[리포트 브리핑]Kakao, ‘on a diet’ target price of 50,000 won – SK Securities

[서울=뉴스핌] Robo News = On the 16th, SK Securities issued a new report on Kakao (035720) with an investment opinion of ‘BUY’, saying that it was ‘on a diet’, and set a target price of 50,000 won. Based on the previous day’s closing price, it can be interpreted that this stock’s stock price has an additional upside of 32.8% compared to the target price.

◆ Kakao Report main contents
SK Securities said of Kakao (035720), ‘Selection and focus: The company defined its core business as KakaoTalk and AI in the second quarter conference call. The company announced that it would efficiently allocate company-wide resources centered on core businesses and carry out measures to make the business lean, such as reducing manpower and selling off business divisions for businesses that have little synergy with other core businesses. Following the absorption of Kakao Space, Brain, and the merger with Daum Global Holdings, the company sold its stake in Sena Technology and liquidated Kakao Hair Shop during the third quarter, and will continue to reorganize its portfolio focusing on its core businesses for the time being.’

Also, SK Securities said, ‘3Q24 Preview: Content sluggishness continues. It is expected to fall below the consensus with operating revenue of KRW 1.97 trillion (-2.1% YoY, the same below), operating profit of KRW 118.3 billion (-4.8%), and net profit for controlling shareholders of KRW 62.9 billion (+198.0%).

◆ Changes in Kakao’s previous target price
– Target price adjusted downward, KRW 55,000 -> KRW 50,000 (-9.1%)
– SK Securities, recent one-year target decline
The target price of 50,000 won presented by SK Securities analyst Nam Hyo-ji for this stock is a -9.1% decrease from SK Securities’ previous target price of 55,000 won issued on August 12, 2024. Looking at the target price presented by SK Securities for this stock over the past year, it rose after suggesting 65,000 won on October 17, 2023, and presented the highest target price of 78,000 won on March 25, 24.
In this report, the price declined somewhat and presented the lowest target price of 50,000 won in the past year.

◆ Kakao target price compared to consensus
– Average target price 52,826 won, SK Securities conservative evaluation
– Overall consensus conservative change compared to the past 6 months
The target price of KRW 50,000 presented by SK Securities today is -5.3% lower than the average target price of KRW 52,826 for all securities companies over the past six months, but it is 19.0% higher than Samsung Securities’ target price of KRW 42,000, which is the lowest target price among all securities companies. This means that SK Securities is evaluating Kakao’s stock price relatively conservatively compared to other securities companies.
For reference, the average target price of 52,826 won for all securities companies over the past six months is down -25.6% from the average target price of 70,958 won for the previous six months. This shows that securities firms’ overall analysis of Kakao’s future stock price has become conservative.

This article was written in real time by an automatic article generation algorithm jointly developed by Newspim and Thinkful, a financial AI specialist company.