Simtech shares surged more than 13% intraday, as investors appeared to respond to upbeat brokerage outlooks and a string of higher price targets.
According to the Korea Exchange, Simtech was trading at 106,900 won as of 1:50 p.m. on the 7th, up 13,100 won, or 13.97%, from the previous session.
Daishin Securities said in a report that earnings improvement should begin in earnest, driven by expanding sales of server memory modules and SOCAMM2. It maintained its “buy” rating and raised its target price to 105,000 won from 60,000 won.
Park Kang-ho, an analyst at Daishin Securities, said Simtech is estimated to have the largest share of SOCAMM2 supply among the three major memory makers. He added that operating margin gains should continue as the company increases the share of higher-profit products.
Daishin Securities expects the pace of improvement to accelerate in the second quarter after gains in the first. It estimated second-quarter operating profit at 40.2 billion won, up 193% from the prior quarter.
NH Investment & Securities also raised its target price to 120,000 won from 66,000 won. Hwang Ji-hyun, an analyst at NH Investment & Securities, said the revision reflected a rise in the sector’s average valuation multiple, from 21 times to 27 times.
Hwang said margin improvement is progressing faster than expected as price increases and stabilizing raw material costs take effect. She added that the firm expects upward revisions to full-year results and further profitability gains on the back of expanding demand centered on SOCAMM and FC-CSP.
Shinhan Investment Corp. raised its target price to 150,000 won from 120,000 won, and iM Securities lifted its target to 135,000 won from 105,000 won.
* This article has been translated by AI.
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