Shinhan Investment & Securities on the 10th said that while there are several factors for a revaluation of Mirae Asset Securities' corporate value, they are already largely priced in, and it expects stock volatility to expand depending on shareholder-return policy. It lowered its investment opinion from "buy" to "trading buy (short-term buy)." However, it raised the target price to 54,000 won. Mirae Asset Securities' previous closing price was 53,400 won.
Mirae Asset Securities posted 577.3 billion won in net profit attributable to controlling interests in the fourth quarter of last year. It was an earnings surprise that beat the consensus (market average forecast) of 389 billion won.
Im Hee-yeon, an analyst at Shinhan Investment & Securities, said it was "an increase in profit and loss due to brokerage fees, strong domestic and overseas stock markets, and higher trading value."
Im set the target price-to-book ratio (PBR) at 2 times, factoring in mid- to long-term profit growth and the potential for a revaluation of asset value in the fair PBR. Adding the value of investment assets such as unlisted innovative companies, Im estimated a fair market capitalization of 30 trillion won and a fair stock price of 54,000 won. Im also saw room for a fair-value re-rating upon further portfolio revaluation ahead.
However, Im explained that given a significant portion of the strong results stemmed from valuation gains, stock volatility could increase depending on whether and how those gains are converted into resources for shareholder returns.
Im said, "With the visualization of returns from investments in innovative companies, improved profits at overseas subsidiaries, and a recovery in the real estate cycle, the company is in a phase of rising held asset values," adding, "these are clearly factors for a revaluation of corporate value, but in the short term they are already partially reflected in the share price."
At the same time, Im presented a neutral short-term view and said the investment opinion will be revisited after confirming whether the shareholder-return policy is detailed.