Riyad Capital Tweaks Al Rajhi Bank Price Target After Q3 Earnings

05:52 AM EDT, 10/22/2026 (MT Newswires) -- Riyad Capital updated its price target for Al Rajhi Bank (SASE:1120) as it took note of the lender's third-quarter results. For the three-month period, the bank reported a 12% annual increase in net income to 7.11 billion Saudi riyals, which was "broadly in-line" with Riyad Capital's estimate of 6.91 billion riyals, according to a Wednesday first-look note. Total operating income for the quarter was also up 12% year over year to 11.11 billion riyals, against the research firm's forecast of 11 billion riyals. "Al Rajhi Bank trades at approximately 2.5x 2027E P/BV (vs. the sector average of around 1.2x), with its premium supported by superior profitability and operating efficiency. However, the monetary policy outlook remains a key consideration, as a higher-for-longer rate environment could pressure funding costs and limit balance- sheet flexibility given the bank's fixed-rate retail exposure. The securitization of SAR 14.8 bin during 9M26, together with the increasing focus on corporate and SME financing, could help rebalance the portfolio toward faster-repricing assets and partially mitigate these pressures. Accordingly, we trim our target price to SAR 72.00 from SAR 76.67, while maintaining our Buy recommendation," analysts said.