Arabian Internet and Communications Services Co CSJC
SAU:7202
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Intrinsic Value
The intrinsic value of one Arabian Internet and Communications Services Co CSJC stock under the Base Case scenario is 258.3 SAR. Compared to the current market price of 286.8 SAR, Arabian Internet and Communications Services Co CSJC is Overvalued by 10%.
The Intrinsic Value is calculated as the average of DCF and Relative values:
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Arabian Internet and Communications Services Co CSJC
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Fundamental Analysis
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Arabian Internet and Communications Services Co. CSJC, often referred to as Internet Solutions, stands as a prominent player in the burgeoning digital landscape of the Middle East. Founded with the vision to transform the regional telecommunications sector, the company has steadily evolved to become a leading provider of internet and communication services across Saudi Arabia and the surrounding region. With a robust infrastructure that includes cutting-edge data centers and a broad fiber-optic network, Internet Solutions is well-positioned to capitalize on the rapid digital transformation occurring in the area. The company's commitment to innovation and customer-centric solutions has establ...
Arabian Internet and Communications Services Co. CSJC, often referred to as Internet Solutions, stands as a prominent player in the burgeoning digital landscape of the Middle East. Founded with the vision to transform the regional telecommunications sector, the company has steadily evolved to become a leading provider of internet and communication services across Saudi Arabia and the surrounding region. With a robust infrastructure that includes cutting-edge data centers and a broad fiber-optic network, Internet Solutions is well-positioned to capitalize on the rapid digital transformation occurring in the area. The company's commitment to innovation and customer-centric solutions has established it as a trusted partner for businesses and individuals alike, bridging the digital divide and enabling seamless connectivity for its diverse clientele.
As investors seek opportunities in the telecommunication sector, Arabian Internet and Communications Services Co. CSJC offers a compelling proposition through its strategic initiatives aimed at expanding market reach and enhancing service offerings. With the growing demand for high-speed internet and cloud services driven by the increasing reliance on digital platforms, the company is poised for substantial growth. Furthermore, its proactive approach to embracing emerging technologies—such as 5G networks and IoT solutions—demonstrates a forward-thinking mindset that aligns with global trends. As Middle Eastern economies continue to diversify and invest heavily in digital infrastructure, Internet Solutions stands ready to seize these opportunities, positioning itself as a key player in the region's vibrant telecommunications market and offering investors an attractive avenue for growth.
Arabian Internet and Communications Services Company (AIS) is primarily known by its brand STC (Saudi Telecom Company) in Saudi Arabia. The core business segments of AIS typically include:
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Telecommunications Services: This is the backbone of the business and includes mobile, fixed-line, and broadband services. They offer various plans catering to individual, business, and government customers.
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Data Services: AIS provides data communication services, including internet access, managed services, and hosting services, which are essential for businesses and individuals relying on connectivity.
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Digital Solutions: This segment encompasses a range of ICT (Information and Communications Technology) services, including cloud services, cybersecurity, IoT (Internet of Things) solutions, and digital transformation services for various sectors.
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Media and Entertainment: The company may also engage in media services, including content delivery and partnerships with streaming platforms, enhancing customer experience through entertainment solutions.
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Enterprise Services: AIS offers tailored solutions for businesses, including local and international calling, private networking, and data center services.
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Smart City Solutions: In alignment with national initiatives like Vision 2030, AIS is involved in providing smart city solutions, integrating telecommunications with urban management technologies.
These segments allow AIS to cater to a broad array of customers, from individual users to corporations and government entities, placing it as a key player in the digital transformation landscape in Saudi Arabia.
To analyze the unique competitive advantages of Arabian Internet and Communications Services Co (also known as Internet & Communications Services Company or Solutions by STC), we should consider several factors that typically lead to an edge in the telecommunications and internet services industry. Here are some potential advantages that may be relevant:
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Strong Brand Presence: As a subsidiary of STC Group, one of the largest telecom companies in the region, Solutions by STC benefits from an established brand reputation and trust among consumers and businesses.
