Yuanta Securities Korea said on the 17th that YG Entertainment's stock has entered a breather as BLACKPINK's merchandise (MD) sales fell short of market expectations. It kept a Buy rating and cut the target price to 98,000 won from 120,000 won. YG Entertainment's previous session closing price was 62,100 won.
Lee Hwan-uk, an analyst at Yuanta Securities Korea, said, "There was a sharp improvement in earnings as the performance of the global mega intellectual property (IP) BLACKPINK was fully reflected, but high-margin tour MD sales were around 40 billion won, falling short of market expectations."
YG Entertainment posted consolidated third-quarter revenue of 173.1 billion won and operating profit of 31.1 billion won this year. Revenue rose 107.2% from a year earlier, and operating profit turned to a surplus.
The analyst expected the earnings uptrend to continue into next year. He said, "With BLACKPINK's world tour schedule and new album activities, plus BABYMONSTER's second mini album and TREASURE's Japan tour, IP utilization will keep rising," adding, "On a consolidation basis for 2026, we forecast revenue of 595.8 billion won and operating profit of 88.5 billion won."
However, the upside for the share price does not look large. The analyst said, "The BLACKPINK effect was already priced in during the first quarter, and the stock has now entered a deep breather," adding, "While there is little change in this year's outlook, the likelihood of above-expectation results has diminished, so we are applying more conservative valuation assumptions and lowering the target price."