[Click eStock] "Naver, a phase where negative factors are gradually resolving... Target Price Down"
Target Price Downgraded from 285,000 Won to 270,000 Won
NH Investment & Securities evaluated on the 17th that NAVER has entered a phase where negative factors are gradually being resolved. The target stock price was lowered from the previous 285,000 KRW to 270,000 KRW, while maintaining a 'Buy' investment rating.
Jaemin Ahn, a researcher at NH Investment & Securities, explained, "The target price adjustment is due to the downward revision of earnings estimates after 2024 and the change of NAVER Webtoon’s value to market price following its listing. The results of new services are gradually appearing, and concerns over the sale of Line Yahoo shares, which recently pressured the stock price, have been settled, marking the beginning of a phase where negative factors surrounding NAVER are being resolved." He added, "Since the supply and demand are quite vacant, the stock price is expected to seek a rebound."
NAVER’s second-quarter performance this year is analyzed to be favorable when excluding one-time costs. Researcher Ahn stated, "NAVER’s second-quarter revenue increased by 10.9% year-on-year to 2.67 trillion KRW, and operating profit rose by 10.4% to 411.4 billion KRW, slightly below the consensus (average securities firm forecast). However, costs related to NAVER Webtoon’s listing and CEO cash compensation, amounting to approximately 45 billion KRW, will be temporarily reflected, and excluding these, the results are favorable compared to market expectations."
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Due to the homepage feed revamp on the first screen and the official launch of the streaming service 'Chijijik', display advertising has recovered, with search platform revenue estimated at 973.8 billion KRW, a 7.0% increase year-on-year, and commerce revenue expected to rise by 13.9% to 720.6 billion KRW. Researcher Ahn analyzed, "Cost control, which has continued since last year, is ongoing. Marketing expenses are expected to be stably maintained at 387.7 billion KRW, a 1.1% increase, but personnel expenses will rise due to NAVER Webtoon’s listing."
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