[Featured Stock] S-Oil Weakens on Q3 Loss Forecast... New Low

S-Oil is showing weakness as its third-quarter performance is expected to be poor this year. It recorded a 52-week low during the trading session.

As of 9:27 a.m. on the 4th, S-Oil is trading at 60,900 KRW, down 1,300 KRW (2.09%) from the previous day. It fell to 60,500 KRW during the session, breaking its 52-week low.

The forecast of a return to a loss in the third quarter appears to have negatively impacted the stock price. On the previous day, Hanwha Investment & Securities projected that S-Oil would post an operating loss of 21.7 billion KRW in the third quarter, significantly missing the current consensus (average securities firm forecast) of 349.3 billion KRW. Yoon Yong-sik, a researcher at Hanwha Investment & Securities, explained, "The poor third-quarter performance is expected because, despite the seasonal peak, a decline in oil prices will lead to an inventory valuation loss (111 billion KRW), while the improvement in refining margins is expected to fall short, resulting in an expanded deficit in the refining sector." Hanwha Investment & Securities lowered S-Oil's target price by 12%, from 85,000 KRW to 75,000 KRW, reflecting downward revisions in earnings estimates due to the sluggish industry conditions.

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