[Special Stock] NCSoft Falls 5% on Earnings Below Expectations

[Asia Economy Reporter Kwon Jae-hee] NCSoft is experiencing a sharp decline in the early trading session on the 16th due to poor earnings performance.

As of 9:30 AM on the same day in the KOSPI market, NCSoft is trading at 485,500 KRW, down 5.36% from the previous day.

NCSoft, which announced its earnings the previous day, reported a consolidated operating profit of 375.2 billion KRW for last year, a 54.51% decrease compared to the previous year (2020).

Operating profit for the fourth quarter of last year was 109.5 billion KRW, down 30.15% year-on-year.

Due to earnings falling short of market expectations, securities firms have collectively lowered their target prices for NCSoft.

Hanwha Investment & Securities downgraded its investment opinion on NCSoft from 'Buy' to 'Hold' and significantly lowered the target price from 900,000 KRW to 580,000 KRW.

Samsung Securities lowered the target price from 900,000 KRW to 600,000 KRW, Daishin Securities from 790,000 KRW to 670,000 KRW, Hyundai Motor Securities from 900,000 KRW to 740,000 KRW, and KB Securities from 930,000 KRW to 750,000 KRW.

Kim So-hye, a researcher at Hanwha Investment & Securities, analyzed, "Lineage M's daily average revenue decreased from 1.6 billion KRW in the previous quarter to 960 million KRW, and Lineage 2M's revenue declined by 21% compared to the previous quarter. The prolonged service period and adjustment of promotion intensity are the causes, but the possibility of a sharp revenue rebound is low, and it is difficult to expect revenue increases from other games to offset this."

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