[Click eStock] "SOOP, Attractive Undervaluation Amid Profit Growth Trend"

On the 1st, Samsung Securities maintained a target price of 160,000 KRW and a 'Buy' investment rating for SOOP, highlighting its undervaluation appeal amid better-than-expected second-quarter performance.

Researcher Odonghwan stated, "The top BJs' Star Balloon sales continued to grow, resulting in a 27% year-on-year increase in platform revenue for the second quarter," adding, "Advertising revenue, which was a concern, also rose 14% year-on-year due to strong sales from subsidiary CTTD, leading to an overall revenue increase of 23%."

Researcher Oh evaluated, "The total MUV (excluding mobile web) for the second quarter was 5.11 million, down 5.5% year-on-year, raising concerns about a shrinking user pool; however, the number of paying users and average viewing time per user increased by 19% and 10% respectively compared to the previous year, indicating improved user activity metrics."

He added, "In the third quarter, the contribution of subscription revenue is expected to increase due to the restructuring of the paid subscription model," and said, "Since the influx of Twitch users has concluded, it is difficult to expect further expansion of the domestic user pool, but revenue growth through an increase in Average Revenue Per Paying User (ARPPU) is expected to continue."

The key factor is the performance of the global SOOP. The global SOOP, currently conducting beta service in June, is enhancing streaming stability and expanding the local streamer pool. The company plans to improve functional aspects such as user TTS and real-time translation in the second half of the year and to hold local game leagues starting from the end of the year.

Researcher Oh emphasized, "The stock price has fallen due to concerns over traffic decline, approaching historically low valuation levels," and added, "However, as the ARPPU of the core user base continues to rise, high profit growth is expected to persist in the second half of the year, and with the anticipated visible results of the global SOOP from 2025, the current stock price is judged to be excessively undervalued."