[Click e Stocks] 'NCSoft' Target Price Downgraded

[Asia Economy Reporter Hwang Junho] Meritz Securities lowered the target price of NCSoft to 920,000 KRW on the 6th. They anticipated that the initial performance of 'Blade & Soul 2' was weaker than expected, which would impact earnings. However, they forecast that earnings growth and corporate value would recover through new releases such as Lineage W in November.

NCSoft's stock price has fallen 36.4% compared to the beginning of the year, underperforming the KOSPI by 45.1 percentage points. The underwhelming performance of Blade & Soul 2, released on the 26th of last month, the boycott movement against 'Lineage' triggered by the Munyang rollback issue since the start of the year, the changed sentiment of gamers tired of win-to-pay models, and the emergence of various investment alternatives in the gaming sector such as Krafton, Pearl Abyss, and Kakao Games (Lion Heart) are analyzed as factors affecting this trend.

However, the domestic Google Play game revenue ranking of Blade & Soul 2 has gradually risen to 7th on the 28th of last month, 4th on the 30th, and 3rd on the 2nd of this month. NCSoft is actively reflecting gamers' demands by removing the 'Younggi' system. The showcase and pre-registration for Lineage W have also started, with a release scheduled for November. Next year, the PC game 'Project TL' and a new mobile game 'Aion 2' are set to be released.

Kim Donghee, a researcher at Meritz Securities, explained, "Due to the underperformance of Blade & Soul 2 compared to expectations, we have lowered the sales and operating profit estimates for next year by 7.8% and 10.7%, respectively, to 2.99 trillion KRW and 910.7 billion KRW, and adjusted the target price downward." He added, "We can expect earnings growth and corporate value recovery through new releases in the future."

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