[Click eStock] "LG Electronics Target Price Lowered Amid Macroeconomic Uncertainty"

On April 28, BNK Investment & Securities lowered its target price for LG Electronics from 120,000 won to 96,000 won. The decision was made due to uncertainties in the macroeconomic environment, including the imposition of reciprocal tariffs by the Donald Trump administration in the United States.

Lee Minhee, a researcher at BNK Investment & Securities, predicted that LG Electronics' growth in the second quarter would slow and fall short of market expectations. In the previous first quarter, LG Electronics recorded separate sales of 17.91 trillion won and operating profit of 1.13 trillion won, excluding LG Innotek.

Lee forecasted LG Electronics' separate operating profit for the second quarter to be 730.4 billion won, which is significantly below the market consensus of 900 billion won.

She analyzed, "Separate sales for the second quarter are expected to reach 17.64 trillion won, indicating a slowdown in top-line growth. The ES growth rate, which was excessively high in the previous quarter, is projected to slow from 18% year-on-year to 5%, while MS is expected to see negative growth of 6% year-on-year due to worsening market conditions."

Lee expressed concerns about a decline in LG Electronics' final demand and lowered the target price to 96,000 won. She maintained a 'buy' investment rating.

She stated, "Despite sluggish global consumer demand, it is positive that LG Electronics continues to achieve steady sales growth and maintain solid profitability." However, she also said, "Uncertainties in the macroeconomic environment, such as reciprocal tariffs, remain high, and their impact is expected to gradually materialize."

She added, "LG Electronics is working to reduce the impact of tariffs through local production in the United States and regional diversification, and is even considering raising consumer prices for some premium products. However, these measures could further dampen final demand. Accordingly, we are revising down our annual consolidated sales and operating profit forecasts by 4% and 22%, respectively, for this year."