April 23, 2024

• 

[THE INVESTOR] Korea Aerospace Industries is relatively less appealing in terms of valuation than its foreign peers, said Samsung Securities on Feb. 19, lowering the target price to 48,000 won (US$44.91) from 53,000 won while maintaining a “hold” recommendation.

The defense company has been showing high and predictable profit growth since it went public in comparison with peers overseas, but has significantly lost its edge as changes in audit standards were introduced last year, profits fluctuations expanded, and its growth has slowed down, said analyst Han Yeong-su.

The outlook for its profits is looking down and even assuming that its profits will return to normal next year, KAI is already being dealt at a similar level with Lockheed Martin, Boeing and Airbus, noted the analyst adding that despite the recent stock price decline, its valuation appeal is not sufficient.

By Hwang You-mee (glamazon@heraldcorp.com)