[Click eStock] "SKT, Largest Shareholder Return Scale... Active Buying Below 50,000"

Annual Shareholder Return Scale at 9%, Top Level Among Listed Companies
Only Telecom 3 Company with Annual Operating Profit Growth
"Active Purchase Below 50,000 Won...Good Stock for Mid- to Long-Term Holding"

Hana Securities on the 6th maintained a target price of 60,000 KRW for SK Telecom (SKT), citing it as the only one among the three major telecom companies to have increased its dividend per share (DPS), and presented it as the top preferred stock in the sector. The investment opinion 'Buy' was also maintained. SKT's closing price on the 5th was 50,400 KRW.

Researchers Kim Hong-sik and Go Yeon-su of Hana Securities stated, "With growing expectations for increased shareholder returns, low PBR (price-to-book ratio) stocks have recently been gaining attention in the stock market. In the case of SKT, the annual shareholder return relative to market capitalization reaches 9%, which is competitive compared to any listed company in Korea." They added, "Considering the continued increase in dividend inflows from SK Broadband and Hana Financial Group, it is highly likely that the current high dividends and share buyback scale will be maintained." ▲ The introduction of 5G Advanced in 2025 is expected to sustain a long-term performance improvement trend ▲ Although the regulatory environment is unfavorable, SKT is positively evaluated because it is expected to secure strong downside rigidity in terms of stock price.

SKT posted an operating profit of 297.1 billion KRW in Q4 2023, a 17% increase compared to the same period in 2022, surpassing market consensus (average forecast). Among the three telecom companies, SKT was the only one expected to show an increase in annual operating profit as LG Uplus and KT prepared to announce their Q4 results. The two researchers said, "In Q4, SKT's mobile phone sales increased by 1% year-on-year, and marketing expenses remained at a similar level compared to the previous year." They added, "Labor costs also recorded only a slight increase year-on-year." Depreciation expenses were also at a similar level year-on-year. However, SK Broadband, a key subsidiary, continued revenue growth but saw a decrease in operating profit compared to the previous quarter.

Researchers Kim Hong-sik and Go Yeon-su recommended, "During this earnings season, we advise setting a short-term target return and engaging in SKT trading." They explained, "Although SKT recorded solid results in 2023, the earnings outlook for 2024 is not optimistic, primarily due to an unfavorable regulatory environment." Market concerns include various 5G plans meticulously designed by data, amendments to the enforcement decree related to the Mobile Device Distribution Act, and planned policy financial support and funding for the fourth mobile carrier. They recommended gradually reducing holdings above 55,000 KRW and actively buying below 50,000 KRW.

The two researchers added, "Unless there is a clear alternative, an annual return of up to 9% is guaranteed, and there is a high possibility of entering a major upward trend after the year-end, so mid- to long-term holding is not a bad option." They emphasized, "Recently, low PBR stocks have been attracting attention from the perspective of shareholder returns, but it is necessary to focus more on the actual shareholder return ratio and its changes rather than just the simple PBR indicator."

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