[THE INVESTOR] S&T Motiv’s third-quarter earnings were weaker than expected, said NH Investment and Securities on Nov. 5 lowering the target price to 35,000 won (US$31.17) from 45,000 won.
It failed to meet market consensus with 257.3 billion won revenue and 14.7 billion won operating profit, and its profits from domestic defense sector will decline further as it faces competition. The outlook for automotive sector is not clear as demand from North American and Chinese automobile industry is deteriorating. Moreover, uncertainties over GM Korea’s return to normal still looms, noted the analyst. Its core businesses oil pump and motor, however, still maintain growth momentum, said analyst Cho Su-hong.
The fact that it is acquiring 15 billion won worth of its own shares is preventing further decline in stock price, added the analyst maintaining a “buy” recommendation.
By Hwang You-mee (firstname.lastname@example.org)