Youngone Corporation Remains Strong Despite Volatile KOSPI

Strong Earnings Despite Tariff Concerns
Yeouido Analysts Raise Target Prices Across the Board
Stock Surges 46% This Month

Amid increased volatility in the domestic stock market this month, shares of Youngone Corporation have surged by more than 40%. The surge in buy orders is attributed to the company’s unexpected strong performance in the third quarter of this year.

According to the financial investment industry on November 20, Youngone Corporation has risen by 45.7% so far this month. During the same period, the KOSPI fell by 4.3%. Although concerns over a potential artificial intelligence (AI) semiconductor bubble originating from the United States have negatively impacted the domestic stock market, Youngone Corporation has seen its corporate value increase thanks to its improved earnings. Its market capitalization has surpassed 3.7 trillion won.

The company appears to have boosted its corporate value by demonstrating, through its third-quarter results, that it has overcome concerns regarding tariffs. Youngone Corporation manufactures outdoor and sports apparel, footwear, and backpacks on an OEM basis for about 40 well-known overseas buyers, including The North Face, Lululemon, and Patagonia. The company operates production bases in various regions such as Bangladesh, Vietnam, El Salvador, and Ethiopia. Since August, the U.S. government has imposed a reciprocal tariff of 20% on Bangladesh. The financial investment industry had previously lowered Youngone Corporation’s earnings forecasts in consideration of the tariff impact.

In the third quarter of this year, Youngone Corporation recorded sales of 1.2047 trillion won and operating profit of 181.2 billion won. Compared to the same period last year, these figures represent increases of 13% and 73%, respectively. In the OEM segment, third-quarter sales reached 826.6 billion won, up 5% year-on-year. Profitability improved due to the leverage effect from increased production volume and a low rate of wage growth.

Lee Jinhyup, a researcher at Hanwha Investment & Securities, explained, "Operating profit exceeded market expectations by 41%. The rapidly growing share of sales to Arc'teryx, especially driven by growth in China, is leading to an increase in Youngone Corporation’s order volume."

Lee Hyein, a researcher at Samsung Securities, analyzed, "Despite being in a phase where the impact of tariffs is becoming more pronounced, we have once again confirmed a solid trend. The main growth drivers are increased orders from Arc'teryx, a key client, as well as new customers." She added, "If order growth continues in the fourth quarter and the leverage effect and the slowdown in wage growth persist, the OEM profit margin is expected to remain in the 20% range this year."

Securities firms’ research centers have unanimously raised their target prices for Youngone Corporation. DB Financial Investment raised its target price from 95,000 won to 110,000 won, while NH Investment & Securities and Daishin Securities raised theirs to 100,000 won.

Heo Jena, a researcher at DB Financial Investment, explained, "Order volumes from clients such as The North Face, Lululemon, and Engelbert Strauss have increased by more than 10%. Thanks to strong sales of the Arc'teryx brand, its sales share has risen to 15%." She emphasized, "An increase in production share among existing buyers and expansion of new clients are positive factors, and we maintain our top-pick recommendation within the sector."

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