[Click eStock] "LX Semicon, Strengthened Profitability"… Target Price Up 28%

[Asia Economy Reporter Ji Yeon-jin] Yuanta Securities announced on the 11th that it maintained a buy rating on LX Semicon, considering the improved profit strength and the possibility of supply to new customers, and raised the target price by 28% from the previous 140,000 KRW to 180,000 KRW. The target price was set by applying a price-earnings ratio (PER) of 9 times, which is the PER of the largest competitor, Taiwan's Novatek, to this year's expected earnings per share (EPS).

For LX Semicon, sales are expected to increase by 46.1% to 530.5 billion KRW and operating profit to rise by 311.6% to 102 billion KRW in the last five quarters. Although sales of large DDI for LCD TVs are expected to decline due to decreased front-end demand, the increase in small DDI supply to North American customers is expected to offset this, resulting in steady sales growth. However, profitability is expected to decline compared to the previous quarter due to a worsening mix caused by an increased mobile proportion and the reflection of employee performance bonuses.

This year's expected performance is projected to record sales of 2.17 trillion KRW, a 14.5% increase from the previous year, and operating profit of 390 billion KRW, a 1.1% increase. Researcher Kim Kwang-jin of Yuanta Securities said, "Although large DDI for LCD TVs is expected to be somewhat sluggish due to a high base, demand for OLED TVs, IT products, and mobile devices will increase, driving sales growth," adding, "In particular, the increase in supply to North American customers is expected to prominently increase the proportion of DDI for IT products and mobile devices."

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