[Click e-Stock] "Classys Needs Short-Term Expectations Recalibration... Target Price Lowered"

On July 23, Samsung Securities announced that it is necessary to recalibrate short-term expectations for Classys and lowered its target price from 76,000 won to 70,000 won. The investment rating was maintained at 'Buy.'

Donghee Jeong, an analyst at Samsung Securities, explained, "It is a period in which short-term expectations need to be adjusted. We have lowered our operating profit estimates for 2026 and 2027 by 7.2% and 7.3%, respectively, compared to previous forecasts, and set a target price of 70,000 won. However, the earnings rebound momentum remains valid in the second half of the year and beyond."

Classys’s results for the second quarter of this year are expected to fall short of market expectations. Analyst Jeong forecast, "Second-quarter revenue is projected to reach 105.7 billion won, up 26.9% year-on-year, and operating profit is expected to increase by 11.4% to 47.9 billion won, both below consensus (the average forecast by securities firms)." He analyzed, "While overseas equipment and consumables have grown together, led by exports to the United States ('Quadse') and 'Volumumer,' as well as 'Shringk' devices to Thailand and Russia on the back of favorable exchange rates, a base effect from last year's robust 'Lifot' sales and sluggish domestic consumables, which have been left out of the growth in medical tourism, have continued." Equipment exports are expected to reach 42.7 billion won, a 30% increase year-on-year; consumables exports are projected at 28 billion won, up 38.9%; while domestic equipment and consumables are estimated at 7 billion won and 14.9 billion won, down 44.4% and 1.3%, respectively.

Results are expected to rebound in the second half of the year. Analyst Kim commented, "The anticipated regulatory approval for Volumumer in China in December and pre-approval partner contracts will serve as leading momentum. In Brazil, if monthly sales recover with the stabilization of production management integration (PMI), second-half contributions will expand. The gap in domestic new product launches will be addressed by diversifying the use of the existing platform, such as introducing new procedures that combine cartridges and ampoules." He added, "Notably, with the appointment of the new CEO, Juno Yoon, who previously led Harman's acquisition and PMI at Samsung Electronics, synergy enhancement and a potential re-rating (revaluation) are expected through vertical integration of the value chain, as well as the additional launch of two home beauty devices within the year."

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