[Click eStock] "Samsung SDS, Current Stock Price Undervalued"

[Asia Economy Reporter Park Jihwan] Shinhan Financial Investment maintained a 'Buy' rating on Samsung SDS on the 27th, stating that the current stock price is at a bottom level when looking at future prospects. However, the target price was lowered by 2.5% from the previous 238,000 KRW to 232,000 KRW.

Researcher Soh Hyuncheol of Shinhan Financial Investment evaluated, "The second quarter sales increased by 5.4% from the previous quarter to 2.567 trillion KRW, and operating profit for the same period rose by 14.9% to 197 billion KRW, slightly exceeding market expectations."

Although sales and operating profit decreased compared to the previous year due to sluggish IT investment by clients caused by the novel coronavirus disease (COVID-19), external IT service sales in public and financial sectors increased by 11% compared to the previous quarter. Additionally, sales from artificial intelligence and analytics increased by 6%, slightly surpassing consensus, according to the analysis.

However, operating profit for this year and next year is expected to be 6.8% and 2.8% lower than previously forecasted, respectively, leading to a slight reduction in the target price.

Researcher Soh Hyuncheol stated, "Recently, the government has presented industrial innovation policies for data, networks, and artificial intelligence, expanding business opportunities in cloud and AI sectors," adding, "With cloud services and the AI Brightics business value highlighted based on four domestic and thirteen overseas data centers, the current stock price is at a bottom level in the long term."

This content was produced with the assistance of AI translation services.