[Click eStock] Sollid, Operating Profit Growth Expected in Q2 as Well

Hana Securities analyzed on the 19th that Solid's performance improvement will continue in the second quarter as well. The investment opinion of 'Buy' and the target stock price of 15,000 won were maintained.

Kim Hong-sik, a researcher at Hana Securities, said, "The performance improvement trend that has continued since the second quarter of 2022 is expected to continue in the second quarter and the second half of this year," adding, "US DAS sales and European government office sales have been steadily recognized as revenue without significant volatility since the second half of 2022, so the long-term performance outlook until 2024 is optimistic as originally expected."

Hana Securities forecast that Solid's sales and operating profit in the second quarter will increase by 2% and 58% year-on-year to 63.2 billion won and 4.9 billion won, respectively. Researcher Kim emphasized, "Sales and operating profit similar to those recorded in the first quarter, which was an earnings surprise, are expected," and "The reason for the performance improvement in the second quarter is that the main US DAS sales continue to perform well, while European government office sales are also steady."

Hana Securities projected that operating profit this year will approach 40 billion won. He explained, "This is due to the seasonal sales concentration effect and the recent revival of the Japanese market."

However, it was forecasted that supply and demand improvement is necessary for stock price increase. He explained, "Nevertheless, Solid's stock price continues to be in a frustrating situation where it has not risen significantly," adding, "Ultimately, the issue is supply and demand, but I think supply and demand improvement will appear by the end of the year at the latest." He added, "This is because an additional domestic 5G frequency auction is scheduled to take place."