[Click eStock] "Doosan Bobcat, 'Record High Performance' Highlights Undervalued Appeal"

Published 02 Feb.2024 07:46(KST)

Doosan Bobcat Quad Track Loader Demonstration

On the 2nd, KB Securities stated, "Doosan Bobcat, which achieved record-high performance last year, is expected to experience a slowdown in growth this year," adding, "The government's stock market stimulus measures will highlight the attractiveness of undervaluation in its stock price."

Doosan Bobcat recorded consolidated sales of 2.3191 trillion KRW and operating profit of 259.4 billion KRW in the fourth quarter of last year. Sales slightly missed the existing forecasts from the securities industry, while operating profit slightly exceeded expectations. Annually, it achieved record-high performance with sales of 9.7624 trillion KRW and operating profit of 1.3933 trillion KRW.

Jung Dong-ik, an analyst at KB Securities, said, "This year, due to the COVID-19 endemic, a decline in sales of passenger lawn mowers and small tractors is inevitable, leading to stagnant sales and decreased operating profit," adding, "As competition intensifies in the core product markets, costs such as selling and administrative expenses are also expected to increase."

The analyst added, "Nevertheless, Doosan Bobcat's stock is trading at a price-to-earnings ratio (PER) of 6.0 times and a price-to-book ratio (PBR) of 0.7 times," and predicted, "Given the significant undervaluation, it is highly likely that the stock price will find its proper value as the government's stock market stimulus measures take effect."

He continued, "Doosan Bobcat consistently returns value to shareholders by paying cash dividends of 3-4% annually," and added, "If former President Trump's popularity continues in relation to next year's U.S. presidential election, investor interest in Doosan Bobcat is expected to increase due to expectations for infrastructure investments such as new city construction."