iM Securities positively assessed LG Innotek on the 27th, noting that its stock price is low while its performance is good, and it has upcoming events with key client Apple in the United States. iM Securities maintained a 'buy' investment opinion on LG Innotek and raised the target price from 205,000 won to 225,000 won, which is about 39% higher than LG Innotek's previous close of 161,600 won.
Ko Ui-young, a researcher at iM Securities, assessed that LG Innotek's current stock price reflects the worst-case scenario. LG Innotek's 12-month forward price-to-book ratio (PBR, market capitalization ÷ net worth) is 0.7 times, which is below the average of the last 10 years. The price-to-earnings ratio (PER, market capitalization ÷ net income) is also at 8 times, which is a 23% discount compared to the average of the last 10 years.
According to Ko, the researcher, as the stock price is low, it can react more to positive news than negative news. First, the market's lowered expectations regarding LG Innotek's performance could actually present an opportunity.
Ko projected that LG Innotek's first-quarter (January to March) performance will be a revenue of 4.6 trillion won and an operating profit of 114.3 billion won, which is over 30% higher than the market expectation of an operating profit of 88 billion won.
Ko noted, “Although the demand for the iPhone is sluggish, LG Innotek is performing well compared to lowered expectations,” adding, “In particular, the sales ratio of the Pro and Pro Max models among the iPhone 16 series has positively impacted LG Innotek's average selling price (ASP) for camera modules.”
Apple's events will continue. This month marks the start of the iPhone 16e launch, followed by Apple's global language support in April and the Worldwide Developers Conference (WWDC) in June.
Ko remarked, “We will be able to confirm the next artificial intelligence (AI) strategy through WWDC,” noting, “Last year, sales forecasts for the iPhone were revised upward around the time of WWDC.” He continued, “The new iPhone model in 2026 is expected to undergo functional changes in its main camera, and LG Innotek is projected to recover its prices and market share.”