Goldman Sachs on SZS (3376.TW): Foldable iPhone to Drive Future Growth; Buy Reiterated, Target Price Raised to NT$300
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Goldman Sachs reiterates Buy on SZS (3376.TW), raising the 12-month target price from NT$286 to NT$300, applying 21.9x 2027E P/E (up from 21.0x) and implying 63.9% upside from the September 11, 2026 close of NT$183. The firm views SZS—a leading global hinge supplier to Apple MacBooks and iMac displays, expanding from notebook and wearable hinges into foldable phones—as a core beneficiary of the newly launched foldable iPhone (iPhone DUO), which features a novel form factor and accessible pricing from US$1,999. A foldable iPhone hinge contains more than 100 micro precision parts with high dollar content per unit, and SZS has accumulated R&D know-how, capacity expansion and in-house MIM processes. Goldman expects global foldable smartphone penetration to rise from 1.6% in 2025 to 3.6%/5.9%/6.8% in 2026E/27E/28E. Near term, August revenue of NT$820m fell 10% YoY (+1% MoM), 38% below Goldman's estimate on soft wearable and NB hinge growth. The 21.9x multiple derives from the industry correlation between P/E and 2027–28E EPS growth and sits within SZS's trading range since August 2019. Key risks: weaker headset hinge demand, slower foldable penetration, added competition and soft end demand.
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