Season of Cost Recovery from Tariffs... Expectations Rise for Hyundai Mobis Earnings [Click e-Stock]

Price Increases Expected in the U.S.
Expanding Portfolio with Robotics Parts Supply

Hyundai Mobis is expected to post solid operating profit for the fourth quarter of last year, despite a decrease in finished vehicle shipments. This is because costs related to compensation for suppliers due to sluggish electric vehicle orders from client companies, as well as expenses from U.S. tariff negotiations, are expected to be recovered.

On January 8, Kiwoom Securities raised its target price for Hyundai Mobis by 18.8% to 475,000 won, maintaining its "Buy" investment rating. The previous day's closing price was 392,500 won.

The company is projected to record sales of 15.3768 trillion won and operating profit of 939.5 billion won for the fourth quarter of last year. Compared to the same period a year earlier, sales are expected to increase by 4.5%, while operating profit is projected to decrease by 4.7%. Compared to market consensus, sales are expected to fall short, but operating profit is likely to exceed expectations. The lower-than-expected finished vehicle shipments in the fourth quarter of last year are seen as the main reason for the sales shortfall.

On the other hand, the operating profit forecast has been revised upward from the previous estimate of 912.4 billion won. This is because various costs in the core parts division-including compensation for suppliers due to sluggish electric vehicle orders from client companies, tariff negotiations, and foreign exchange losses on raw material purchases settled with clients-are expected to be recovered all at once. As a result, consolidated quarterly operating profit is expected to reach its annual peak in the fourth quarter.

The after-sales (A/S) segment continued to recognize sales from inventory exported under the 25% U.S. tariff regime through the first quarter of 2026, despite the weak won in the fourth quarter. Therefore, margin improvement in the A/S segment for the fourth quarter of last year is not expected to be significant. Kiwoom Securities researcher Shin Yooncheol explained, "Hyundai Mobis has not yet raised A/S parts prices in the U.S. to pass on tariff costs, but is expected to begin partial price increases as early as the first quarter of this year to drive growth."

Hyundai Mobis is also expected to be re-evaluated as a core affiliate for the Hyundai Motor Group's new robotics business. Starting with humanoid joint actuators for Boston Dynamics, Hyundai Mobis is expected to expand its product portfolio as a robotics parts supplier, including grippers. However, there are concerns that sales could be limited to the Hyundai Motor Group's internal ecosystem. Researcher Shin analyzed, "If Hyundai Mobis can quickly demonstrate its capabilities for both product portfolio diversification and client diversification, its corporate value could see significant upside potential."