Kyobo Securities raises Samsung Electro-Mechanics target price to 3 million won on MLCC shortage and FCBGA price hikes

Kyobo Securities anticipates a substantial performance boost for Samsung Electro-Mechanics, driven by escalating demand for components used in AI servers. The firm has significantly increased its target price for the company's stock to 3 million won, up from the previous 1.2 million won, while reaffirming its 'BUY' investment recommendation.

Analysts project Samsung Electro-Mechanics' second-quarter revenue to reach 3.4084 trillion won. This represents a 22.4% increase compared to the same period last year. The operating profit is also expected to surge by 93.0% year-on-year, reaching 411 billion won.

The positive outlook is attributed to the growing need for critical components like MLCC (Multi-Layer Ceramic Capacitor) and FCBGA (Flip-Chip Ball Grid Array), with the company potentially implementing price hikes for the latter due to supply shortages. This strategic positioning in high-demand sectors is expected to solidify Samsung Electro-Mechanics' market standing and financial performance.