[Click eStock] "Samsung Electro-Mechanics: Industry Appeal Declines but Profit Improves"

[Asia Economy Reporter Ji Yeon-jin] Hi Investment & Securities stated on the 28th that although the overall attractiveness of the industry may decline, Samsung Electro-Mechanics stands out with expected earnings improvement within the sector, maintaining a buy investment opinion and a target price of 230,000 KRW.

Go Eui-young, a researcher at Hi Investment & Securities, said, "The peak-out of durable goods demand is a major concern, but upward revisions of profit estimates in the second half are expected to be prominent within the industry."

Samsung Electro-Mechanics, an electronic components company, is expected to see a year-on-year decline in notebook shipments from October, which had greatly benefited from the untact trend. More than 20% of the company's MLCC and semiconductor substrate sales are generated from the PC market. The decline in stock price momentum since the beginning of the year is also due to concerns about the sustainability of demand strength.

However, it is explained that the product mix improvement of MLCC and substrates is highlighting competitive advantages in the market. This is because supply shortages are intensifying as competitors' factory operations have been disrupted.

In the third quarter, sales are expected to increase by 13.7% year-on-year to 2.6 trillion KRW, and operating profit is expected to rise by 45.8% to 441 billion KRW. Researcher Ko forecasted that sales will exceed existing market estimates by +2.5% and operating profit by +5.5%.

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