Daol Investment & Securities said on the 28th that while high-vintage intellectual property (IP) remains on a growth track for JYP Entertainment, lower-vintage IP needs gradual performance improvement. It also noted that the strategy to expand MD sales could serve as a share price catalyst as Blue Garage's earnings improve and regions subject to excess revenue settlement expand.
Daol Investment & Securities maintained a target price of 100,000 won and a Buy rating on JYP Entertainment. The previous trading day's closing price for JYP Entertainment was 71,500 won.
For the fourth quarter of last year, JYP Entertainment's revenue and operating profit are estimated at 194.3 billion won and 34.2 billion won, down 2.4% and 7.4% year over year. This is below market expectations.
In albums, although most IPs made comebacks, sales were not high for most except Stray Kids, and revenue is expected to be 74.8 billion won, slightly down quarter over quarter. In digital music, recognition of TWICE's "Ready to Be" settlement is expected this year, but the scale is not likely to be large.
For concerts, TWICE's world tour drew a total of 580,000 attendees, including 14 shows in Asia. However, because the timing of settlements changed and Japan concert revenue was recognized in large amounts in the same period a year earlier, the base effect is high, limiting full-year growth.
Stray Kids has remained on the U.S. top 10 album sales chart for three straight years and continues an uptrend in monthly listeners on Spotify.
Im Do-young, an analyst at Daol Investment & Securities, said, "TWICE also raised its global recognition through its world tour held after 'Ready to Be,' including many additional Western dates," while adding, "Sustained performance of high-vintage IP is positive, but given the high base from last year when Stray Kids' large-scale world tour and album results were reflected, growth this year will likely be limited."
As Stray Kids' new tour, expected in the second half, is likely to be the last full-group tour before the military hiatus, proving the performance of lower-vintage IP is becoming increasingly important.
Im said, "NMIXX is in the midst of its first world tour, and the performance of its subsequent comeback is important," adding, "KickFlip is also seeing continued growth in album sales, which is positive, but with sales at the 300,000–400,000 level, results are disappointing compared with lower-vintage peers at other companies, so further improvement is needed in this year's comeback."