"Youngwon Trade Highlights Relative Attractiveness Compared to Peers... Target Price Up 5%"

[Asia Economy Reporter Park Jihwan] Shinhan Financial Investment announced on the 10th that it has adjusted its investment opinion on Youngone Corporation to 'Buy' and raised the target price by 5% to 42,000 KRW, stating that the relative attractiveness compared to global peers in the same industry has reached the highest level.

Heejin Park, a researcher at Shinhan Financial Investment, stated, "Operating profit on a consolidated basis for the third quarter is estimated to be 63.3 billion KRW, down 10.2% year-on-year," adding, "This figure is more than 10 billion KRW higher than the previous forecast." The main reasons for the upward revision of earnings are improvements in the OEM division's dollar orders and performance improvements in the Scott division.

The third quarter dollar-based order growth rate for the OEM division is estimated to decrease by 3.3% year-on-year. According to Park's analysis, depending on the final figures, expectations for sales to reach the same level as the previous year remain valid. The Scott division's sales and operating profit are also estimated to have increased by 14.2% and 38.0% year-on-year to 234.3 billion KRW and 5.7 billion KRW, respectively.

Researcher Heejin Park explained, "Although Youngone Corporation's stock price has risen more than 60% since the low point in March, it still remains about 16% lower compared to the beginning of the year," adding, "Even during the period since last August when peer companies' stock prices rose more than 80%, the company's stock price only increased by 18.8%, showing differentiation."

She emphasized, "Considering the estimated earnings revisions since the second quarter, the market-relative PER valuation is the most reasonable among global peers in the same industry."