Largan Precision Co Ltd

3008: XTAI (TWN)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	TWD 4,955.00	Mtcrcqc	Xqfkggwy

Largan Earnings: Short-Term Boosts Not Enough to Convince Us of Further Upgrades

Phelix Lee

Jul 12, 2024

We retain our fair value estimate on Largan at TWD 3,000 after the unsurprising second-quarter earnings. While we have revised up 2024 to 2028 net profit estimates by 10% to 20% compared with our January figures, they are primarily from weaker TWD and higher interest income. Other operating metrics are little changed. Largan looks fairly valued as we see smartphone camera upgrades remain slow and have become focused on niche applications. Shares have priced in Largan’s pricing power backed by its unparalleled lens offering. We believe short-term stocking demand for fourth-quarter flagships may lead to the stock overshooting.

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