[Featured Stock] "The Season of Pyeonmaek Has Arrived"... BGF Retail Rises for 4 Consecutive Days

[Asia Economy Reporter Ji Yeon-jin] BGF Retail is showing strong performance on the KOSPI market on the 10th as expectations for peak season convenience store earnings are spreading.

As of 10:51 AM on the day, BGF Retail is trading at 176,000 KRW, up 10,000 KRW (6.02%) from the previous trading day. This stock has recorded gains for four consecutive days recently.

The financial investment industry analyzed that as the weather warms up and convenience stores enter the full peak season, earnings expectations are boosting the stock price. BGF Retail operates the convenience store CU.

BGF Retail posted consolidated sales of 1.5012 trillion KRW and operating profit of 21.6 billion KRW in the first quarter. These figures represent increases of 7.8% and 16.8%, respectively, compared to the same period last year. Park Eun-kyung, a researcher at Samsung Securities, said, "Operating profit fell short of market consensus by 10%," adding, "The main reason for the shortfall was that the poor performance of high-profit specialty stores (such as hospitals and university areas) in January and February was larger than initially expected."

However, the earnings momentum is expected to strengthen from the second quarter. Park Jong-ryeol, a researcher at Hyundai Motor Securities, said, "Although the forecast was slightly missed, the operating performance is good enough to make up for last year's slump," and evaluated, "The positive point is that the impact of COVID-19 is gradually diminishing as time passes this year."

Researcher Park said, "With the recovery of the domestic economy and the improvement of the business environment due to the increase in domestic travelers, combined with proactive store network expansion efforts, the growth trend in scale will expand," adding, "The earnings improvement will accelerate due to profitability enhancement from product mix improvements such as a decrease in the proportion of tobacco sales and growth in high-margin categories." Hyundai Motor Securities estimates BGF Retail's consolidated second-quarter earnings at sales of 1.6797 trillion KRW and operating profit of 55.9 billion KRW.