[Click eStock] "Webzen, Favorable Earnings Outlook... Investment Opinion and Target Price Raised"

NH Investment & Securities raised its target price for Webzen from 15,500 KRW to 22,500 KRW on the 15th, maintaining a buy rating, stating that the company has entered a performance recovery phase.

Ahn Jae-min, a researcher at NH Investment & Securities, said, "MU Monarch, released on October 19, has consistently maintained a position within the top 5 in sales rankings on the Google App Store since its launch, and is expected to contribute to the performance in the fourth quarter of this year and in 2024," adding, "Considering this, we have raised the target price."

He continued, "We have once again confirmed the strength of the MU intellectual property (IP), and we can expect another MU release not only in the domestic market but also in the Chinese market," and added, "In addition, Tervis and Awaken Legend, revealed at the G-STAR 2023 game show, as well as an in-house developed massively multiplayer online role-playing game (MMORPG), are scheduled for release in 2024."

As of the end of the third quarter, Webzen holds cash and financial assets worth approximately 520 billion KRW. The company conducted share buybacks and cancellations this year and paid cash dividends in 2022. Additional share buybacks and cancellations are expected next year, and cash dividends are also anticipated at the end of this year.

Webzen's fourth-quarter sales are projected to increase by 43.8% year-on-year to 62 billion KRW, while operating profit is expected to decrease by 2.9% to 17.2 billion KRW, surpassing the previous operating profit estimate of 11.4 billion KRW and the market consensus estimate of 12.3 billion KRW. This outlook reflects the favorable performance of MU Monarch, released in October.