[Click e-Stock] "Spring Will Arrive in Q2...CJ Freshway to Gain Online Market Share"

On April 22, DS Investment & Securities stated that CJ Freshway is expected to report sluggish results for the first quarter of this year, as the seasonal off-peak period coincides with increased expenses. However, the firm maintained its target price at 50,000 won and its "Buy" investment rating.

Jang Ji-hye, a researcher at DS Investment & Securities, explained in a report released the same day, "In the food materials distribution division, the volume supplied to general restaurants with low profitability continued to decline following the integration of Fresh One in July last year, as the company optimized its business structure. Although strategic marketing expenses were incurred for online channels, the effects will start to materialize from the second quarter. Meanwhile, the food service division benefited from continued volume contributions at Incheon Airport, but we expect growth to slow due to a reorganization of the food service materials portfolio by channel."

CJ Freshway's first-quarter consolidated results are expected to slightly miss market expectations, with sales up 3% year-on-year to 821.9 billion won and operating profit also up 3% to 10.9 billion won. However, from the second quarter, stronger sales growth is anticipated, driven by increased online market share of food materials.

Researcher Jang added, "The recent share price has declined excessively due to profit-taking and concerns over first-quarter underperformance, but our investment points and annual earnings growth outlook remain unchanged. There is significant potential for valuation upside, driven by future enhancements in online platform competitiveness and improvements in the company's financial structure."

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