process. These items essentially flow through the firm's income statement and working capital accounts.

 

 

Cash Flow from Investment Activities
Cash flows associated with the buying and selling of fixed assets and business interests.

 

 

Cash Flow from Financing Activities
Cash flows generated through debt and equity financing.

 

 

Increase (Decrease) in Cash
Difference between the cash flows.

 

 

Cash Flow
A measure of a company's financial health. Equals net profit + amounts charged off for depreciation, depletion and amortization.

 

 

Gross Profit
Represents sales revenue less cost of sales before deduction of administrative and marketing expenses. Calculated as follows: Sales revenues - Cost of sales.

 

 

Current Assets
Represents cash and any other assets that can be converted into cash with in an operating cycle of a business, usually one year or more than one year for projects with a long operation cycle.

 

 

Current Liabilities
Debts and other obligations coming due within a year.

 

 

Long-term Debts
Represents liabilities which are payable over a relatively long period, usually more than one year.

 

 

Gross Profit Margin (%)
Represents the percentage of total gross profit to sales revenues. Calculated as follows: (Gross profit ÷ Sales revenue) X 100.

 

 

Current Ratio
A measure of financial liquidity for a company used in estimating the ability of the firm to fulfill its obligations in the medium or short-term period. Computed as follows: Current assets ÷ Current liabilities.

 

 

Leverage (%)
This refers to the percentage of debts to shareholders' equity. Higher ratio indicates high indebtedness. Computed as follows: (Total Liabilities ÷ Shareholder's equity) X 100.

 

 

Borrowing (%)
Higher ratio may indicate expansion in business. Calculated as follows: (Long-term loans ÷ Total assets) X 100.

 

 

Owner's Equity / Assets (%)
Represents total owner's equity to total assets ratio and it is used to measure efficiency of capital use. Calculated as follows: (Total Owner's Equity ÷ Total Assets) x 100.

 

 

Due from Foreign Banks (Banks)
Represents balances with foreign banks.

 

 

Reserves
Includes Statutory, general and other reserves.

 

 

Clarifications

 

 

Stock-Split
An increase in a company's number of outstanding shares of stock without any change in the value of shareholders' equity. Companies authorize a split to make ownership more affordable to a broader base of investors. A split of 2 -for- 1 means giving two shares and returning one.
ll current and historical prices are adjusted to reflect stock splits and stock dividends. All relevant ratios are adjusted according to the adjustment factor.
Example (stock split):On 31-03-1998 SABIC announced a 2 -for- 1 stock split (company decreased the par value per share from SR 100 to SR 50). The last closing price before the split was SR 369. The price dropped to SR 176 following the split. (Adjustment factor 0.5)

 

 

Private sector
Consists of Saudi nationals and may involve investors from other Gulf Cooperation Council Countries (GCC).

 

 

Saudi Industrial Development Fund (SIDF)
A government entity, which provides interest free, loans to non-oil private manufacturers.

 

 

Zakat
A religious levy on Saudi nationals and companies wholly owned by Saudi nationals. The rate of Zakat is 2.5% of capital employed, not invested in fixed assets, long-term investments and deferred costs, as adjusted by net results of operations for the year.

 

 

Electricity Sector
Annual distribution of dividends is guaranteed by the government for all SEC branches.

 

 

30-Days Avg:
Volume. Simple average of 30 days volume.

 

 

1-Day Change:
Change in the latest price as compared to the last trading day price.

 

 

1-Week Change:
Change in the latest price as compared to the last one week trading price.

 

 

1-Month Change:
Change in the latest price as compared to the last one month trading price

 

 

3-Month Change:
Change in the latest price as compared to the last three months trading price

 

 

1-Year Change:
Change in the latest price as compared to the last one year trading price

 

 

52-week high:
Highest share price during the last 52 weeks

 

 

52-week low:
Lowest share price during the last 52 weeks

 

 

YTY Change:
Change in the current financial year values as compared to the last financial year values.

 

 

5-Year Growth:
Growth in values in the last five years

 

 

5-Year Average:
Simple average of variables in the last five years.

 

 

Special Commission Income:
Yield on the earnings assets e.g. loans & advances and loans to other banks

 

 

Special Commission Expenses:
Cost of funds e.g. deposits & loan from other banks.

 

 

Net Commission Income:
The difference between Special Commission Income and Special Commission Expenses.

 

 

Other Operating Income:
Income generated from other operations of the business.

 

 

Revenues:
The total revenue generated by the main operations of the business.

 

 

Operating Cost:
The costs incurred to generate the revenues for the business.

 

 

Cost of Sales:
The manufacturing cost of the goods that were sold is designated as cost of sales.

 

 

Other Income:
Are non-operational in nature. This comprises of interest income, dividend revenue, rental revenue and gain/loss from fixed assets disposals etc.

 

 

Other Expenses:
Are non-operational in nature.

 

 

Provisions:
An expense set aside as an allowance for bad loans (customer defaults, or terms of a loan have to be renegotiated, etc).

 

 

Pre-Tax Profit:
The profit recognized before deducting income tax/zakat.

