[Click eStock] "LG Display Expected to Miss Q3 Estimates... Target Price Lowered"

On September 17, Daishin Securities revised its target price for LG Display downward from 17,000 won to 12,000 won, anticipating that the company’s third-quarter results for this year would fall short of market expectations. The investment rating was maintained as ‘Buy’.

Daishin Securities estimates that LG Display will post an operating profit of 325.3 billion won in the third quarter, which is below the consensus (the average estimate by securities firms) of 404.5 billion won. Revenue is also projected to reach 6.67 trillion won, lower than the consensus estimate of 6.91 trillion won. Analyst Park explained, “The underperformance and weakness in operating profit were mainly due to the average won-dollar exchange rate (as of the 15th), which declined by 4.6% compared to the previous quarter and by 12.7% compared to the end of June, putting pressure on profitability. Additionally, rising prices of semiconductors and major raw materials have driven up the sales prices of IT devices. This is analyzed as having been affected by weakening demand.”

While an increase in North American strategic client demand for mobile OLED panels and a greater proportion of premium models are expected to generate a positive product mix effect, rising memory prices have led to higher sales prices for smartphones, tablet PCs, and laptops, which in turn have burdened the profitability of parts suppliers. This is attributed to the slowdown in demand for key IT devices and falling margins (as the rise in raw material prices was only partially reflected in the supply prices for smartphones, TVs, PCs, and tablet PCs).

Daishin Securities also revised LG Display’s 2026 earnings per share (EPS) forecast to remain in the red and lowered its 2027 EPS estimate by 45% compared to the previous projection.

They maintain a positive view on the mid- to long-term improvement in profitability. Annual operating profit is expected to expand to 670.7 billion won in 2026 and 1.06 trillion won in 2027, following the return to profit last year. Analyst Park stated, “In the mid- to long-term, the uptrend in profitability remains intact, driven by increases in market share with major North American clients, lower depreciation costs for large-sized OLED panels, and a higher proportion of OLED revenue. Furthermore, as North American strategic clients move their smartphone launch strategy to both halves of the year, the impact of the off-season is likely to be minimized in the first half of 2027, which should help ease fixed cost burdens and further improve profitability.”

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