TES, Memory Downcycle Preliminary Reflection (NH Investment & Securities)

NH Investment & Securities raised its target price from 31,000 won to 35,000 won, and raised its investment opinion from 'hold' to 'buy', saying the memory downcycle was reflected in the stock price of TES.

"NH Investment & Securities has offered a 'hold' investment opinion on TES over the past year, citing a decline in investment due to the entry of the memory semiconductor downcycle," NH Investment & Securities said. "The memory semiconductor down cycle, which is expected from the fourth quarter of this year to the second quarter of next year, has been mostly reflected in the current stock price of TES, which has fallen until recently.".

"It is time to increase the proportion of semiconductor equipment industries, including TES, in preparation for the improvement of the supply and demand of memory semiconductors after the second half of next year," NH Investment & Securities said.

"We fell below the consensus of 55 billion won in sales, 6.3 billion won in operating profit and 7.1 billion won in net profit in the third quarter, and most equipment orders from major customers such as Samsung Electronics and SK Hynix were made by the first half of the year," NH Investment & Securities explained.

NH Investment & Securities said, "We expect that performance improvement will not be significant in the fourth quarter, and we expect sales of 54.4 billion won and operating profit of 7.2 billion won in the fourth quarter.".

"TES's quarterly earnings will also begin to improve in the second quarter of next year and will improve significantly in the second half of next year," said NH Investment & Securities.

Reporter Lee Dong-hoon usinvestmentidea2020@gmail.com