[Click eStock] "JYP Ent., Powerful Earnings... Target Price Up"

Meritz Securities maintained a 'Buy' rating on JYP Ent. on the 16th and raised the target price from the previous 95,000 KRW to 120,000 KRW.

JYP Ent.'s consolidated sales for the first quarter of this year amounted to 118 billion KRW, with an operating profit of 42 billion KRW. The operating profit significantly exceeded the market consensus of 27.6 billion KRW. Thanks to strong album sales from TWICE (1.8 million copies) and NMIXX (900,000 copies), the music business grew by 59.9% year-on-year, and concert sales reached 6.7 billion KRW from Stray Kids' world tour and ITZY's Japan arena tour. By region, Japan and North America & other regions grew by 110% and 198% year-on-year, respectively, showing qualitative improvement as well. The operating profit margin recorded a maximum of 35.6%, following last year's second quarter, and net profit for the period was 42.7 billion KRW due to a one-time increase of 8 billion KRW from financial income and equity-method investment gains.

[Image source=Yonhap News]

JYP Ent.'s consolidated sales and operating profit for this year are expected to be 508.9 billion KRW and 164.1 billion KRW, respectively. In the second quarter, TWICE's world tour with 31 shows and Stray Kids' full album release are scheduled. In particular, considering recent K-pop album sales, Stray Kids' third full album is expected to achieve initial sales of over 4 million copies, following SEVENTEEN. New intellectual properties (IP) planned for this year include the debut of the boy group LOUD and a Chinese boy group in the second half, and a U.S. girl group in the fourth quarter.

Researcher Jisoo Jung of Meritz Securities analyzed, "The U.S. girl group project, which will be released via online streaming at the end of this month, is not just an addition of new IP but an important event that can present the possibility of success in the U.S. market and an upward revision of valuation," adding, "This will mark the beginning of a full-scale attack on the local U.S. market."