Meritz Securities said on the 19th that APR's sales are increasing above the market growth rate as its recognition is rising worldwide without special marketing. It maintained its Buy rating and raised the target price to 450,000 won from 300,000 won. APR's closing price in the previous trading day was 362,000 won.
Park Jong-dae of Meritz Securities said, "We expect a significant impact from the effect of full-scale direct online entry into Europe starting this year and the expansion of offline channels in the United States and Japan," adding, "Because its product strength has already been recognized in the U.S. online channel, earnings visibility is also high." The analysis is that, because online sales account for more than 80%–90% in both the United States and Japan, the expansion of offline channels will serve as a growth driver this year.
Meritz Securities projected that APR's first-quarter sales and operating profit on a consolidation basis this year will grow 111% and 146%, respectively, from a year earlier.
Park said, "Zero Pore Pad is currently in short supply in both Europe and the United States, so it is being shipped by air immediately upon production," adding, "With global marketing capabilities and a strategy of launching trendy new products, the effects of regional (Europe) and offline channel expansion (United States) are both coming into full swing this year."
APR's current share price is 29 times on a 12-month forward price-earnings ratio (PER) basis.
Park said, "Valuation (share price level relative to corporate value) is high, but there is no need to be overly burdened because it is difficult to gauge how much sales will increase due to regional and channel expansion effects," adding, "A strategy of steadily increasing the weighting is valid."
APR's fourth-quarter sales on a consolidation basis were 547.6 billion won, and operating profit was 130.1 billion won. Compared with the same period a year earlier, sales rose 124.2% and operating profit increased 227.9%.
Park said, "With the rise in the business-to-consumer (B2C) share, the gross margin improved, and although marketing expenses increased, the burden of fixed costs eased."