 

 

Inventories:
Inventory can be either raw materials, finished items already available for sale, or goods in the process of being manufactured. Inventory is recorded as an asset on a company's balance sheet.

 

 

Account Receivable:
Money that is owed by customers

 

 

Other Current Assets:
A balance sheet entry used by companies to group together current assets that are not assigned to common current assets such as inventory or accounts receivable.

 

 

Working Capital:
The working capital ratio, which measures the ability to pay back creditors, is calculated as current assets minus current liabilities.

 

 

Other Reserves:
The amounts of funds that companies hold in other reserves arise from retaining the portion of earnings to meet unexpected expenditure in future.

 

 

Equity/Asset %.
This ratio is a way of examining how much a company uses debt to finance its assets.

 

 

Liquid Asset/Total Asset %:
A test that determines a company's ability to cover debt obligations and working capital requirements with its liquid assets.

 

 

Quick Ratio:
A stringent measurement that indicates if a firm has enough short-term assets to cover its immediate liabilities without selling inventory.

 

 

Debt/Equity %:
A measure of a company's financial leverage, it indicates what proportion of equity and debt the company is using to finance its assets.

 

 

Market Capitalization
The market value of a corporation is determined by the market price per share and outstanding common stock. It is calculated as follows: Share price at a specific date multiplied by number ofoutstanding shares.

 

 

EPS
This indicator measures the profitability strength of one share and is used by investors to evaluate the company's previous performance and to forecast future profits and investment opportunities. It is computed as follows: Net profit divided by number of outstanding shares. Currently, for Saudi joint stock companies, it is computed from the company's latest 12 month trailing earnings and for other GC joint stock companies calculated from the latest financial year earnings.

 

 

Book Value
This ratio represents the equity of the firm on a per share basis and is used as a benchmark for comparison with the market price per share. If the stock price is very close to book value or below book value, then stock is a "buy", as downside risk is viewed as negligible. Calculated as follows: Owner's Equity divided by number of outstanding shares. Currently, for Saudi joint stock companies, it is computed from the company's latest Quarter and for other GCC joint stock companies from the latest financial year.

 

 

Price to Earning (P/E)
The PE ratio helps in evaluating the attractiveness of an investment. Currently, for Saudi joint stock companies, it is computed as: last closing price divided by latest 12 month trailing earning per share, for other GCC joint stock companies last closing price-latest financial year earning per share.

 

 

Price to Book
This is used as a bench mark while conducting sector or market analysis. This ratio is one of the indicators to judge the undervalued or overvalued companies. It is computed as: last closing price + latest book value

 

 

Price to Revenue
This ratio is useful for two reasons. First, consistent and strong sales growth is a requirement for a growth company. Second, given all data in the balance sheet and income statement, sales information is subject to less manipulation than any other data item. The relative valuation analysis using the price to revenue ratio should be between firms in the same or similar industries. Currently, for Saudi joint stock companies, it is computed as last closing price ÷ latest 12 month trailing revenue per share and for other GCC companies last closing price ÷ last financial year revenue per share.

 

 

Price to Cash Flow
A measure used to judge a firm's future financial health. This provides an indication of relative valuation, similar to the price-earnings ratio. Currently, for Saudi joint stock companies, it is calculated as: last closing price ÷ latest trailing 12 month cash flow per share, for other GCC companies’ last closing price ÷ latest financial year cash flow per share.

 

 

Beta
A standardized measure of systematic risk based upon a stock's covariance with the market. Stocks with beta greater than 1.0 are highly volatile and have a positive correlation with the market; such stock is termed aggressive securities. Stocks with beta less than 1.0 are either more stable than the average or have a low correlation with the market or both (defensive securities). Stocks with a negative beta move in the opposite direction as relative to market. Examples: Beta -1.5 means that if the stock market goes up by 10% the stock will move in opposite direction by 15%.

 

 

52-week high
The highest price for a stock during the last one year.

 

 

52-week Low
The lowest price for a stock during the last one year.

 

 

Daily Price change (%)
The price change (%) between the current closing price and the previous day's closing price.

 

 

Weekly Price change (%)
The price change (%) between the current closing price and dosing price of last week.

 

 

Monthly Price change (%)
The price change (%) between the current closing price and a month before closing price.

 

 

3 Months Price change (%)
The price change (%) between the current closing price and 3 months before closing price.

 

 

Yearly Price change (%)
The price change (%) between the current closing price and 1 year before closing price.

 

 

12 month EPS growth,
The percentage change in current 12 month trailing EPS vs. one year before 12 month trailing EPS. Currently, this is available for Saudi joint stock companies only.

 

 

5 Yrs EPS growth
The percentage change in earnings per share of a company over a period of 5 years.

 

 

12 month Net Income growth
The percentage change in current 12 month net income vs. last 12 month trailing net income. Currently, this is available for Saudi joint stock companies only.

 

 

5 Yrs Net Income Growths
The percentage change in net income of a company over a period of 5 years.

 

 

12 month revenue growth
The percentage change in current 12 month revenues vs. last 12 month trailing revenues. Currently, this is available for Saudi companies only.

