"Surprise Earnings" Announcement... Cheonggaeguri Stock Price

Pan Ocean Q3 Operating Profit Up 203%... Stock Price Retreats
Sell Orders Amid Peak Out Concerns

[Asia Economy Reporter Ji Yeon-jin] Recently, companies that announced ‘surprise earnings’ have seen their stock prices fail to maintain momentum. For some companies, their corporate value even declined on the day they revealed earnings surprises.

According to the Financial Supervisory Service’s electronic disclosure system on the 28th, Pan Ocean announced that its Q3 sales and operating profit this year increased by 109.4% and 203.9% year-on-year, recording 1.3282 trillion KRW and 191.3 billion KRW, respectively. This is a much better performance than market expectations. However, on the same day, Pan Ocean closed trading at 6,240 KRW, down 0.79% from the previous day.

OCI, which also announced earnings on the same day, saw sales jump 89.9% to 888.7 billion KRW and operating profit soar 976.9% to 194.5 billion KRW, but its closing price fell 2.18%. Samsung Electro-Mechanics also exceeded market expectations with sales increasing 20.6% to 2.6886 trillion KRW and operating profit rising 48.9% to 457.8 billion KRW during this period. Samsung Electro-Mechanics’ closing price dropped 1.24% to 159,000 KRW. LG Display, whose Q3 operating profit increased by 221.8%, also closed down 0.27%.

While the domestic stock market fell together the previous day due to inflation concerns and sluggish performance in the Greater China stock market, dampening investor sentiment, the strong earnings were also seen as a sign of ‘peak out’ (a decline after an economic peak), which led to a flood of sell orders. In fact, Pan Ocean’s stock price had been declining since the end of last month amid concerns over a downturn in the shipping industry, falling 17.35% up to the day before yesterday this month. Samsung Electro-Mechanics, which has been on a downward trend since the 15th of last month, is expected to have somewhat weak Q4 earnings this year. NH Investment & Securities analyst Lee Kyu-ha explained, “Demand for major downstream industries such as PCs and TVs is slowing, and inventory adjustments for smartphones in the Greater China region are also expected.”

However, OCI, which hit its yearly high of 169,000 KRW on the 1st of this month, had fallen 16.20% up to the day before yesterday but succeeded in rebounding at the opening price on that day. This is because, with countries around the world striving for carbon neutrality, the solar power business is expected to perform well.