Samsung Biologics Earnings: We Slightly Lift Our Valuation on New Guidance; Shares Still Overvalued

We slightly raise our fair value estimate for narrow-moat Samsung Biologics to reflect the lift in management guidance. Although third-quarter revenue growth of 14.8% year over year was in line with our expectations, we increase our annual revenue growth forecast to 20.2% from 18.8% as we expect a stronger fourth quarter due to the new fourth plant ramping up capacity. Hence, our fair value estimate rises to KRW 733,500 per share from KRW 709,800. This indicates a price/book ratio of approximately 5 times and 2024-25 price/earnings of around 50 times. We continue to see the shares as overvalued and think investors should wait for a better entry point.