[Featured Stock] Simtek Rises on Expectations of Earnings Improvement Due to IT Demand Recovery

Simtek is on the rise. It appears that securities firms' analysis expecting improved performance due to the recovery in IT demand has had an impact.

As of 10:16 AM on the 24th, Simtek was trading at 29,500 KRW, up 400 KRW (1.37%) compared to the previous trading day.

Choi Jun-won, a researcher at Shin Young Securities, said, "An increase in global AI activities in 2024 is expected to expand demand for SSDs used in data centers," adding, "The sales proportion for mobile in 2023 is estimated to be about 23% of consolidated sales, approximately 23.8 billion KRW. Due to the smartphone replacement cycle arrival and the expansion of AI smartphone demand, growth in sales of mobile MCP products is expected."

He continued, "The previously sluggish PC demand is expected to gradually increase until the second half of 2025 due to the launch of AI PCs and the end of Windows 10 service support," and forecasted, "Global PC shipments in 2023 are 250 million units, and PC shipments in 2025 are expected to increase by 14% compared to 2023, reaching about 286 million units, which supports expectations for Simtek's PC-related sales growth."

He added, "It has been identified that the low order volume in January and February this year has been recovering since March, and it takes about 1 to 1.5 months from order to shipment," emphasizing, "A deficit is expected to continue in the first quarter, but a turnaround to profit is anticipated from the second quarter, with cumulative operating profit turning positive from the third quarter."