LIG Nex1 stock: Samsung Securities halves target after weak quarter

Samsung Securities lowered its target price for LIG Defense & Aerospace, formerly known as LIG Nex1, on November 9 after delayed export orders and weaker-than-expected third-quarter results. The analysis was reported by Financial News.

Export timing weighs on expectations

Samsung Securities analyst Han Young-soo cut the target price to KRW 430,000 from KRW 855,000 and kept a Buy rating. The report said third-quarter operating profit was KRW 68 billion, 34.6% below market expectations.

Han said the large orders needed to match expectations built around geopolitical tensions had not yet materialized. He also identified uncertainty over possible sanctions by South Korea's Defense Acquisition Program Administration as a risk to the outlook.

Valuation remains the counterpoint

The analyst argued that the recent share-price decline had already reflected a substantial portion of the negative news. He added that the company's valuation remained discounted against the average for domestic and overseas peers even after the earnings outlook was reduced.

Defense portfolio spans major domains

LIG Nex1 develops defense and security systems for guided munitions, maritime operations, intelligence and surveillance, command and control, avionics, drones and electronic warfare. Its portfolio also includes unmanned and future-warfare solutions. Compared with broader Korean defense groups such as Hanwha Aerospace, Hyundai Rotem and Korea Aerospace Industries, LIG Nex1 is positioned as a specialist in precision weapons and related defense electronics rather than a diversified platform manufacturer.

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