Hyundai Department Store(069960) is weak in early trading after second-quarter results missed market expectations and brokerages cut their target prices.
At 9:24 a.m. on the 6th, Hyundai Department Store was trading on the main board at 105,700 won, down 4,400 won (4.00%) from the previous session.
Hyundai Department Store's second-quarter consolidation operating profit was 79.3 billion won, down 8.7% from a year earlier, missing the market consensus of 86.4 billion won compiled by FnGuide. Revenue fell 1.1% to 1.0681 trillion won.
Operating losses of 26.7 billion won at furniture and mattress subsidiary ZINUS weighed on companywide results. Of the 10 securities firms that issued reports that day, nine, including NH Investment & Securities, Samsung Securities, DB Securities, and Korea Investment & Securities Co., cut their target prices, with only Hana Securities making no cut.
NH Investment & Securities lowered its target price to 180,000 won from 240,000 won, and Samsung Securities cut its target to 175,000 won from 250,000 won.
Joo Young-hun of NH Investment & Securities said, "Department stores and duty-free shops delivered results in line with expectations, but ZINUS's large operating loss and rising uncertainty are dampening investor sentiment." However, he noted that given the benefits from more inbound tourists and the lower valuation, excessive concerns should be avoided.
Baek Jae-seung of Samsung Securities cut the target price, reflecting potential weakness in consumer sentiment due to a market correction and lower valuations of peers. However, he maintained a "buy" rating, saying steady consumption trends and more foreign tourists should support department store sales.