 

 

5 Yrs revenue growth
The percentage change in revenues of a company over a period of 5 years.

 

 

Net Profit margin
It indicates profitability of a company. Very useful when comparing margins within the sector. A higher profit margin indicates a more profitable company. On the other hand, a low profit margin canindicate pricing strategy and/or the impact of competition on margins and etc. Calculated as follows: (net profit ÷ sales revenues) X 100. Currently for Saudi Joint stock companies, it is calculated from the latest 12 month trailing financials and for other GCC companies from the most recent financial year.

 

 

Gross Profit Margin
This ratio represents the percentage of gross profit to sales revenues. Calculated as follows: (gross profit ÷ sales revenues) X 100. Currently, for Saudi joint stock companies, it is calculated from the latest 12 month trailing financials and for other GCC companies on the most recent financial year.

 

 

Return on assets
ROA indicates the efficiency of a company relative to its total assets. This ratio represents the percentage of net profit to total assets. Currently, for Saudi joint stock companies, it is calculated as: (latest 12 month trailing net profit ÷ most recent quarter total asset) X 100 and for other GCC companies as: (latest financial year net profit ÷ total assets) X 100.

 

 

Return on equity
The ROE is useful in comparing the profitability of a company with other firms in the same industry. This ratio indicates the return shareholders generate from the net profits of a company. Currently, for Saudi joint stock companies, it is calculated as: (latest 12 month trailing net profit ÷ most recent quarter total shareholder's equity) X 100 and for other GCC companies as (latest financial year net profit ÷ total shareholder’s equity) X 100.

 

 

Return on assets 5 Yrs average
The average return on assets over a period of 5 years.

 

 

Return on equity 5 Yrs average
The average return on equity over a period of 5 years.

 

 

Latest dividend per share
Amount distributed among the shareholders from the profit for a period of twelve months. Calculated as follows: distributed profits ÷ number of outstanding share.

 

 

Dividend yield
Indicates the profit earned by a shareholder on his investment. The dividend yield plus return on capitals gains is equal to total return. It is calculated as: (dividend per share ÷ closing price) X 100.

 

 

Payout ratio
The payout ratio provides an idea of how well earnings support the dividend payments. The percentage of earnings paid out in dividends. It is calculated as: (dividend per share ÷ earning per share) X100.

 

 

Payout ratio 5 Yrs average
The average payout ratio over a period of 5 years.

 

 

Revenue/Employee
Ideally, a company with the highest revenue per employee possible, as it denotes higher productivity. The ratio describes the efficiency of a company in terms of revenues generated by an employee when conducting industry analysis. It is calculated as follows: Revenue ÷ number of employees.

 

 

Income/Employee
This ratio measures the efficiency of a company in terms of profit per employee and very effective when conducting industry analysis. It indicates net income per employee and is calculated as follows: net income ÷number of employees.

 

 

Current ratio
A measure of financial liquidity of a company used in estimating the ability of a firm to fulfill its obligations in the medium or short-term period. Current Ratio is useful for comparing companies within the same industry. The higher the ratio, the more liquid the company is. It is calculated as follows: current assets ÷ current liabilities. Currently, for Saudi joint stock companies, it is calculated from the most recent quarter" and for other GCC companies from the most recent financial year.

 

 

Quick ratio
The quick ratio is an indicator of a company's financial strength it is also known as acid test ratio. Basically, it is a measure of how quickly a company's assets can be converted into cash. It is calculated by subtracting inventories, stores, and prepaid expenses from current assets, and then dividing by current liabilities. Currently, for Saudi joint stock companies, it is calculated from the most recent quarter and for other GCC companies from the most recent financial year.

 

 

Leverage
This refers to the percentage of debts to shareholders' equity. Higher ratio indicates high indebtedness. It is calculated as: (total liabilities ÷ shareholders' equity) X 100. Currently, for Saudi joint stock companies, it is calculated from the most recent quarter and for other GCC companies from the most recent financial year.

 

 

Debt/equity ratio
A measure of a company's financial leverage and indicates what the proportion of equity and debt the company is using to finance its assets. Higher debt/equity ratio generally means that a company has been aggressive in financing its assets with debt. This can result in volatile earnings as a result of the additional interest expense. It is calculated as: Long-term debts ÷ shareholders' equity) X 100.

 

 

Loan / deposit ratio
Refers to percentage of loans financed by deposits. It is a measure of liquidity and indicates bank's ability to provide additional loans. It is calculated as follows: (loan ÷ customers' deposit) X 100. Currently, for Saudi banks, it is calculated from the most recent quarter and for other GCC companies from the most recent financial year.

 

 

Liquid Assets/Total Asset
Represents current assets that can be converted into cash in a very short period in comparison with total assets. Calculated as follows: (currents assets - inventory and account receivable) ÷ total assets X 100. It is one of the measures used in determining permissible investment according to Islamic Shari'ah.

 

 

Revenues
Amount of sales, including discounts, returned merchandise and taxes. It is the "top line" figures from which expenses are subtracted to determine net income. Currently, for Saudi joint companies, it is available for the latest 12 month trailing revenue and for other GCC companies from the most recent financial year.

 

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