Solutions (7202.SE): Model update post 2Q26; TP to SAR230

Research evidence excerpt

Solutions (7202.SE): Model update post 2Q26; TP to SAR230

Action |

03 Aug 2026 11:48:25 ET │ 14 pages

Solutions (7202.SE)

Model update post 2Q26; TP to SAR230

CITI'S TAKE

Neutral Updating estimates post stronger-than-expected 2Q26. While 1H26

revenue growth of +9% YoY and EBITDA margin of 17.4% are ahead of Price (03 Aug 26 15:00) SAR219.30

FY26 guidance (6-8% growth, 14-16% margin), management maintained Target price SAR230.00↑

its outlook. On the call, management highlighted that part of the stronger from SAR220.00

1H26 performance reflected efforts to accelerate project delivery and Expected share price return 4.9%

monetization into the first half of the year to improve resource utilization Expected dividend yield 4.1%

and reduce reliance on a concentrated year-end delivery profile, rather

Expected total return 9.0% than a change in FY26 revenue expectations. Nevertheless, management

Market Cap SAR26,316M reiterated confidence in achieving FY26 targets, supported by healthy

backlog visibility (SAR14.5bn) and a solid pipeline of recently awarded US$7,007M

projects (e.g. STC contract, National Water Company). Following the

results, we modestly raise our estimates to reflect stronger 1H26

execution and backlog conversion. While growth momentum remains

Maxim NekrasovAC

healthy, management's comments suggest limited scope for a near-term +44-20-7500-7264

guidance upgrade. TP moves to SAR230 from SAR220 (implying ~15x maxim.nekrasov@citi.com

2027E P/E); remain Neutral.

Valuation and TP change — We raise our revenue/EBITDA/EPS estimates by

1%/2.5%/2% in 2026E, reflecting stronger backlog monetization and slightly better

margin assumptions. Our TP increases to SAR230 from SAR220 (+5%), as we

slightly increase our target 2027E P/E to 15x from 14x on the back of a better