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Comprehensive Service Offerings: The company provides a wide range of internet and communication services, including broadband, fiber optics, and various subscription models. This diversification can meet varied customer needs more effectively than competitors with narrower offerings.
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Infrastructure Investment: Significant investments in network infrastructure can lead to more reliable service and faster internet speeds. If Solutions by STC has invested heavily in cutting-edge technologies, it could offer superior service quality compared to rivals.
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Technological Innovations: Embracing new technologies like 5G, IoT (Internet of Things), and cloud services can differentiate Solutions by STC by offering advanced solutions that align with the latest market trends.
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Customer Support and Relationship Management: A strong customer service framework, coupled with effective account management for business clients, can lead to higher customer satisfaction and loyalty compared to competitors who may not prioritize these areas as much.
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Strategic Partnerships and Alliances: Collaborations with other tech companies or service providers can expand service offerings or enhance market reach, giving Solutions by STC a competitive edge.
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Regulatory Relationships: Navigating local regulations and maintaining good relationships with governmental bodies can enhance operational efficiency and market positioning.
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Tailored Solutions for Businesses: Offering personalized corporate solutions can target the lucrative B2B market effectively, especially in rapidly digitizing sectors.
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Market Knowledge and Local Expertise: Understanding the local market dynamics, customer preferences, and cultural aspects can help Solutions by STC tailor its offerings more effectively than international competitors.
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Cost Structure Efficiency: If Solutions by STC operates with a leaner cost structure or enjoys economies of scale, this could translate into more competitive pricing strategies.
These advantages can create a sustainable competitive edge, allowing Solutions by STC to differentiate itself in the highly competitive telecommunications market. For a more detailed and specific analysis, examining financial reports, market strategies, and recent customer feedback would provide deeper insights into the company's positioning against its rivals.
Arabian Internet and Communications Services Co. (also known as Solutions by stc) operates in a dynamic and competitive sector that faces various risks and challenges. Here are several key risks and challenges that the company may encounter in the near future:
1. Regulatory Changes
- Telecommunications Regulations: Changes in regulations can impact operational flexibility. Compliance requirements can increase operational costs.
- Data Protection Laws: With increasing concerns about data privacy, compliance with regulations like GDPR (if applicable) may require significant investments.
2. Technological Advancements
- Rapid Innovation: The fast pace of technological change (e.g., 5G, IoT, AI) requires continuous investment in research and development.
- Cybersecurity Threats: As digital services grow, so does the risk of cyberattacks, necessitating robust security measures.
3. Market Competition
- Intense Competition: The telecom sector is characterized by high competition, particularly from both local and regional players, which could pressure pricing and margins.
- New Entrants: The emergence of new competitors, including OTT (over-the-top) service providers, may disrupt traditional business models.
4. Economic Factors
- Macroeconomic Conditions: Global and regional economic downturns can affect consumer spending and demand for services.
- Currency Fluctuations: For companies operating in different currencies, unfavorable exchange rate movements can impact financial performance.
5. Customer Expectations
- Changing Consumer Behavior: As customers demand more personalized and efficient services, the company must adapt quickly to changing preferences.
- Service Quality: Maintaining high service quality and customer satisfaction is essential but challenging in a competitive environment.
6. Supply Chain Disruptions
- Supplier Dependency: Reliance on key technology suppliers can lead to vulnerabilities if there are supply chain disruptions.
- Global Supply Issues: Geopolitical tensions or global supply chain issues can affect the availability and cost of necessary technology.
7. Human Resource Challenges
- Talent Acquisition and Retention: The need for skilled labor in technology and communications is high, making it challenging to attract and retain talent.
- Employee Adaptation: Ensuring staff can adapt to new technologies and systems will be critical for innovation.
8. Strategic Execution
- Effective Strategy Implementation: Executing strategic initiatives, such as entering new markets or launching new services, can present operational challenges.
