[Click e-Stock] NH: "Megastudy Education Target Price Lowered to 60,000 Won... Investment Opinion Maintained as Buy"

On January 26, NH Investment & Securities revised its target price for Megastudy Education downward from 68,000 won to 60,000 won, estimating that the company would underperform market consensus in the fourth quarter due to the off-season. The investment opinion remains 'Buy'.

In a report released that day, Jung Ji-yoon, an analyst at NH Investment & Securities, stated, "We estimate year-on-year sales growth rates by business segment as follows: preschool, elementary, and middle school -9%, high school -8%, and adult -16% (excluding the civil service segment, +10%)." She added, "The adult segment is expected to continue to see a decline in sales through the fourth quarter due to the divestment of the company's own civil service business. However, with increased transfer student quotas and strong product sales, Ivy Kim Young's performance is expected to remain solid."

She analyzed, "For the preschool, elementary, middle, and high school segments, negative growth is inevitable considering the high sales base from the previous year, which was due to a one-off reversal of provisions related to online payment refunds."

However, funds targeting separate taxation on dividend income are expected to flow in between February and March. Given that the company is likely to meet the criteria of a dividend payout ratio of at least 25% and a 10% increase in cash dividends compared to the previous year, it is considered a suitable stock for separate taxation.

Jung explained, "Since 2024, the company has announced a three-year average shareholder return rate target of '60%+a' and is continuing to implement shareholder return policies. Last year, with an estimated 20 billion won in treasury stock cancellation and a minimum dividend of 28.5 billion won, the dividend yield stands at 6.7% and the shareholder return rate at 53.2%, demonstrating strong shareholder returns. The sustainability of these policies is expected to be a key merit going forward."

원본보기 아이콘

© The Asia Business Daily(www.asiae.co.kr). All rights reserved.