[Click e-Stock] "ISU Petasys: Next Year's Operating Profit Estimate Raised... Target Price Also Up"

Target Price Raised to 1.7 Million Won

On March 3, Meritz Securities maintained its buy rating on ISU Petasys and raised its target price to 1.7 million won.

Seungsu Yang, a research analyst at Meritz Securities, stated, "We have raised our operating profit estimate for next year by 13.3% from our previous forecast, reflecting the early securing of multi-layer production capacity." He noted that, although ISU Petasys’s stock has significantly underperformed the KOSPI index this year due to concerns over intensified competition within the tensor processor unit (TPU) value chain and continued valuation pressure since last year, "the eighth-generation TPU has been confirmed to use a multi-layer structure instead of HDI, which will help ISU Petasys maintain its strong technological competitiveness within TPUs."

As major clients are rapidly increasing their demand for multi-layer board (MLB) products, ISU Petasys has announced a new expansion plan that will move up some of its capacity expansion timeline. However, Yang emphasized, "Despite this capacity expansion, the supply-demand dynamic is expected to remain in favor of suppliers, as customers’ multi-layer demand will continue to exceed the planned capacity." He added, "From the second half of this year, multi-layer structures will be applied not only to AI accelerators for the company’s largest client, G, but also to switch products, which is expected to result in an average selling price (ASP) increase that exceeds expectations." Yang further stressed, "We believe the ASP increase effect from the expansion of ISU Petasys’s multi-layer product supply remains underestimated, and we maintain our view that the current share price represents an opportunity for both upward earnings revisions and multiple expansion as additional clients are secured."

This content was produced with the assistance of AI translation services.