Heungkuk Securities said on the 9th that HYBE's record-high quarterly results for the second quarter of this year are within reach. It maintained a "Buy" rating and lowered the target price to 330,000 won. HYBE's previous closing price was 230,000 won.
Heungkuk Securities projected HYBE's second-quarter revenue at 1.2484 trillion won and operating profit at 161.2 billion won, up 76.9% and 144.6%, respectively, from a year earlier. In particular, operating profit was forecast to exceed the market consensus of 148 billion won.
For albums and digital music, it said results are expected to top expectations as BTS's North America LP, about 2.75 million for Cortiz, about 1.9 million for TOMORROW X TOGETHER (TXT), about 1.3 million for TWS, about 1.23 million for BOYNEXTDOOR, and about 680,000 for LE SSERAFIM are reflected.
In particular, Cortiz's album was predicted to bolster album results as sales are recognized through the fourth quarter depending on shipping timing. Goods (MD) and licensing were expected to be supported by on-site sales, Weverse Pick-up, and the Yongsan "Arirang" pop-up.
Song Ji-won, an analyst at Heungkuk Securities, said, "For concerts, a stable trend is expected as revenue from the BTS world tour, as well as tours by ENHYPEN, &TEAM, ILLIT, and SEVENTEEN, and online streaming and live viewing are recognized together."
It was forecast that the cost-to-sales burden for large intellectual property (IP) concerts would be offset by strong albums, digital music, and MD, delivering solid profitability, and that the likelihood of one-off expense was low.
Song said, "In the second half, it's a phase where expectations can be raised," adding, "In the second half, the scalability of new global IPs such as Cortiz's world tour, KATSEYE's new release and Europe and North America tours, and the North American girl group 'Saint Satin' is important."
Heungkuk Securities raised its revenue estimates for HYBE but lowered the target price to 330,000 won by adjusting the multiple to reflect external supply-demand imbalances and the sector's relative neglect.