Daishin Securities on July 14 lowered its target prices for both Hyundai Motor and Kia, reducing the valuation of their robotics businesses amid weakening investment sentiment toward physical AI during a period of heightened global equity market volatility. Both stocks, however, retained their “Buy” ratings based on solid fundamentals and second-half catalysts in new vehicles and robotics.<\/p>\n
Daishin cut Hyundai Motor’s target price by 3.9%, from \u20a9770,000 to \u20a9740,000 (approximately $514.61 to $494.56). The recent sharp decline in the stock price is attributed more to a broad market correction than to deteriorating earnings. Hyundai’s share price has fallen approximately 64% from its year-to-date high. Kim Gwi-yeon, an analyst at Daishin Securities, explained: “Noise related to Boston Dynamics (BD) equity stakes and concerns over earnings weakness have dragged down the stock. However, since the market had rapidly priced in long-term growth prospects tied to robotics expectations since the beginning of the year, heightened share price volatility during the market correction was inevitable.”<\/p>\n
Kia’s target price was also trimmed modestly. Kim noted: “The target enterprise value of \u20a9104 trillion (approximately $69.5 billion) comprises \u20a999 trillion (approximately $66.2 billion) for the core automotive business, \u20a915 trillion (approximately $10.0 billion) for robotics, and \u20a93 trillion (approximately $2.0 billion) for SDV (software-defined vehicles). The target price adjustment reflects the robotics business valuation cut due to weakening physical AI momentum.”<\/p>\n
Second-Half Rebound Catalysts Remain Intact<\/p>\n
Daishin Securities identified key factors that could drive a Hyundai Motor share price recovery in the second half: improved earnings from new model launches\u2014including the Grandeur, Tucson, and Avante\u2014and base effects; a CEO Investor Day scheduled for August 26; the activation of the U.S. Robotics & Advanced Manufacturing Center (RMAC) in the third quarter; and a recovery in robotics investment sentiment.<\/p>\n
Kim assessed that “Hyundai Motor will continue to serve as the sector bellwether by leading the group’s physical AI business,” adding that the mid-to-long-term growth story remains unchanged.<\/p>\n
Kia was also presented as a stable investment from both earnings and shareholder return perspectives. Kim analyzed: “While Kia has been overlooked within the sector as Boston Dynamics-driven robotics momentum was priced in, its fundamentals\u2014including earnings and shareholder returns\u2014remain strong. The valuation discount relative to Hyundai has narrowed due to Hyundai’s share price correction, but Kia still trades at a roughly 40% discount to Hyundai.” Kim added: “Considering its solid earnings power, the group-wide physical investment and benefit structure, and shareholder return capacity underpinned by earnings strength, Kia’s investment appeal remains intact.”<\/p>\n
Second-Quarter Earnings: Near-Term Weakness Expected<\/p>\n
A somewhat conservative view was presented on near-term earnings. Daishin Securities estimates Hyundai Motor’s second-quarter revenue at \u20a948 trillion (approximately $32.1 billion) and operating profit at \u20a92.7 trillion (approximately $1.8 billion). These figures fall below market consensus, with sluggish sales and profitability erosion from expanded incentives in North America cited as contributing factors.<\/p>\n
Kia’s second-quarter results are expected to meet consensus. Revenue is projected at \u20a932 trillion (approximately $21.4 billion), up 10% year-over-year, with operating profit of \u20a92.7 trillion (approximately $1.8 billion), down 2%. The operating margin is estimated at 8.5%, with solid sales and favorable foreign exchange effects supporting healthy profitability.<\/p>\n
Below is a summary table of Daishin Securities’ second-quarter earnings forecasts and investment metrics for Hyundai Motor and Kia.<\/p>\n
CategoryHyundai MotorKiaQ2 Revenue Forecast\u20a948 trillion\u20a932 trillionQ2 Operating Profit Forecast\u20a92.7 trillion\u20a92.7 trillionOperating Margin ForecastNot provided8.5%Target Price (Adjusted)\u20a9740,000Separately disclosedInvestment RatingBuyBuyValuation vs. Hyundai-~40% discount<\/p>\n
Note: Daishin Securities did not disclose a separate target price for Kia but presented a target enterprise value of \u20a9104 trillion.<\/p>\n
Kim assessed Kia by stating: “While its relative strength as a robotics beneficiary within the sector may be lower, its appeal as a stable investment is high.” The view is that with both Hyundai Motor and Kia possessing future growth drivers in robotics and physical AI, the near-term share price correction could present a buying opportunity.<\/p>\n","protected":false},"excerpt":{"rendered":"Daishin Securities on July 14 lowered its target prices for both Hyundai Motor and Kia, reducing the valuation…\n","protected":false},"author":2,"featured_media":85605,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[21],"tags":[906,891,295,702,703,45513,1223,16741],"class_list":["post-85604","post","type-post","status-publish","format-standard","has-post-thumbnail","category-hyundai-motor","tag-boston-dynamics","tag-daishin-securities","tag-hyundai","tag-hyundai-motor","tag-kia","tag-kim-gwi-yeon","tag-physical-ai","tag-robotics-business"],"_links":{"self":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts\/85604","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/comments?post=85604"}],"version-history":[{"count":0,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/posts\/85604\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/media\/85605"}],"wp:attachment":[{"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/media?parent=85604"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/categories?post=85604"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.europesays.com\/korea\/wp-json\/wp\/v2\/tags?post=85604"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}