Shinhan Investment Corp. noted on the 20th that there is a possibility of an earnings surprise due to the settlement of the production committee for "Solo Leveling" within the second half of the year for D&C MEDIA. However, it is anticipated that there will not be significant stock price fluctuations in the meantime, as the effect of the airing of the "Solo Leveling" animation has diminished and interest in the webtoon has decreased.
D&C MEDIA's second-quarter sales amounted to 24.6 billion won, with operating profit reported at 4.5 billion won. This marks an increase of 1.8% and 12.6%, respectively, compared to the same period last year. With the settlement of overseas e-book publications and satisfactory performance of new domestic titles, the results are evaluated as not bad considering the difficult market conditions.
This year's operating profit forecast is set at 12.7 billion won, which is expected to increase by 23.8% compared to the previous year. The first settlement of the production committee for "Solo Leveling" season 2 is expected to take place in the second half of the year. "Solo Leveling" season 2 has achieved success to the extent of being selected as the work with the highest viewership on Crunchyroll, the world's largest animation OTT platform. Accordingly, revenue is also expected to exceed initial expectations.
Kim Ah-ram, a senior researcher at Shinhan Investment Corp., said, "While the target stock price is lowered, the downward pressure on the stock price doesn't seem significant," adding, "There are no immediate issues for short-term stock price increases, but it is positive that they are capable of generating over 10 billion won in annual revenue with products utilizing the "Solo Leveling" intellectual property."
The target stock price has been lowered from the previous 24,000 won to 19,500 won, and the investment opinion has been set to "buy."