Is it cheap or expensive right now?

Latest price vs our fair value. A comparison, not a recommendation.

In plain terms: Elm Company has crashed ~49% from its January-2025 peak (SAR 1,289, P/E ~56×) to SAR 658.5 (P/E ~24×) — the de-rate has done most of the work of correcting the euphoria, and the shares now trade close to, and slightly above, our weighted central fair value of SAR 620. On a neutral-beta discounted-cash-flow (β 1.0, WACC 10.5%) the business is worth about SAR 576; crediting the ~88% return on invested capital and ~70% recurring revenue, the multiple-based lenses land at SAR 590–690. The whole gap is a discount-rate argument, because ~77% of DCF value is terminal: if the market prices Elm as the low-beta government compounder it has historically been (β ~0.7), fair value is closer to SAR 750; if it re-rates Elm as a high-beta growth name after the crash (β ~1.6), fair value falls toward SAR 400. Elm’s moat is exclusive access to Saudi Arabia’s national data registry behind its highest-margin Digital Business line (73.8% of 2024 revenue); any erosion of that exclusivity is the other swing factor. What moves it near-term is the market’s view of Elm’s risk and any registry-access news — there is no dividend cushion worth mentioning (yield ~1.3%) while the argument resolves.

Key levels

The 5th–95th and 25th–75th percentile bands from the 50,000-path simulation. Static and pre-computed — independent of the fundamental value.

What drives the odds

50,000 paths on a Student-t engine fitted to Tadawul’s own volatility panel (not borrowed from another market): the discount-rate/beta re-rating (the crux), government digital-spend growth, broader Tadawul risk appetite, and idiosyncratic execution vol — plus event forces: a registry-exclusivity or margin shock, a platform-launch or contract-win surprise, a quarterly earnings surprise, and broader macro events. Drift is carry-anchored (risk-free minus dividend yield) with no directional signal layered on — Saudi names run carry-only until the Tadawul panel reaches ~5 names. Details in the methodology.