[Click e Stocks] "SK Bioscience, 4Q Earnings Expected to Meet Estimates... Target Price Down"

[Asia Economy Reporter Song Hwajeong] Hana Financial Investment forecasted on the 24th that SK Bioscience's fourth-quarter earnings last year would meet market expectations (consensus). The investment opinion was maintained as 'Buy,' but the target stock price was lowered from 310,000 KRW to 290,000 KRW, reflecting the stock price fluctuations of global peers.

Jae-kyung Park, a researcher at Hana Financial Investment, explained, "The target price downgrade reflects a decrease in the target multiple due to stock price fluctuations of global contract manufacturing organization (CMO) peers (Lonza, WuXi Biologics, Samsung Biologics) and revisions in earnings estimates, adjusting the operating value from 18.5 trillion KRW to 17.1 trillion KRW." He added, "However, the target price could be raised depending on supply contracts for the Novavax COVID-19 vaccine to Thailand and Vietnam, as well as individual country supply contracts for the COVID-19 vaccine candidate GBP510."

SK Bioscience is estimated to have recorded its highest-ever quarterly earnings in the fourth quarter of last year. Hana Financial Investment projected SK Bioscience's consolidated fourth-quarter sales to increase by 684.5% year-on-year to 525.7 billion KRW, and operating profit to surge by 2216.6% to 252.8 billion KRW. These figures align with the consensus of 531.4 billion KRW and 262.4 billion KRW, respectively. Researcher Park explained, "CMO segment sales are expected to increase by 164.9% quarter-on-quarter to 117 billion KRW, and license-in (technology acquisition) Novavax vaccine sales, reflecting government supply of bulk material, are estimated to rise by 160.8% to 374.2 billion KRW, resulting in the highest-ever quarterly earnings."

This year's performance is also expected to be solid, with sales increasing by 93.3% year-on-year to 1.9405 trillion KRW and operating profit rising by 77.2% to 838 billion KRW. Researcher Park stated, "Even excluding the uncertain individual supply contracts for GBP510, sales are estimated to increase by 29.3% year-on-year to 1.2975 trillion KRW. Additionally, the scope of the Novavax COVID-19 vaccine license-in contract, previously limited to South Korea, has been expanded to Thailand and Vietnam. If national-level supply contracts are secured in Thailand and Vietnam, the corresponding volume could be additionally reflected in sales based on finished product prices."

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