Middle East Small Caps Including Saudi Reinsurance with Promising Potential

Simply Wall St · 07/02 03:02

Amidst a backdrop of cautious investor sentiment and profit-taking in the Gulf markets, small-cap stocks in the Middle East have been navigating a challenging landscape as regional indices experience fluctuations. In this environment, identifying promising small-cap stocks requires careful consideration of their resilience to market volatility and potential for growth within sectors poised to benefit from economic shifts.

Top 10 Undiscovered Gems With Strong Fundamentals In The Middle East

Name Debt To Equity Revenue Growth Earnings Growth Health Rating
Baazeem Trading 8.48% -2.02% -2.70% ★★★★★★
Terminal X Online 17.70% 12.39% 35.35% ★★★★★★
Alf Meem Yaa for Medical Supplies and Equipment NA 17.03% 18.37% ★★★★★★
MOBI Industry 6.50% 5.60% 24.00% ★★★★★★
Sure Global Tech NA 11.95% 18.65% ★★★★★★
Saudi Azm for Communication and Information Technology 2.07% 16.18% 21.11% ★★★★★★
Nofoth Food Products NA 15.75% 27.63% ★★★★★★
National General Insurance (P.J.S.C.) NA 14.55% 29.05% ★★★★★☆
National Corporation for Tourism and Hotels 19.25% 0.67% 4.89% ★★★★☆☆
Saudi Chemical Holding 79.49% 16.57% 44.01% ★★★★☆☆

Click here to see the full list of 218 stocks from our Middle Eastern Undiscovered Gems With Strong Fundamentals screener.

Here's a peek at a few of the choices from the screener.

Saudi Reinsurance (SASE:8200)

Simply Wall St Value Rating: ★★★★☆☆

Overview: Saudi Reinsurance Company offers a range of reinsurance products across Saudi Arabia, the Middle East, Africa, Asia, and globally with a market capitalization of SAR 5.89 billion.

Operations: The company's primary revenue streams are derived from its Property and Casualty segment, contributing SAR 1.16 billion, and Life and Health segment at SAR 47.11 million. It also benefits from unallocated investment income calculated using the effective interest rate amounting to SAR 76.78 million.

Saudi Reinsurance, a relatively small player in the insurance sector, has shown notable financial resilience. Its earnings surged by 229.9% over the past year, significantly outpacing the industry average of -16.7%. The company's debt-to-equity ratio climbed to 2.7% from 0% over five years, indicating increased leverage but manageable levels given its cash position exceeding total debt. Despite shareholder dilution last year, Saudi Re's price-to-earnings ratio of 12.3x suggests it trades at a favorable value compared to the broader SA market's 21.5x benchmark. Recent board appointments could also signal strategic shifts aimed at sustaining growth momentum.

SASE:8200 Debt to Equity as at Jul 2025
SASE:8200 Debt to Equity as at Jul 2025

Gold Bond Group (TASE:GOLD)

Simply Wall St Value Rating: ★★★★★☆

Overview: The Gold Bond Group Ltd. provides storage, conveyance, and logistical solutions for cargoes and containers, with a market cap of ₪879.98 million.

Operations: Gold Bond Group generates revenue primarily from Free Activities (₪87.01 million), FCL Terminal Operations (₪57.60 million), LCL Terminal Operations (₪49.63 million), and Ecommerce Activity (₪13.65 million).

Gold Bond Group's recent performance showcases a promising trajectory. Over the past year, earnings surged by 24.9%, outpacing the Infrastructure industry's growth of 9.6%. Despite a historical annual decline of 5.2% over five years, their debt to equity ratio impressively shrank from 15.3% to just 3%. The company reported first-quarter sales of ILS 57.87 million, up from ILS 43.29 million the previous year, with net income climbing to ILS 7.44 million from ILS 6.66 million and basic earnings per share rising to ILS 1.85 from ILS 1.65, indicating strong financial health and operational efficiency in recent quarters.

TASE:GOLD Debt to Equity as at Jul 2025
TASE:GOLD Debt to Equity as at Jul 2025

Neto Malinda Trading (TASE:NTML)

Simply Wall St Value Rating: ★★★★★★

Overview: Neto Malinda Trading Ltd. is engaged in the manufacturing, importing, marketing, and distribution of kosher food products with a market cap of ₪2.77 billion.

Operations: Neto Malinda Trading generates revenue through three primary segments: Import (₪2.02 billion), Local Market (₪2.19 billion), and Neto Group Factories (₪0.75 billion).

Neto Malinda Trading, a promising player in the Middle East market, has shown robust financial health with high-quality earnings and a price-to-earnings ratio of 12.2x, undercutting the IL market average of 15.7x. The company's interest payments are comfortably covered by EBIT at 33.6x, indicating strong operational efficiency. Over the past year, earnings surged by 137%, significantly outpacing the food industry’s growth rate of 91.8%. Recent financial results highlight a rise in sales to ILS 1.3 billion from ILS 1.14 billion and net income climbing to ILS 53.94 million from ILS 30.38 million year-on-year, reflecting solid performance momentum.

TASE:NTML Earnings and Revenue Growth as at Jul 2025
TASE:NTML Earnings and Revenue Growth as at Jul 2025

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.