[Click e-Stock] "BH Expected to Return to Profit in Q2"

On April 23, Daishin Securities maintained its 'BUY' investment rating on BH, a printed circuit board manufacturer, stating that the company is expected to return to profitability in the second quarter. However, due to earnings that fell short of consensus estimates for two consecutive quarters, the target price was lowered from 23,000 won to 20,000 won.

Daishin Securities projected that BH's first-quarter revenue this year would reach 325 billion won, an 8.8% increase year-on-year, but that the company would post an operating loss of 14.2 billion won, turning to the red both quarter-on-quarter and year-on-year. Operating profit has underperformed consensus estimates for two consecutive quarters, indicating weak results. As a result, the earnings per share (EPS) forecast for this year was cut by 18.5% compared to the previous estimate, and the target price was naturally adjusted downward as well.

However, the company is expected to post an operating profit of 28.2 billion won in the second quarter, returning to profitability compared to the previous quarter. This figure represents a 10% decrease year-on-year. The turnaround is attributed to the start of preliminary production for Apple’s iPhone 17. Although tariff tensions between the United States and China are a negative factor for Apple’s iPhone, initial production is expected to proceed as planned in the second quarter.

Based on BH's current share price, its valuation stands at a P/E ratio of 5.3 and a P/B ratio of 0.5, which are at historically low levels. Analyst Park Kangho stated, "Although growth this year is lower than in the past, market share is expected to expand in automotive wireless chargers and HDI (tablets). If differentiated growth is expected from next year onward, the valuation is attractive and the stock appears undervalued."