[Infostock Daily= Reporter An Hoe Hyun] On the 7th, Kiwoom Securities changed its investment opinion to 'BUY' on Samsung Electro-mechanics, saying that the recovery of MLCC profitability is taking place faster than expected. The target share price remained at 170,000 won.
As a result, Samsung Electro-mechanics' sales forecast for the third quarter was raised from 2.1378 trillion won to 2.188 trillion won, and its operating profit was raised from 213.4 billion won to 235.6 billion won, respectively. Its revised operating profit estimate is 25% growth compared to same period of last year.
"The pace of improvement in MLCC's performance will be greater than expected due to strong performance of major customers and China-oriented mobile products. The sales of flagship smartphones and Galaxy A are increasing in the second half of the year, and Chinese smartphone makers are securing short-term inventories due to the U.S. Department of Commerce's intensifying sanctions on Huawei," said Kiwoom Securities.
"Because demand for IT products is relatively good in the COVID-19 environment, It is showing superior performance compared to its competitors," the company said, adding, "The sales performance of the Galaxy Note 20 Ultra model is good, and the mmWave antenna module substrate is high in terms of production capacity erosion and utilization rate."
Based on this, Samsung Electro-mechanics' sales and operating profit are expected to rise 5.9% from this year to 8.6698 trillion won and 819 billion won, respectively.
Reporter An Hoe Hyun ahh@infostock.co.kr
