[Click eStock] "EO Technics, Performance Improvement Starts in Q3... Target Price Up"

Target Price Raised from 178,000 Won to 240,000 Won

Hi Investment & Securities raised the target price for EO Technics from KRW 178,000 to KRW 240,000 on the 18th, expecting a full-scale improvement in performance starting from the third quarter of this year. The investment rating was maintained as 'Buy.'

Song Myung-seop, a researcher at Hi Investment & Securities, said, "EO Technics' quarterly performance is expected to improve significantly across all major sectors from the third quarter, and growth drivers such as cutting equipment, UV drillers, and annealing equipment are also believed to be progressing smoothly." He explained, "The new target price was derived by applying a 4.9x multiple of the price-to-book ratio (PBR) at the peak over the past six years to this year's expected book value per share (BPS)."

Hi Investment & Securities forecast EO Technics' second-quarter sales and operating profit to be similar to the previous quarter, at KRW 73.5 billion and KRW 7 billion, respectively. Researcher Song said, "Sales are expected to slightly increase in most product lines compared to the previous quarter, but due to the base effect from the previous quarter, sales in the driller and other segments are expected to slightly decrease."

Quarterly performance improvement is expected to accelerate from the third quarter. Researcher Song stated, "From the third quarter onward, sales in the previously sluggish display equipment sector will increase due to the resumption of investments by the largest customer, and sales of the main product, marker equipment, will also begin to recover with the improvement in the business environment." He added, "Sales for the third and fourth quarters are estimated at KRW 91.9 billion and KRW 102.3 billion, respectively."

Laser cutting equipment is evaluated to be progressing smoothly. Researcher Song said, "EO Technics' grooving equipment appears to be receiving steady orders from Taiwanese semiconductor back-end (OSAT) companies, and EO Technics, which owns picosecond laser pulse equipment with faster laser scanning speed compared to competitors, is expected to increase its market share." He analyzed, "Additionally, the stealth dicing equipment has been certified by the largest domestic customer, with orders received in the second quarter and sales beginning in the third quarter." He added, "This year, the order amount for the cutting equipment sector is estimated at KRW 25 billion, with sales recognition around KRW 20 billion. Next year, grooving equipment is expected to start being applied to high-bandwidth memory (HBM) 4, and the application area of stealth dicing equipment may expand to the entire memory semiconductor sector."

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