[Click eStock] "Cheil Worldwide, This Year's Performance Shows High in the First Half and Low in the Second... Target Price Down"

NH Investment & Securities forecasted on the 10th that Cheil Worldwide's performance this year will show a pattern of strong first half and weaker second half, and lowered the target stock price from 31,000 KRW to 29,000 KRW. The investment rating was maintained at 'Buy.'

Researcher Ihwa Jeong of NH Investment & Securities stated, "We changed the base year to 2024 and reflected a gradual recovery in advertising spending, lowering the target price-to-earnings ratio (PER) to 15 times (from 16 times), reducing the target stock price by 6%. Given the expected stable earnings growth due to the Paris Olympics and the popularization of artificial intelligence (AI) this year, we maintain the investment rating of 'Buy' and the Top Pick status."

Cheil Worldwide's fourth-quarter results last year are expected to fall short of market expectations. Researcher Ihwa Jeong said, "Cheil Worldwide's consolidated gross profit for Q4 is expected to decrease by 2% year-on-year to 404.4 billion KRW, and operating profit is expected to increase by 8% to 77.4 billion KRW, both below market consensus (average securities firm forecasts). Unlike the notable resumption of advertising spending in October and November, the spending trend in December was understood to be quite conservative."

This year's performance is expected to show a pattern of strong first half and weaker second half. Researcher Ihwa Jeong predicted, "Considering the Olympic effect, a performance trend of strong first half and weaker second half is expected. The gross profit growth rate is expected to increase by 7% year-on-year, and the operating profit margin is expected to improve to 20%, both better than in 2023."

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