Al-Drees: Comprehensive Analysis of Saudi Petroleum Services Stock

Al-Drees Petroleum Services and Transport Company, commonly known as 'Al-Drees', is a Saudi joint-stock company specializing in providing fuel and logistics transport services. The company was established to meet the Kingdom's growing needs in the energy and transport sectors and manages a wide network of fuel stations located in vital areas across the Kingdom. Additionally, Al-Drees provides petroleum product transport services through a modern fleet of trucks, enhancing its role in the national fuel supply chain. The company falls within the logistics services sector related to industry and energy, playing a pivotal role in supporting the Saudi economic infrastructure. The listing of Al-Drees stock on the Saudi financial market (Tadawul) under the symbol 4200 allows individual and institutional investors to monitor its performance and participate in its sustainable growth.

Al-Drees stock is one of the prominent stocks in the services sector of the Saudi market, trading under the symbol 4200. The stock has shown stable performance with a growth tendency during 2024 and 2025, maintaining levels around 8 riyals per share, achieving a slight increase of nearly 2.5% from the beginning of 2025 to its end. Over the past five years, the stock has risen by approximately 200%, reflecting investor confidence in the company's ability to achieve strong and sustainable financial performance. Financial observers are keen to study the stock's price-to-earnings ratio, which stood at about 8.3 times at the end of 2025, placing it among the attractive stocks in terms of price versus earnings. The daily trading volume and high liquidity of the stock also reflect the interest of a wide range of individual and institutional investors.

The announced financial results for Al-Drees in 2025 show a continuation of strong growth, supported by rising fuel demand and an expanding service network. The company achieved a net profit of 113.8 million riyals in the third quarter of 2025, an increase of 34.5% compared to the same quarter of the previous year. For annual profits, estimates indicate that the net profit for 2024 was around 400 million riyals, with annual revenue growth exceeding 20% in 2025 compared to 2024. Fixed assets also increased by about 50% during the same year, reflecting the company's investments in expansion and infrastructure modernization. These indicators demonstrate the company's ability to manage its operational and financial growth efficiently.

Al-Drees is distinguished by a regular and relatively generous dividend distribution policy compared to the Saudi market average. In 2025, the Board of Directors approved a cash dividend of 0.73 riyals per share, equivalent to an annual distribution yield of approximately 8.8% of the current share price. These distributions cover between 70% to 80% of the company's net profits for 2024, reflecting management's commitment to returning a significant portion of profits to shareholders. This policy is one of the attractive factors for investors seeking stable cash returns and indicates the strength of the company's cash flows and its ability to meet growth and distribution needs simultaneously.

Al-Drees aims to enhance its presence in the Saudi market through an ambitious expansion plan. In 2024 and 2025, the company opened several new fuel stations in strategic areas such as Riyadh, Asir, and Hail, aiming to cover underserved areas and increase market share in the heavy and light transport sector. The expansion strategy relies on studying market needs and analyzing regional transport movements, focusing on fuel management technologies and developing station services. The company's transport fleet is also continuously updated to meet safety and efficiency standards, aligning with Saudi Vision 2030 for modernizing and developing energy infrastructure.

Al-Drees's activities fall within the petroleum and logistics services sector, which is one of the vital sectors in the Saudi economy. This sector is characterized by its direct connection to infrastructure projects and urban expansion, primarily relying on the growing local demand for fuel. The year 2024 witnessed an expansion in transport and infrastructure projects, positively impacting companies in the sector. Additionally, this sector is sensitive to global oil price fluctuations and government support policies, requiring companies to be flexible in responding to market changes. Growth is expected to continue in the coming years, supported by government investments and major national projects.

Al-Drees faces strong competition in the Saudi market from local and regional companies offering similar services in fuel distribution and logistics. Among the main competitors are Al-Ameen Petroleum Services Company, Amanat Al-Fuel, Al-Alamiya for Fuels and Transport, and Gulf Petrochemicals and Logistics Services Company. Additionally, the entry of major national projects such as NEOM and Qiddiya has intensified competition for contracts and services. Al-Drees is distinguished by its extensive network of stations, advanced transport fleet, and strong market reputation, with strategic alliances supporting its competitive position. This enables it to capitalize on growth opportunities and expand its customer base.

During 2024 and 2025, Al-Drees recorded a series of qualitative developments. The company opened new fuel stations in key areas and expanded its regional operations, contributing to increased sales volume and operational revenues. It also reported a marginal rise in its quarterly profits, with a net profit of approximately 113.8 million riyals in the third quarter of 2025. The company also announced special financial measures, including depositing amounts from the sale of fractional shares into shareholders' accounts, a step that enhances the stock's liquidity and attractiveness to investors. Furthermore, it strengthened its collaboration with government entities in fuel supply and adopted plans to expand its transport fleet and filling stations in line with Vision 2030 objectives.

The price-to-earnings (P/E) ratio of Al-Drees stock is considered an attractive indicator in the Saudi market, standing at about 8.3 times at the end of 2025. This figure indicates that the market values the company's earnings at nearly eight times the current share price, a relatively low level reflecting market confidence in the continued growth of profits. The cash dividend yield has reached approximately 8.8%, making it one of the highest yields among service sector stocks. These multiples align with the company's goals of achieving sustainable growth and providing rewarding dividends, further enhancing the confidence of investors seeking a balance between growth and fixed income.

Al-Drees places great importance on sound governance and adherence to the highest standards of transparency in its financial and administrative dealings. The company is committed to providing periodic reports on its financial results and developing its policies in line with the instructions of the Capital Market Authority. Al-Drees also participates in various social responsibility initiatives, such as supporting localization programs and developing national competencies, and contributing to community and charitable projects. These efforts reflect the company's commitment to promoting sustainable development, protecting the interests of shareholders and stakeholders, and supporting the national economy as a whole.

Al-Drees's strategy is directly influenced by Saudi Vision 2030, which focuses on diversifying national income sources and developing logistics and energy service sectors. The company aims to benefit from sustainable transport projects, investing in updating its fleet and stations to meet economic growth requirements. It also focuses on supplying fuel for mega projects and expanding its operations to include new areas. Al-Drees's response to government initiatives in clean transport and energy infrastructure development is a key factor in the sustainability of its operations and achieving future expansion goals.

Forecasts indicate that Al-Drees will continue to grow in the coming years, supported by its expansions in fuel stations and fleet modernization. The company also benefits from relative stability in oil prices and increasing local demand for fuel, enhancing its ability to achieve sustainable profits. Al-Drees is exploring new financing opportunities such as additional offerings or partnerships with local and international companies to support its expansion plans. These trends affirm the company's ability to maintain its leading position in the petroleum and logistics services sector in the Kingdom.

Al-Drees plays a pivotal role in supporting national fuel supply chains in the Kingdom through its extensive network of stations and petroleum transport services. The company contributes to securing fuel for factories, government projects, and the transport sector, making it an essential part of the infrastructure of the Saudi economy. This position enhances its ability to negotiate strategic supply contracts and expand its customer base across various industrial and service sectors.