[Click eStock] "'Earning Surprise' YG Entertainment, Target Price Up"
NH Investment & Securities announced on the 12th that it is raising the target price for YG Entertainment from the previous 77,000 KRW to 96,000 KRW.
Recently, the girl group BLACKPINK strengthened their global recognition by headlining the Coachella Festival in the United States. NH Investment & Securities expects the contract renewal scheduled for August to proceed smoothly. Additionally, the overall lineup including BabyMonster and TREASURE is showing strong growth, but the price-to-earnings ratio (PER) is only 24 times, which is significantly undervalued compared to the industry average of 36 times.
In particular, YG Entertainment recorded consolidated sales of 157.5 billion KRW and operating profit of 36.5 billion KRW in the first quarter. This represents an increase of 119% and 458%, respectively, compared to the same period last year, marking an earnings surprise that exceeded market expectations.
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Researcher Ihwa Jeong of NH Investment & Securities commented, "This is understood to be due to the increase in guarantees per performance, supported by the strong audience turnout confirmed during the US concerts in the fourth quarter," adding, "The first quarter was a period where global recognition translated into solid performance strength."
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