[Click eStock] "Hyundai Motor Target Price Raised to 380,000 Won"

Yuanta Securities on the 29th slightly raised Hyundai Motor's target stock price to 380,000 KRW and maintained a buy rating.

At the CEO Investor Day (CID) in June 2023, Hyundai Motor set mid- to long-term electric vehicle (EV) sales targets of 940,000 units in 2026 and 2 million units in 2030. However, due to a temporary stagnation in EV demand continuing since the second half of 2023, the short-term (next 2-3 years) EV sales targets were revised. The 2027 EV sales target presented at this CID is 840,000 units. Nevertheless, the 2030 target remains at 2 million units, the same as last year. Hyundai is expected to respond to the changed market environment with hybrid electric vehicles (HEV) and extended-range electric vehicles (EREV). HEV sales in 2023 (370,000 units) increased by about 50% compared to the previous year. The first half of this year also saw a 25% increase. The HEV sales target for 2028 is 1.33 million units. Another countermeasure, the EREV, is scheduled for mass production in North America and China in 2026, with sales starting in 2027.

At this CID, Hyundai announced a value-up program to be implemented from 2024 to 2027. Policies to be applied this year include the introduction of a minimum annual dividend per share (DPS) of 10,000 KRW and specifying the purpose of share repurchases. From 2025 to 2027, the company plans to introduce the concept of total shareholder return (TSR) and pursue quarterly dividends of 2,500 KRW. It also proposed share repurchases totaling 4 trillion KRW over three years (considering preferred stock discounts). Furthermore, Hyundai aims for an average return on equity (ROE) of 11-12% over three years and to achieve a mid- to long-term operating profit margin (OPM) of over 10%. This is considered a strengthened policy compared to the mid- to long-term shareholder return policy announced in April 2023. Hyunsoo Lee, a researcher at Yuanta Securities, said, "Compared to competitors Toyota and Honda's shareholder return policies, this is not a low level," adding, "They announced a policy at a higher level than expected. It is likely to elicit a positive response from investors." The target price-to-earnings ratio (PER) of 6 times is maintained, but the target stock price was slightly raised to 380,000 KRW due to changes in earnings estimates and applied earnings per share (EPS).

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