Feb. 20 (Bloomberg) -- Etisalat, the largest of the United Arab Emirates’ two phone companies, rose to the highest level in more than three months as a potential 17 percent dividend increase overshadowed earnings below estimates.
Shares of Emirates Telecommunications Corp., as the company is formally known, advanced 2.9 percent to 10.10 dirhams, the highest level since Nov. 14, at the close in Abu Dhabi. The shares were the biggest gainer on the benchmark ADX General Index, which rose 1.6 percent.
Etisalat’s board recommended a 45 fils a share dividend for the second half, taking the total 2012 dividend to 70 fils a share, compared with 60 fils for 2011. The company with the second-heaviest weighting on the benchmark index said yesterday full-year profit surged 15 percent to 6.74 billion dirhams ($1.8 billion), missing the 7.54 billion-dirham mean estimate of nine analysts, according to data compiled by Bloomberg.
“What is attracting investors to Etisalat shares today is cash dividends that came above expectations,” said Tariq Qaqish, deputy head of asset management at Dubai-based Al Mal Capital PSC. Growth in sales also helped the shares gain, Qaqish said. Etisalat said revenue grew 2 percent to 33 billion dirhams.
The company’s 14-day relative strength index rose to 79 today. A reading above 70 indicates to some investors that the security is poised to drop. Four analysts recommend investors buy Etisalat shares, six have a hold rating on the stock and none say sell, according to data compiled by Bloomberg.
--Editors: Alaa Shahine, Claudia Maedler