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[Alpha Biz=(Chicago) Reporter Paul Lee] NH Investment & Securities Co. maintained its target stock price of 38,000 won for Samsung Engineering on Jan. 31, saying it expects external growth due to diversification of projects into non-fossil fuels this year. Investment opinions also maintained a 'buy'. Samsung Engineering's stock price is 24,050 won based on the closing price of the previous trading day.
"This year's share price earning ratio (PER) is seven times and valuation attractiveness is sufficient," NH Investment & Securities said. "If the current real estate market situation continues, housing-oriented construction companies will maintain Samsung Engineering as the most preferred stock in the industry."
Samsung Engineering's order target for this year is 12.6 trillion won, and its sales and operating profit targets are 10 trillion won and 800 billion won, respectively. Major projects include Saudi Arabia's Aramco Pad Hilli ($4 billion in the first and fourth quarters), Saudi SAN6's Blue Ammonia ($2 billion in the first half), Malaysia's OPG2 ($1.5 billion in the second half) and Saudi Arabia's Alujahin PDH and PP ($2 billion in the second half).
In the fourth quarter of last year, Samsung Engineering's sales fell 4% year-on-year to 2.8 trillion won, but its operating profit rose 26% to 269.9 billion won. Researcher Lee said, "This is because settlement gains and losses occurred 70 billion won and 15 billion won, respectively, in chemical and non-chemical industries in the final stage project."
Alphabiz Reporter Paul Lee(hoondork1977@alphabiz.co.kr)
