[Click eStock] "CJ ENM, Increased Expectations for Second Half Performance"

Kiwoom Securities analyzed on the 19th that CJ ENM is expected to have strong second-half performance following a "high-low-high" pattern.

Namsoo Lee, a researcher at Kiwoom Securities, stated in a report on the same day, “Thanks to the success of the drama , exclusive broadcasting rights for the KBO League securing sports fans, and more, TVING’s growth is remarkable,” adding, “With two dramas released per quarter, the improvement effect is more noticeable compared to movies with high earnings volatility and documentaries with a long-tail structure.”

He explained, “Commerce will secure profitability through a one-platform strategy and organizational streamlining,” and forecasted, “Although Mnet’s advertising segment is slow, the success of La Pone JO1 and INI continues in Japan, and through managing Lim Young-woong’s concert, improved results compared to the previous quarter are expected.”

Regarding the potential loss of approximately 700 billion KRW due to the suspension of the Live City project, he analyzed that this has already been reflected in the stock price decline. He said, “The loss amount is expected to be finalized based on consultations with Gyeonggi Province and future directions, but it is judged that a figure lower than 700 billion KRW will be reflected due to construction delay compensation, impairment of construction assets showing 3% progress, and land resale.”

He also mentioned, “By disposing of non-operating investment stocks, the 5.2% stake in Netmarble was sold for about 250 billion KRW,” analyzing, “This has created room to sequentially address Live City risks, the TVING-Wavve merger issue, and debt reduction following past mergers and acquisitions, as well as an appropriate cleanup of non-operating investment stocks timed with the normalization of TVING and Fifth Season.”

He added, “Expectations for second-half performance are higher following the high-low-high pattern,” and noted, “A broad performance across all sectors is anticipated, including expanded growth in music, simultaneous improvement in TVING and Fifth Season, and recovery in advertising and movies.”