“I never thought there would be this many empty seats for Blackpink… ” YG Entertainment’s target stock price plummets 28% in an instant [Investment 360]

[Herald Economy = Reporter Seo Kyung-won] YG Entertainment’s stock price is showing no signs of rebound due to the failure to renew the contract for Blackpink’s solo activities. The stock price, which was hovering around 50,000 won at the end of last year, fell to the 40,000 won range this year and is currently down to the 42,000 won range.

As of 9:30 am on the 22nd, YG Entertainment’s stock price on the KOSDAQ market is trading at 42,750 won, up 200 won from the previous trading day.

Daishin Securities lowered its target stock price from 90,000 won to 65,000 won, saying that YG Entertainment’s operating profit in the fourth quarter of last year was below market expectations and that this year’s performance is expected to be poor due to the failure to renew contracts with its artists. The goal was immediately lowered by 28%.

Researcher Lim Soo-jin said, “YG Entertainment’s operating profit in the fourth quarter of last year was 6.1 billion won, a 60% decrease compared to the same period last year, 32% lower than the consensus (market average forecast),” and “Blackpink’s contract renewal costs are incurred, and the album is released.” He explained, “The impact of absence, etc.”

He continued, “Blackpink’s solo activities have been excluded (from the additional contract), and Baby Monster’s expected album release date has been delayed, so a decrease in profits this year is inevitable.” He added, “Blackpink’s group contract renewal was successful, but whether or not they will continue to work as a group this year is inevitable.” “This year will be the most difficult time for YG Entertainment as it is still difficult to predict.”

At the same time, it is predicted that YG Entertainment’s operating profit this year will be 84 billion won, a decrease of about 1 billion won from last year.

However, Researcher Lim said, “While YG Entertainment has strengths in artist production capabilities and music fields, Baby Monster appears to have already succeeded in forming a significant fandom due to the trickle-down effect of Blackpink’s fandom, so expectations for the new artist are still valid.” “The investment opinion was maintained at ‘Buy’.

He said, “The key now is how fast Baby Monster grows,” and “The success of the music source is more important than the album sales figure in determining the timing of future performances, so the music score will serve as an important investment point.” It was elaborate.

On the 19th, YG Entertainment closed trading at 42,550 won, down 1.05% from the previous trading day.

gil@heraldcorp.com