[Click eStock] "Com2uS, Summoners War New Release Imminent... Target Price Up 40%"

NH Investment & Securities Report

[Asia Economy Reporter Minji Lee] NH Investment & Securities maintained a buy rating on Com2uS on the 15th and raised the target price by 40% from the previous level to 210,000 KRW. This adjustment was made due to the upward revision of earnings estimates following the release of new games.

Ahn Jae-min, a researcher at NH Investment & Securities, stated, "With the imminent release of 'Summoners War: Hundred Years' War,' the launch of 'Summoners War: Chronicle' in the second half of the year is expected to reflect both earnings growth and new product momentum."

Summoners War: Hundred Years' War received favorable reviews during its closed beta test in November last year and is scheduled for release in March. As Summoners War enters its seventh year, it currently ranks within the top 100 in sales on the Apple App Store across 61 countries globally, which is expected to raise anticipation for the sequel.

The release of Summoners War: Chronicle, a new mobile game utilizing the Walking Dead IP, is also highly anticipated. Additionally, the launch of 'OOTP Baseball 22' by the subsidiary OOTP, acquired last year, is expected.

This year, sales are projected to reach 661 billion KRW, and operating profit is estimated at 171.8 billion KRW, representing growth of 29.8% and 46.1% respectively compared to the same period last year. Researcher Ahn Jae-min explained, "If this new release succeeds, it will capture both earnings growth and valuation increase," adding, "Despite the recent stock price rise, Com2uS's price-to-earnings ratio (PER) based on this year’s earnings is 14.6 times, which is lower than NCSoft (20.8 times) and Pearl Abyss (23.6 times)."

Fourth-quarter sales last year are estimated at 135.1 billion KRW, and operating profit at 29.5 billion KRW, marking increases of 5.4% and 12% respectively from the previous quarter. Operating profit is expected to slightly miss the market estimate of 32.9 billion KRW. Researcher Ahn Jae-min noted, "Due to increased marketing expenses related to hosting the Summoners War World Arena Championship (SWC) 2020, reduced revenue recognition from exchange rate declines, and performance bonuses, profit growth is expected to increase only slightly compared to the previous quarter."

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