- Partnerships and Alliances: Building and maintaining partnerships with tech firms and other service providers can be crucial but may also pose risks if not managed properly.
Conclusion
Addressing these risks and challenges will require strong strategic planning, continuous market analysis, and proactive management to adapt to the rapidly changing telecommunications landscape. Solutions by stc must also focus on innovation, customer engagement, and operational efficiencies to stay ahead in the competitive environment.
Revenue & Expenses Breakdown
Arabian Internet and Communications Services Co CSJC
Balance Sheet Decomposition
Arabian Internet and Communications Services Co CSJC
Current Assets | 8.7B |
Cash & Short-Term Investments | 1.9B |
Receivables | 6.2B |
Other Current Assets | 612m |
Non-Current Assets | 1.5B |
Long-Term Investments | 466.5m |
PP&E | 398.3m |
Intangibles | 579m |
Other Non-Current Assets | 46.1m |
Current Liabilities | 5.7B |
Accounts Payable | 2.9B |
Short-Term Debt | 62.8m |
Other Current Liabilities | 2.7B |
Non-Current Liabilities | 1.3B |
Long-Term Debt | 702.3m |
Other Non-Current Liabilities | 553.4m |
Earnings Waterfall
Arabian Internet and Communications Services Co CSJC
Revenue
|
11.2B
SAR
|
Cost of Revenue
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-8.7B
SAR
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Gross Profit
|
2.6B
SAR
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Operating Expenses
|
-1.2B
SAR
|
Operating Income
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1.4B
SAR
|
Other Expenses
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-57.6m
SAR
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Net Income
|
1.4B
SAR
|
Free Cash Flow Analysis
Arabian Internet and Communications Services Co CSJC
SAR | |
Free Cash Flow | SAR |
Profitability Score
Profitability Due Diligence
Arabian Internet and Communications Services Co CSJC's profitability score is 70/100. The higher the profitability score, the more profitable the company is.
Score
Arabian Internet and Communications Services Co CSJC's profitability score is 70/100. The higher the profitability score, the more profitable the company is.
Solvency Score
Solvency Due Diligence
Arabian Internet and Communications Services Co CSJC's solvency score is 71/100. The higher the solvency score, the more solvent the company is.
Score
Arabian Internet and Communications Services Co CSJC's solvency score is 71/100. The higher the solvency score, the more solvent the company is.
Wall St
Price Targets
Price Targets Summary
Arabian Internet and Communications Services Co CSJC
According to Wall Street analysts, the average 1-year price target for Arabian Internet and Communications Services Co CSJC is 322.56 SAR with a low forecast of 249.47 SAR and a high forecast of 414.75 SAR.
Dividends
Current shareholder yield for Arabian Internet and Communications Services Co CSJC is .
Shareholder yield represents the total return a company provides to its shareholders, calculated as the sum of dividend yield, buyback yield, and debt paydown yield. What is shareholder yield?
Profile
Country
Industry
Market Cap
Dividend Yield
Description
Arabian Internet & Communications Services Co. engages in the provision of information technology consulting and systems integration services. The company is headquartered in Riyadh, Riyadh. The company went IPO on 2021-09-30. The firm has three segments which include Core ICT Services, Information Technology (IT) Managed and Operational Services and Digital Services. Core ICT Services are core requirements of the businesses, enabling customers to have core IT requirements with systems, hardware/software, and connectivity to the Internet including system integration and communication and Internet services. IT Managed and Operational Services are considered as add on(s) and help the customers in managing their operations and improve the total cost of ownership, including outsourcing and managed services. Digital Services are advance digital services utilized by customers to further enhance and scale their offerings including cloud, cyber security and digital Services.
Officers
The intrinsic value of one Arabian Internet and Communications Services Co CSJC stock under the Base Case scenario is 258.3 SAR.
Compared to the current market price of 286.8 SAR, Arabian Internet and Communications Services Co CSJC is Overvalued by 10%.