Great Entertainment Stocks with Strong Performance and Rookie Momentum

Entertainment Stocks Show Strong Performance from the Start of the Year... HYBE Up 15%, JYP Entertainment Up 8%
K-pop ETFs Also Deliver Solid Returns
Strong Earnings, Artist Momentum, and Positive External Factors

Since the beginning of the year, entertainment stocks have shown remarkable strength. Although last year was a sluggish year due to a decline in album sales, this year, momentum from rookies, solid earnings, and external factors are expected to have a positive impact on entertainment stock prices.

According to the Korea Exchange on the 16th, HYBE has risen 14.79% so far this year. JYP Entertainment (JYP Ent.) rose 8.73%, YG Entertainment 7.10%, and SM Entertainment 2.25%. Along with the strong performance of entertainment stocks, K-pop exchange-traded funds (ETFs) have also recorded favorable returns this year. ACE KPOP Focus rose 7.65%, and HANARO Fn K-POP & Media increased by 6.84%.

The strength of entertainment stocks is due to the expected active activities of key artists. Lee Ki-hoon, a researcher at Hana Securities, said, "In 2025, artist momentum will reach an all-time high level." He added, "The full group BTS is expected in June this year, and Blackpink’s world tour is also planned for the second half of the year. Amid their absence, K-pop Google Trends have continued to decline about 44% compared to the peak two years ago, but with the simultaneous comeback of the world’s top two YouTube subscriber artists, a significant trickle-down effect is expected across the industry, and it will regain its peak again." He continued, "Also, including Stray Kids, who have an unprecedented North and South America stadium tour scheduled from March to July, all three core intellectual properties (IPs) will conduct North American tours. If the won-dollar exchange rate remains around 1,400 won, additional earnings upgrades can be expected."

Rookie momentum is also a factor to look forward to. JYP Entertainment’s rookie boy group Kickflip will release their first mini-album and officially debut on the 20th. Lee Hwa-jung, a researcher at NH Investment & Securities, analyzed, "With two artists (Stray Kids, TWICE) capable of Western stadium tours and a new growth engine (Kickflip), the gradual resolution of the biggest weakness, the underperformance of low-experience lineups, is expected."

At SM Entertainment, rookie girl group HUTS TO HUTS will debut next month. HUTS TO HUTS is the first SM rookie girl group to debut in about five years since aespa in 2020 and is a group debuting in SM’s 30th anniversary year, drawing attention. Choi Min-ha, a researcher at Samsung Securities, said about SM, "Last year is expected to end with a decrease in profits compared to the previous year due to cost burdens from decreased album sales, system restructuring, and subsidiary underperformance, but this year will show a different side." She added, "A rookie group debut rush is expected from the first quarter. The eight-member rookie girl group HUTS TO HUTS confirmed their debut in Korea in February, and the North American subsidiary Dear Alice will officially debut in February, which is expected to add to sales and improve profitability."

Album sales, which caused the sluggishness of entertainment stocks last year, are also expected to recover this year. Ji In-hae, a researcher at Shinhan Investment Corp., said, "Last year, the four major entertainment companies’ album sales decreased by 27% year-on-year to 62.86 million copies, with HYBE down 24%, JYP Entertainment 27%, SM Entertainment 26%, and YG Entertainment 58%, which was the biggest cause of last year’s decline in entertainment industry stock prices." He analyzed, "This was due to a temporary reduction in Chinese group-buying volume and the removal of the album sales bubble that had accumulated during COVID-19, resulting in a lower base level, and album sales are expected to grow moderately this year."

This year, earnings, external variables, and momentum are all expected to be favorable. Researcher Ji said, "This year will be the most harmonious year for the three factors of individual fundamentals, macroeconomic variables, and IP momentum." He added, "External factors such as interest rate cuts, exchange rates, non-application of U.S. tariffs, China’s economic stimulus, and the possible lifting of the Hallyu ban are also very positive."

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