Hana Securities reiterated a "buy" rating and a 12-month price target of ₩150,000 on RFHIC (KOSDAQ: 218410) on 2nd September 2026, implying upside of 233% from the stock's close of ₩45,000 on 1st September.
Sharp growth expected in the third quarter
The brokerage forecasts third-quarter consolidated revenue of ₩69bn, up 70% year on year and 34% quarter on quarter, with operating profit of ₩15.3bn, up 107% year on year and 37% quarter on quarter. A key factor is the recognition of defence-related revenue from Raytheon, which had been deferred into the third quarter.
The scale of the projected earnings recovery is striking. RFHIC posted a full-year operating profit of just ₩1.5bn in 2024. Hana Securities estimates that figure will surge to ₩30.9bn in 2025, then climb further to ₩54.2bn in 2026 and ₩75.3bn in 2027 — a more than fiftyfold increase over three years. Revenue is expected to roughly treble over the same period, from ₩114.9bn in 2024 to ₩318bn in 2027.
Telecoms as the main growth engine
The principal driver of that growth is the telecommunications segment. In the United States, an upper C-band spectrum auction has been confirmed for April 2027. In South Korea, the rollout of standalone 5G (5G SA) networks is scheduled for late 2026. RFHIC is widely expected to supply components to Verizon via Samsung, and stands to benefit further if domestic 5G investment accelerates.
Hana Securities places particular emphasis on a potential supply shortage in telecoms transistors in 2027. NXP Semiconductors has exited its telecoms business, and tightening American restrictions on Chinese equipment and components have sharply reduced the number of available suppliers. At the same time, demand is rising quickly, propelled by new spectrum investment in the United States and the 5G SA build-out in Korea. The brokerage points to past episodes — the introduction of LTE in 2012, the 5G rollout in 2019, and the recent fibre-optic boom — as precedents in which telecoms equipment valuations spiked sharply during periods of supply scarcity.
Reasons for scepticism
Investors should not accept this optimistic assessment without scrutiny. On current estimates, RFHIC trades at 30.83 times forecast 2026 earnings — already elevated relative to sector peers, on Hana Securities' own figures. A target price more than three times the current share price implies considerable downside risk if earnings growth falls short of projections.
The share price itself tells a cautionary tale. RFHIC has fallen nearly 60% from its 52-week high of ₩112,500. Hana Securities attributes this to a temporary deterioration in trading flows during June and July, but whether the underlying causes of that weakness have been resolved is not yet clear.
The key assumptions underpinning the earnings forecasts also remain unconfirmed. The Verizon supply arrangement and the domestic 5G SA timetable are described as "likely" or "scheduled" rather than contracted. Any delay or shortfall in orders could unravel the entire earnings model.
The trajectory of Hana Securities' own target price revisions invites scrutiny too. The brokerage raised its target from ₩60,000 in January 2026 to ₩80,000 at the end of January, then to ₩100,000 in March, and again to ₩150,000 on 31st March — four upgrades in the space of three months. Rapid target-price revisions can signal improving earnings visibility, but they equally reflect the scale of remaining uncertainty. Historical accuracy provides further grounds for caution: when Hana Securities set a target of ₩40,000 in September 2023, the average gap between that target and the actual share price reached –60.89%.
Company background
RFHIC is a KOSDAQ-listed manufacturer of gallium nitride (GaN)-based high-power semiconductor devices. The company's largest shareholders are its chief executive, Deok-su Cho, and related parties, who together hold a 33.48% stake. Samsung Asset Management owns 5.87%, and foreign investors account for 22.22% of the share register. The company's market capitalisation stood at approximately ₩1.2trn as of 1st September.