[Click e-Stock] "Naver Maintains Target Price After Announcing Joint Platform Development with Disney"

On September 17, Korea Investment & Securities maintained its "Buy" investment rating and a target price of 300,000 won for Naver, stating, "The announcement of a joint platform development with Disney marks a significant inflection point."

On this day, Jeong Hoyoon, a researcher at Korea Investment & Securities, explained, "Despite Naver's solid fundamentals, investors have shown little interest due to the perceived lack of growth momentum. However, this collaboration between Webtoon and Disney is an event that will expand market dominance in a key business division."

Naver Webtoon announced the joint platform development with Disney the previous day. The new platform will integrate over 35,000 comics owned by Disney-including Marvel, Star Wars, and Pixar titles-as well as select original series from Naver Webtoon. Under this business arrangement, Disney will provide intellectual property (IP), while Naver Webtoon will oversee platform development and operations. To facilitate the collaboration, Disney plans to acquire a 2% stake in Webtoon Entertainment.

Researcher Jeong stated, "Through the development of this new platform, Disney's comic IPs, previously scattered across various channels, will be consolidated in one place. The new platform will operate on a subscription-based business model, allowing both existing Disney Plus subscribers and Marvel Unlimited subscribers to freely access the service."

He continued, "While Naver ambitiously declared its overseas expansion under the banner of globalizing webtoons, it has struggled in the U.S. market. The global monthly active users (MAU) of Webtoon, which stood at 119 million in the first quarter of 2023, actually declined slightly to 110 million in the second quarter of this year."

This was attributed to stronger-than-expected cultural barriers preventing webtoons from becoming mainstream in the U.S. market. However, with the recent success of K-pop and K-dramas, overall Western interest in Korean culture has risen significantly.

Researcher Jeong expressed optimism, saying, "At this point, developing a collaborative platform with Disney to naturally channel users into webtoons creates a new opportunity for webtoons to elevate their presence in the U.S. market."

He added, "An increase in commerce commission rates in the second half of the year is expected to boost operating profit. Based on this year's earnings estimates, the price-to-earnings ratio (PER) is 18.8 times, so the valuation burden is also low."