Shinhan Investment & Securities on the 28th said Neowiz has increased earnings stability compared with the past thanks to the performance of both large and small new games. It maintained its Buy rating and raised the target price to 34,000 won. Neowiz's previous closing price was 24,550 won.
Neowiz's game "Brown Dust 2" has climbed back since last year and is now contributing to Neowiz's earnings surprise as a major IP.
Kang Seok-o, an analyst at Shinhan Investment & Securities, said, "With a continued stream of both large and small new titles, the share price will also trend upward in a stable manner."
In the third quarter of this year, Neowiz posted 127.4 billion won in operating revenue and 26.5 billion won in operating profit. Operating profit beat the consensus (market average forecast) of 26.5 billion won.
Kang said, "The effect of the second-anniversary update for Brown Dust 2 that began in June was deferred, and the new title 'Shape of dreams' sold 500,000 copies in two weeks, delivering a surprise."
Brown Dust 2 continued marketing by participating in major game shows in Taiwan and Japan, and the rising share of overseas sales is seen as encouraging.
Kang explained, "It is not just rebounding on the effect of Nth-anniversary updates; as the user base broadens, results are trending upward, and it is establishing itself as a top-tier subculture IP."
As Neowiz's brand value as a publisher itself increases, the marketing efficiency of the WolfEye and Jakazane publishing titles now in preparation, and multiple PC and console games being prepared by Round8, is also expected to improve.
Kang said, "Since 2023, it has proved its capability to develop highly loyal IP, and a succession of both large and small new titles have been hits, driving results upward," and analyzed, "Subsequently, the improved earnings stability versus the past from the performance of both large and small new titles has gently pushed the price-earnings ratio band upward."