Shares of LG Energy Solution, a leading South Korean electric-vehicle battery maker, experienced a significant surge in value following the release of its preliminary third-quarter earnings forecast that surpassed market expectations.
LG Energy Solution's stock witnessed a remarkable increase of up to 8.3%, reaching 496,500 won ($369.79) during early trade on Wednesday. This surge marks the largest daily percentage gain in 20 months, outperforming the benchmark Kospi's growth of 2.5%, as reported by FactSet.
The positive market response was triggered by LG Energy Solution's announcement that it anticipates a 40% year-on-year jump in operating profit for the July-September quarter, amounting to KRW731.20 billion. This outlook significantly surpasses the market consensus forecast of KRW649.65 billion compiled by FactSet. It is important to note that the company's preliminary quarterly operating profit includes an estimated KRW215.5 billion derived from U.S. tax credits made available under the Inflation Reduction Act.
Furthermore, LG Energy Solution anticipates a 7.5% year-on-year increase in third-quarter revenue, forecasting it to reach KRW8.224 trillion.
The impressive forecast has positioned LG Energy Solution as a crucial EV battery supplier to renowned global car manufacturers, including General Motors.
In summary, LG Energy Solution's remarkable third-quarter earnings forecast has propelled its shares to soar, demonstrating the company's substantial growth potential and solidifying its position in the electric vehicle industry.
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