NH Investment & Securities on the 3rd said the recent share price decline for NAVER is excessive. It maintained its Buy rating and lowered the target price to 320,000 won from 380,000 won. NAVER's previous closing price was 195,800 won.
NH Investment & Securities analyzed that as global software companies show an overall downtrend in share prices, concerns about NAVER's artificial intelligence (AI) competitiveness and its marginalization in the stock market are overlapping, leading to a continued slump in NAVER's share price.
Ahn Jae-min, a researcher at NH Investment & Securities, said, "Concerns over whether NAVER can hold out in AI competition with global big tech companies such as Google, OpenAI and Anthropic are continuing to weigh on the share price."
However, it projected that perception will improve as NAVER rolls out a variety of AI-applied services going forward.
Ahn said, "AI utilization within the NAVER platform continues to rise, and as it is integrated into various services such as advertising, commerce and maps, it is expected to enhance consumer convenience and increase time spent," adding, "Services such as a shopping agent AI and an AI tab will be unveiled in the first half, and as they are combined with NAVER's local data, consumer perception will gradually improve."
It also analyzed that with the current price-earnings ratio (PER) at 15.2 times, the recent share price decline is excessive.
Meanwhile, NH Investment & Securities forecast NAVER's first-quarter results at 3.18 trillion won in revenue and 562 billion won in operating profit. Those figures are up 14.2% and 11.2%, respectively, from a year earlier. Operating profit is expected to slightly miss the consensus (market average estimate) of 579.3 billion won.