[Click eStock] "Studio Dragon, Only Good Things Ahead"

[Asia Economy Reporter Kwon Jae-hee] DB Financial Investment maintained a 'Buy' rating and a target price of 134,000 KRW for Studio Dragon on the 2nd.

Studio Dragon's sales for the second quarter of this year are expected to reach 154.9 billion KRW, and operating profit is projected at 26.4 billion KRW, representing increases of 46.1% and 91.7% respectively compared to the same period last year. "Our Blues," "Shooting Star," and "Link" are being broadcast simultaneously domestically and internationally, while "The Killer's Shopping List" and "Eve" are scheduled for domestic airing. Additionally, "Strange," and "Yumi's Cells 2" will be reflected in performance as TVING originals.

Shin Eun-jung, a researcher at DB Financial Investment, forecasted, "With simultaneous overseas broadcasts on various platforms such as Netflix, U-NEXT, and Disney+, along with the one-time reflection of sales of older works to Disney+, Studio Dragon is expected to demonstrate solid performance."

DB Financial Investment anticipates that Studio Dragon will record better results as the second half of the year progresses. More than 33 titles are expected to be scheduled this year alone, which is a clear top-line growth compared to the average scheduling level of 25 titles in 2020-2021. The airing of tentpole works increasing in the second half is also expected to contribute to profits. These include "Alchemy of Souls" in June, "Little Women," "Shuroop," and at the end of the year, "Island" and "After School War Activities." Reflecting this, the annual sales for this year are expected to be 608 billion KRW, and operating profit 80.6 billion KRW, representing growth of 24.8% and 53% respectively compared to the previous year.

Researcher Shin analyzed, "In the first half of the year, Netflix's poor performance and subscriber indicators led to concerns about reduced content production costs, causing the media sector stocks including Studio Dragon to underperform. However, considering Studio Dragon's stable quarterly performance, an expanded lineup compared to last year, and upcoming Netflix contract renewals as well as additional contracts with global online streaming services (OTT), it is necessary to approach positively from now on."

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