DOHOME Jumps 14% to ฿24.7, Analysts Upgrade TP to ฿26 in Expectation of Strong 1Q Result

The share price of Dohome Public Company Limited (DOHOME) rose฿3.00/shareor 13.82%to ฿24.70/share as of 15:20 local time in Thailand, with a trading value of 600 million baht. 

KTBST Securities (KTBST) maintained a “BUY” rating on DOHOME but raised a target price to ฿26.00/sharefrom ฿20.00/share while maintaining 2021E PER multiples at 37x (its peers’ average level of 33x). 1Q21E net profit is expected to surge +127% YoY, +86% QoQ to a record high of 401 million baht in expectation of higher revenue and stronger same-store-sales growth and profitability. 

Total revenue is forecasted to jump +31% YoY, +24% QoQ to 6.00 billion baht, marking a record high, on the back of an opening of a large format store at Laemchabang in late January. Same store sales are projected to grow significantly +20% YoY. Gross profit margin is predicted to widen to a record high of 20.8%, compared to 17.5% in 4Q20 and 15.4% in 1Q20, on a lower cost of goods following an establishment of a new distribution center, and the company’s effective product mix strategy, focusing on repairing products and strong profit-margin house brand products. Note that a continued increase in steel price is also a factor driving DOHOME’s operating performance

Kasikorn Securities (KS) has given a “BUY” recommendation on DOHOME and a target price of฿21.50/share, expecting same store sales growth (SSSG) of 20% YoY in 1Q21, driven by rising demand in construction materials and a positive fundamental last year.

EPS growth is estimated at 27.3% and 23.9% CAGR in 2021-23E, respectively.