[Click eStock] "Com2uS, Q1 Operating Loss Inevitable... Target Price Down"

Target Price Revised Down from 48,000 Won to 43,000 Won

NH Investment & Securities on the 23rd downgraded the target price for Com2uS from 48,000 KRW to 43,000 KRW, anticipating an operating loss in the first quarter of this year. The investment rating was maintained at 'Neutral.'

Jaemin Ahn, a researcher at NH Investment & Securities, explained, "The target price downgrade is due to a slightly delayed earnings turnaround compared to initial expectations, leading to a slight downward revision of earnings estimates from 2024 onward. It will take a bit more time for a meaningful improvement in operating profit."

An operating loss is expected to be unavoidable in the first quarter of this year. Researcher Ahn analyzed, "Com2uS's first-quarter earnings are projected to show revenue of 167.9 billion KRW, down 12.8% year-on-year, and an operating loss of 7 billion KRW, making it difficult to turn a profit yet. 'Starseed' was launched on the 23rd of last month, so initial sales have not been reflected, while related marketing expenses are estimated to have increased."

There is an opinion that a return to profitability is possible in the second quarter. Researcher Ahn stated, "In the second quarter, the 10th anniversary event of 'Summoners War: Sky Arena' and the three-and-a-half-month reflection of Starseed's sales are expected to enable a return to profitability. Starseed has secured a position within the top 20 on the Google Play Store, achieving decent results, but its sales scale is not large enough to rapidly improve earnings."

Positive factors are expected to become more prominent toward the second half of the year. Researcher Ahn forecasted, "Expectations for the new CEO, restructuring of the media business, a strategic shift focusing on publishing, and still strong intellectual property (IP) such as Summoners War and baseball games are several positive factors that will become more prominent as the year progresses."