[Click eStock] "CJ ENM, Q1 Earnings Expected to Be Weak... Entering Buy Zone"

Ebest Investment & Securities Issues 'Buy' Rating and 150,000 KRW Target Price... Closing Price on 12th at 102,900 KRW

[Asia Economy Reporter Kum Boryeong] Amid expectations of weak first-quarter earnings for CJ ENM this year, an analysis has emerged suggesting that now is a buying opportunity.

According to Ebest Investment & Securities on the 13th, CJ ENM's first-quarter earnings are estimated at 844.4 billion KRW in sales and 51.4 billion KRW in operating profit, representing decreases of 1.8% and 35% respectively compared to the previous year. Despite challenging conditions in TV advertising and content industries, the media segment is expected to achieve slight growth in both scale and profit. On the other hand, the film segment is likely to return to a loss as there are no other overseas sales performances besides "Parasite." The music segment is also facing inevitable profit decline due to one-time cost issues related to the Produce controversy.

The commerce segment remains a profit pillar, and there is still optimism for media's strong performance and entertainment's recovery. Kim Hyunyong, a researcher at Ebest Investment & Securities, stated, "Commerce is expected to account for 60% and media 30% of operating profit this year. Although growth is absent, commerce will serve as a profit pillar, media will achieve double-digit profit growth, and entertainment is expected to regain profit strength." He added, "Media's subsidiary-produced blockbuster drama 'The King: Eternal Monarch' will air in the second quarter, and as confirmed in the Tving spin-off disclosure, the digital high-growth strategy remains effective. Entertainment saw IZ*ONE successfully comeback in February, and in March, the debut single of Produce Japan's debut group JO1 sold 300,000 copies, establishing their position in the market."

Ebest Investment & Securities has issued a "Buy" rating for CJ ENM. The target price was lowered by 25% to 150,000 KRW. The closing price on the 12th was 102,900 KRW. Researcher Kim said, "We have entered an active buying phase. We maintain a strong buy opinion on CJ ENM," and analyzed, "This is an opportunity to purchase a major comprehensive media stock at a low price."

This content was produced with the assistance of AI translation services.