[Special Stock] Hyundai Motor Plummets Despite Record Quarterly Earnings... "Peak-Out Concerns"

Despite Hyundai Motor Company recording its highest quarterly performance ever, its stock is plummeting. It appears that selling pressure has intensified due to concerns over a peak in earnings.

[Image source=Yonhap News]

As of 9:42 AM on the 26th, Hyundai Motor is trading at 234,500 KRW, down 6.96% from the previous day.

The day before, Hyundai Motor announced that its sales for the second quarter of this year increased by 6.6% year-on-year to 45.0206 trillion KRW, and operating profit for the same period rose by 0.7% to 4.2791 trillion KRW. Both sales and operating profit represent the highest quarterly results ever recorded.

Despite these strong results, concerns about future earnings slowdown have emerged in the securities industry. Kang Sung-jin, a researcher at KB Securities, stated, "Annual sales volume is expected to stagnate compared to last year, and after dealer inventory replenishment ends by the end of the year, there will be additional factors causing sales decline." He added, "Although the exchange rate effect is still a positive factor for operating profit, most of this effect will disappear by the end of the year." Furthermore, he noted, "Despite the still positive exchange rate effect, the rising proportion of North American sales, and profitability improvement factors such as electric vehicle sales being replaced by hybrids, it has been confirmed that contribution profit has been declining since peaking in the second quarter of last year."