Hyundai Motor Securities projected on the 27th that Samsung SDS's operating profit for the fourth quarter of this year would fall 10% short of market expectations, resulting in a poor performance. Consequently, it maintained its investment rating as 'buy' but lowered the target price to 180,000 won, a 10% decrease. In the previous transaction, Samsung SDS closed at 129,300 won.
According to Hyundai Motor Securities, Samsung SDS's revenue for the fourth quarter is expected to reach 3.6234 trillion won, a 7.3% increase compared to the same period last year, while operating profit is projected to rise by 5.0% to 225.2 billion won. This figure falls 10% short of market expectations.
Samsung SDS also presented conservative business targets for next year. The company's revenue target for next year is 14.4 trillion won, and operating profit is expected to exceed 930 billion won. This represents a conservative guidance corresponding to a 4.3% increase in revenue and a 0.6% increase in operating profit compared to this year's projections.
Kim Hyun-yong of the Research Institute at Hyundai Motor Securities noted, 'The poor performance in IT services is expected to be the cause of the slowdown in profit growth,' adding, 'The operating profit margin for IT services is projected to decrease slightly to 11.4% compared to the same period last year, which is attributed to an increase in solution development expenses.'
In this context, Kim stated, 'We are lowering the target price for Samsung SDS to 180,000 won, a 10% decrease from our previous estimate, due to adjustments in the fourth-quarter and next year's performance projections based on market conditions,' adding that 'it is difficult to expect a trend rebound, but the possibility of additional shareholder return measures along with dividends around January could be a positive factor.'