Samsung Electronics (SSNLF) shares were up in 1% in ordinary trading in Seoul today after the company early this morning said that it met the mid-point of its forecast range for Q4 sales and beat analysts’ estimates for revenue and profit.
Revenue in the three months ended in December rose to 47.3 trillion Korean Won, up 13%, year over year, and within the forecast range of 46 trillion to 48 trillion the company announced back on January 6th. The company’s operating profit of 5.3 trillion Won was toward the high end of the range that had been offered of 5 trillion to 5.4 trillion.
Analysts had been modeling 46.9 trillion in revenue and 4.65 trillion in operating profit. Note that the results were boosted by the one-time receipt of payment for Samsung’s hard drive business, which was sold to disk-drive maker Seagate Technology (STX).
Results were driven by smartphones and displays, with the telecom products group seeing a 52% jump in sales, year over year, and a 19% jump in display products group revenue. (Details of the quarter are in the company’s slide deck, here.)
Sanford Bernstein’s Mark Newman this morning reiterated an Outperform rating on the ordinary shares of Samsung, calling the results “stellar.”
Newman estimates that the company slightly improved its profit margin in sales of LCD displays, and that revenue from active matrix organic light-emitting diode (AMOLED) displays continued to rise off of a small base, though it incurred higher costs as a result of “technology migration.”
As for the phone business, it beat his expectations:
Handsets delivered revenues of KRW 17.2T, ahead of our estimate of KRW 16.9T, on the back of strong QoQ growth in smartphone shipments. The company reported a stellar 30% increase in shipments, to ~36.5 M units in Q4, rivaling Apple and expanding its gap with its Android competitors. – Blended handset ASPs continue to improve as the mix increases more towards smartphones. The company noted increased marketing spending in the 4Q due to seasonal effects, which acted as a slight headwind to margin, but mentioned that generally SG&A spending will not grow as fast as the rate of gross margin increa
Newman has a 1.5 trillion Won target price on the stock.
Previously: Apple iPhone Beats Samsung By a Nose in Q4, January 27th, 2012.
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