JPMorgan initiates coverage of Saudi Aramco with ‘overweight’ rating; TP at SAR 37

JPMorgan initiated coverage of Saudi Aramco’s shares with an “overweight” recommendation and a target price of SAR 37, Reuters reported on Wednesday.

The investment bank said its bullish view is based on the oil giant’s dividend growth outlook, with scope to increase the $75 billion baseline as production scales up.

JPMorgan further noted that Saudi Aramco’s ability to sell its oil at a premium, capital expenditure flexibility and a low debt-to-equity ratio, would allow it to distribute a higher percentage of cashflow.

HSBC also initiated coverage of Saudi Aramco on Wednesday, with a “hold” rating and a target price of SAR 36.80, while Goldman Sachs on Tuesday gave a “neutral” rating with a target price of SAR 41 a share.