LG Display Smiles on Earnings Expectations

[Asia Economy Reporter Song Hwajeong] LG Display's stock price has been soaring recently on expectations of improved earnings. It has set a new 52-week high for three consecutive days.

On the 15th, LG Display's stock price rose to 22,150 KRW early in the trading session, marking a new 52-week high for the third consecutive day. It has increased by about 16% since the beginning of this year until the previous day.

This strong performance of LG Display is interpreted as being due to expectations of earnings improvement. According to financial information provider FnGuide, LG Display's consensus operating profit for the fourth quarter of last year is expected to be 290.8 billion KRW, turning profitable compared to the same period last year. Kwon Seongryul, a researcher at DB Financial Investment, said, "We are revising LG Display's fourth-quarter operating profit upward from 242 billion KRW to 472.3 billion KRW," adding, "This figure significantly exceeds the consensus and shows an improving trend in the fourth quarter following the turnaround in the third quarter, marking the highest level since the fourth quarter of 2017." It is analyzed that plastic organic light-emitting diode (POLED) has entered the profit phase due to increased volume from overseas strategic customers, and the rise in liquid crystal display (LCD) panel prices has resulted in favorable profitability across TV, monitor, and notebook panels.

Due to the rise in LCD panel prices, a favorable environment is expected this year as well. Kim Unho, a researcher at IBK Investment & Securities, said, "The price increase of LCD TV panels, which is the biggest variable in securing profitability, is expected to continue," adding, "The effect of new models from overseas clients will also continue until the first half of this year."

Along with earnings improvement, target stock prices are also being revised upward. DB Financial Investment raised LG Display's target price from 20,000 KRW to 27,000 KRW, Samsung Securities raised it by 21% to 23,000 KRW, and Shinhan Financial Investment raised it by 19% to 25,000 KRW. So Hyuncheol, a researcher at Shinhan Financial Investment, explained, "Considering a company-wide operating profit turnaround to 1.112 trillion KRW this year, we raised the target price," adding, "LG Display's stock price has a high correlation with LCD TV panel prices, and with the new OLED business normalizing, there is high potential for further stock price increases."

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