[Click eStock] "Park Systems, Expected Profit Margin Recovery with Industrial Atomic Force Microscopes"

Price-to-Earnings Ratio Applied at 36x, Target Stock Price 220,000
Industrial Atomic Force Microscope Sales Growth Expected
Industrial Sales Likely to Increase by 29% Year-on-Year

Daishin Securities analyzed on the 25th that Park Systems is expected to see a recovery in profit margins centered on industrial atomic force microscopes. The investment opinion 'Buy' and the target price of 220,000 KRW were maintained. Park Systems' closing price on the previous trading day was 184,000 KRW.

Researcher Shin Seok-hwan of Daishin Securities stated, "The target price was calculated by applying a 12-month forward earnings per share (Fwd EPS) of 6,048 KRW and a target price-to-earnings ratio (Target P/E) of 36 times (which includes a 15% premium over the global industry average)." He added, "The company has established itself as a global leader in the AFM (atomic force microscope) field, and plans to supply industrial atomic force microscopes not only for semiconductor front-end processes but also for back-end processes." He also noted, "Additionally, the application areas are expanding through the supply of large-area atomic force microscope equipment for displays."

Park Systems' second-quarter sales are expected to be 42.5 billion KRW, a 65% increase compared to the previous quarter. Operating profit is estimated at 10.6 billion KRW. As of the end of the first quarter, the order backlog stood at 85.2 billion KRW (68.7 billion KRW for industrial use, 12.7 billion KRW for research use), up 16% year-on-year. Equipment delayed due to customer installation schedule postponements in the first quarter is expected to be recognized as sales in the second quarter. Furthermore, orders for high-priced equipment such as Hybrid WLI/NX-mask/NX-Wafer are expected to expand in the second quarter as well.

Considering that the sales recognition lead time for industrial atomic force microscope equipment is 4 to 6 months, second-quarter industrial sales are estimated to increase by 67% from the previous quarter to 30.7 billion KRW. Researcher Shin said, "With the expansion of supply of high-value-added products such as NX-Wafer and NX-mask equipment, industrial sales in 2024 are expected to reach 125.3 billion KRW, a 29% increase year-on-year." He added, "Although cost increases due to workforce expansion are expected from the second half of this year, profit margin recovery is anticipated due to the expanded supply of high-priced industrial atomic force microscopes."