[Click eStock] "LG Electronics Target Price Lowered from 140,000 to 120,000 Won"

On the 26th, NH Investment & Securities lowered LG Electronics' target stock price from 140,000 KRW to 120,000 KRW. This revision reflects a downward adjustment in earnings forecasts due to margin decline, subsidiary performance slowdown, and value depreciation. However, considering the competitiveness of the home appliance division, potential demand recovery, and growth prospects in the automotive components sector, the investment rating was maintained at "Buy."

The company projected the 2024 operating profit to be around 3.6088 trillion KRW, a 7.3% decrease from the previous estimate. This reflects margin declines caused by rising raw material costs such as LCD panels in the TV and BS divisions, as well as a downward revision in the earnings outlook for subsidiary LG Innotek.

For the first quarter, operating profit is expected to record 1.3162 trillion KRW, slightly below initial expectations, indicating a contraction. The increase in LCD panel prices is anticipated to weaken margins in the TV and BS divisions compared to the previous year, with the decline in LG Innotek's performance being a major factor.

Nonetheless, despite concerns such as the lack of a full-scale recovery in home appliance demand and rising transportation costs, the home appliance division is expected to see year-on-year operating profit growth. Additionally, despite a slowdown in demand in the automotive components sector, profit growth is anticipated, which is positive. Researcher Lee Gyu-ha stated, "If demand in the home appliance market improves and growth in the automotive components sector expands again, a sharp recovery in the stock price is expected."

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