[Edaily Reporter Park Jeong-soo] On the 9th, Daol Investment & Securities maintained its “Buy” rating and target price of 100,000 won for #Hankook Tire & Technology, stating that the stock has entered a phase of excessive undervaluation. The previous day’s closing price was 67,000 won.
Yoo Ji-woong, an analyst at Daol Investment & Securities, analyzed, “The decline has been excessive, with the relative return compared to the KOSPI reaching -62.7% since the beginning of the year,” adding, “Considering its solid profitability, strengthened shareholder return policies, and the possibility of price hikes in the second half of the year, a meaningful revaluation is possible.”
Daol Investment & Securities noted that Hankook Tire plans to raise its total shareholder return (TSR) target for this year from 25% to 35% and will pay its first interim dividend. With a current dividend yield of around 3.7%, the company is seen as offering a high level of shareholder returns even within the automotive and tire sectors.
The firm also viewed earnings momentum as robust. Daol Investment & Securities projected a second-quarter operating profit margin of around 16%, expecting the company to reaffirm its unrivaled profitability among global tire manufacturers. It estimated this year’s revenue at 22.0421 trillion won, a 5.7% increase year-over-year, and operating profit at 2.081 trillion won, a 13.0% increase.
The firm projected that the effects of price hikes would become fully evident in the second half of the year. Analyst Yoo explained, “The burden of rising raw material costs, such as butadiene, since the beginning of the year will be passed on through additional price increases in the second half,” adding, “The strategy to expand profits through higher average selling prices (ASP) will continue.”
He also cited benefits from the European market as a key factor. “With the Tennessee plant coming online in the second half and the impact of European anti-dumping duties, the company will possess the strongest profit resilience among domestic tire manufacturers,” he assessed, adding, “Lower tariffs compared to Chinese competitors in the European imported tire market will highlight its competitive advantage.”
He further noted, “The current stock price is trading at a 2026 forward price-to-earnings (P/E) ratio of 6.6 times,” adding, “Considering strengthened shareholder returns and improved performance, the valuation is sufficiently attractive.”