[Click eStock] "Cheil Worldwide, Performance Upward from Second Half... Growth Focused on Overseas and Digital"

DB Financial Investment maintained a buy rating and a target price of 26,000 KRW for Cheil Worldwide on the 21st, stating that although the annual performance this year is expected to decline compared to the previous year, it is certain that advertising agency volume and performance have been on an upward trend from the second half of the year after bottoming out in the first half.

Cheil Worldwide's gross profit for the fourth quarter is expected to be 419.5 billion KRW, a 1.6% increase compared to the same period last year, and operating profit is forecasted at 77.2 billion KRW, a 7.5% increase, surpassing consensus estimates.

Shin Eun-jung, a researcher at DB Financial Investment, explained, "Domestic gross profit is expected to decline by 3% compared to the same period last year," adding, "Although the fourth quarter is the peak season, the impact of major advertisers' marketing cost efficiency continues, and the volume from non-affiliated advertisers with a large share of traditional media such as TV also remains sluggish."

Overseas gross profit is expected to increase by 2.8% compared to the same period last year. Researcher Shin said, "Due to the continued departure of non-affiliated advertisers from IRIS, Europe is expected to experience a decline, but growth centered on the US and China is expected to offset this."

Next year, a gradual recovery in the domestic advertising market is anticipated. Overseas, the market recovery in Europe, which had been sluggish, and growth centered on the US are expected to continue. Researcher Shin added, "In particular, the Paris Olympics are expected to contribute slightly to the improvement of Europe's previously sluggish performance," and "Next year, both domestically and internationally, topline growth is expected to continue by expanding campaigns, volume execution, and new non-affiliated advertisers centered on digital and platform sectors such as dot-com and e-commerce rather than traditional media." Reflecting these points, consolidated gross profit for next year is expected to increase by 8.1% to 1.7395 trillion KRW, and operating profit is forecasted to rise by 9.3% to 337.4 billion KRW compared to the same period last year.

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