[Featured Stock] Fila Holdings Faces Harsh Criticism from Securities Firms... Decline Amid 'Target Price Downgrade'

[Asia Economy Reporter Lee Seon-ae] FILA Holdings' stock price continued to decline on the 22nd. The downward revision of target prices by securities firms is interpreted as having frozen investor sentiment. As of 10:17 AM on the same day, the stock price was trading at 32,050 won, down 3.32% from the previous trading day.

Hana Financial Investment pointed out that FILA Holdings faces concerns over global supply risks and performance uncertainty due to brand restructuring. The target price was also lowered by 15%, from the previous 53,000 won to 45,000 won. Seo Hyun-jung, a researcher at Hana Financial Investment, analyzed, "FILA Holdings set a growth target of up to 2% for consolidated sales and operating profit this year, but short-term performance is expected to be sluggish. We have downgraded domestic and U.S. earnings estimates and valuations, and until brand sales and recognition recover, stock price momentum will not be significant."

KTB Investment & Securities also lowered the target price for FILA Holdings from 53,000 won to 45,000 won, citing that the fourth-quarter performance last year fell short of market expectations. Researcher Baesong said, "The mid- to long-term growth strategy announced last month set FILA Holdings' five-year average annual growth target at 3%, which is somewhat modest. Through this earnings announcement, they additionally provided a performance guidance for this year at a flat level." He added, "This year, regardless of margins, they plan to adjust the mix in channels that hinder brand appeal. This will act as a short-term performance uncertainty, and a decline in profits is expected in the first half of the year."

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