Kyobo Securities on the 23rd said APR's results are improving, led by the U.S. and European markets. It maintained a Buy rating and raised its target price to 440,000 won from 370,000 won. APR's closing price in the previous session was 359,500 won.
Kyobo Securities said APR's revenue is increasing as it delivers results mainly in the U.S. and European markets.
Kwon U-jung, an analyst at Kyobo Securities, said, "Since retail sales began at ULTA in Aug. last year, APR's brand recognition has been rising quickly," adding, "The number of SKUs at entry increased rapidly in a short period, from 15 to 47 online and from 10 to 15 offline."
Kwon added, "At ULTA's January event, 'Love Your Skin (LYS),' Medicube's share rose 1.4 percentage points from the prior period, ranking No. 1 in increase, and it delivered encouraging short-term results, currently ranking No. 4 in ULTA skin care and No. 2 in prestige skin care."
Kwon projected that APR's DEVICE institutional sector sales will also increase as it expands offline stores.
Kwon said, "In the U.S. market, expansion of DEVICE is expected to accelerate in tandem with offline expansion," adding, "Given the high price point of DEVICE, offline demand is higher than for cosmetics, and during the LYS event, APR's beauty device 'Booster Pro' ranked No. 3 in GMV (gross merchandise value)."
Kwon estimated that APR's revenue will increase as it ramps up marketing in Europe as well.
Kwon said, "Until now, the European market largely remained at the level of meeting natural demand driven by the spillover effects of U.S. marketing," adding, "If local marketing and operations in Europe get into full swing, we expect a quick response in major markets such as France, Germany, Italy and Spain."
According to Kwon, APR recently faced inventory shortages, but as the original design manufacturer (ODM) expanded capacity in the first quarter, inventory normalization is underway.
Regarding this, Kwon said, "With the establishment of subsidiaries in the United Kingdom and the Netherlands, operations for the European business are expected to get into full swing," adding, "Meanwhile, APR recently had an inventory shortage issue, but as the ODM expanded capacity in the first quarter, inventory normalization is underway, and we expect full-scale sales expansion and revenue acceleration to follow."