[Infostock Daily= Reporter An Hoe Hyun] SK Securities maintained its investment opinion of 'BUY' and target stock price of 18,000 won, saying that LG U+ has a high profit growth rate compared to its competitors, but is undervalued because it is not reflected in its stock price.
"LG U+'s second-quarter operating profit rose 59.2% from the same period last year, overwhelming the growth rate of its competitors," the company said, adding, "Although its annual operating profit is expected to increase 31% this year from last year and its positive performance will continue in the second half of this year, the return on stock prices in August compared to its performance improvement is only 4.4%, which does not reflect this."
"Although the stock price increase was limited due to controversy over LG U+'s use of Huawei equipment in additional 5G investments such as 5G exclusive mode(SA) and 28GHz, this is an excessive concern," the company said, adding, "In Europe, such as France, Germany, Serbia, and Portugal, there are still many countries that do not exclude Huawei."
"Although the issue of Huawei equipment is a factor that limits the rise in stock prices, recent concerns are excessive due to the difficulty of direct regulations on LG U+," researcher Choi said and added, "It is time for performance improvement to be reflected in stock prices, including high profit margins."
Reporter An Hoe Hyun ahh@infostock.co.kr
