[Click eStock] "Wonik IPS, Revenue Recognition Delay... Stock Price Will Rebound"

[Asia Economy Reporter Ji Yeon-jin] Kiwoom Securities forecasted on the 10th that Wonik IPS's second-quarter earnings this year fell short of expectations, but it would have little impact on the stock price trend.

Park Yu-ak, a researcher at Kiwoom Securities, said, "The reason Wonik IPS's earnings fell below expectations is merely a delay in the timing of revenue recognition," adding, "Wonik IPS's stock price has already plummeted to the lowest level due to concerns over economic recession and reduced investments by client companies, and from this point forward, next year, which will determine the stock price direction, will be a year highlighting mid- to long-term earnings growth as 'semiconductor equipment sales of about 300 billion won postponed from the second half of this year' are recognized, and 'capital expenditures (CapEx) by Samsung Electronics and SK Hynix are re-executed.'"

Researcher Park said, "Since the memory semiconductor industry, the upstream sector, is expected to pass its worst point in the third quarter of this year, Wonik IPS's stock price is also expected to rebound," and added, "We consider this a buying opportunity at a low price and maintain it as our top pick in the semiconductor equipment sector."

Wonik IPS's second-quarter sales this year were 199.8 billion won, down 4% from the previous quarter, and operating profit was 18.5 billion won, down 16%. These results fell short of market consensus. In semiconductors, the mass production timing of Samsung Electronics' P3 was postponed to the end of this year or early next year, and in displays, equipment delivery to Chinese customers was delayed to the second quarter of this year.

By business segment, semiconductor sales increased 20% to 184.3 billion won, while display sales decreased 72% to 15.6 billion won.

Operating profit for the third quarter of this year is expected to surge 254% quarter-on-quarter to 65.6 billion won. Sales are expected to increase 76% to 351.3 billion won.

Researcher Park emphasized, "This is because a large amount of revenue recognition for equipment supplied to SK Hynix is underway, and sales postponed from the previous quarter will also be recognized," adding, "The display segment will also reflect deferred sales from the previous quarter, showing significant earnings growth compared to the previous quarter."