April 23, 2024

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[THE INVESTOR] Samsung Electro-Mechanics will post an earnings surprise in the third quarter, said KB Investment and Securities on Oct. 5, maintaining a “buy” recommendation and 220,000 won (US$194.52) target price. 

Its operating profit in the period will surge 256 percent on-year to 367.6 billion won 20 percent higher than market consensus. The average price of MLCC has risen 9 percent from the previous quarter pushing operating margin of the product close to 40 percent. The operating margin of camera modules has also been restored to 5 percent from the smartphone boom of 2012 on the back of high specification multi-cameras, said analyst Kim Dong-won.

Operating profit in the fourth quarter will soar 285 percent on-year to 411 billion won, 42 percent higher than market estimates as MLCC prices will increase over 10 percent. Other sectors including camera modules and printed circuit boards will also advance significantly, said the analyst suggesting its stocks as a “top pick.” 

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