LG Display Co Ltd (LPL, Financial) has recently seen a notable uptick in its stock performance, with a 4.36% gain over the past week and an impressive 10.55% gain over the past three months. The company's market capitalization stands at $3.81 billion, and the recent price of $5.33 reflects a positive trajectory for the stock. When compared to the GF Value of $5.55, LG Display is currently considered fairly valued, a shift from its previous status as modestly undervalued when the GF Value was at $5.86 three months ago.
Introduction to LG Display Co Ltd
LG Display Co Ltd operates within the competitive hardware industry, specializing in the manufacture and sale of TFT-LCD and OLED display panels. The company boasts a diverse product range that includes panels for various electronic devices such as notebook computers, monitors, televisions, smartphones, and tablets. With a strong global sales network that extends to the United States, Germany, Japan, Taiwan, China, and Singapore, LG Display has established a significant presence in the international market, deriving the majority of its revenue from these overseas markets, complemented by domestic sales in South Korea.
Assessing LG Display's Profitability
LG Display's Profitability Rank stands at 5/10, indicating a moderate level of profitability within the industry. The company's operating margin is currently at -15.55%, which, despite being negative, fares better than 15.86% of 2,452 companies in the same sector. The ROE (Return on Equity) is deeply negative at -50.36%, yet it still outperforms 6.2% of its peers. Similarly, the ROA (Return on Assets) and ROIC (Return on Invested Capital) are negative at -12.51% and -9.12% respectively, but these figures are better than those of a significant number of competitors. Over the past decade, LG Display has managed to maintain profitability for 6 years, which is more consistent than 37.73% of companies in the industry.
Growth Prospects of LG Display
The company's Growth Rank is currently at 3/10, reflecting a lower growth trajectory in comparison to industry peers. The 3-year revenue growth rate per share stands at 3.70%, which is better than 47.09% of companies. However, the 5-year revenue growth rate per share is a meager 0.50%, surpassing 40.71% of competitors. Looking ahead, the estimated total revenue growth rate for the next 3 to 5 years is projected at -6.47%, which, while negative, is still better than 3.5% of the industry. The 3-year EPS without NRI (Net Recognizable Income) growth rate is at -14.70%, indicating challenges in maintaining earnings growth.
Market Position and Competition
When examining LG Display's market position, it's important to consider its competitors. Yujin Robot Co Ltd (XKRX:056080, Financial) has a market cap of $318.789 million, Paseco Co Ltd (XKRX:037070, Financial) is valued at $157.628 million, and Spigen Korea Co Ltd (XKRX:192440, Financial) comes in at $149.574 million. These companies, while smaller in market capitalization, represent the competitive landscape in which LG Display operates.
Conclusion
In summary, LG Display Co Ltd's recent stock performance has been positive, with a significant gain over the past three months. The company is currently fairly valued according to the GF Value, with a shift from its previous modestly undervalued status. While profitability remains a challenge, with negative margins and returns, LG Display has managed to outperform a portion of its competitors. Growth prospects appear limited, with low growth rates and a negative outlook for future revenue. However, the company's strong global presence and consistent profitability over the past decade provide a foundation for potential improvement. As investors consider LG Display's position relative to its competitors, the company's ability to innovate and adapt to market demands will be crucial in determining its future success.
This article, generated by GuruFocus, is designed to provide general insights and is not tailored financial advice. Our commentary is rooted in historical data and analyst projections, utilizing an impartial methodology, and is not intended to serve as specific investment guidance. It does not formulate a recommendation to purchase or divest any stock and does not consider individual investment objectives or financial circumstances. Our objective is to deliver long-term, fundamental data-driven analysis. Be aware that our analysis might not incorporate the most recent, price-sensitive company announcements or qualitative information. GuruFocus holds no position in the stocks mentioned herein.
