"Increased Volatility in Cosmetics Sector, Attention Needed on Companies with High 'Earnings Stability'"

Korea Investment & Securities advised on the 2nd that investors should pay attention to companies with high earnings stability within the cosmetics sector.

Myungjoo Kim, a researcher at Korea Investment & Securities, stated, "The business conditions of the Korean cosmetics industry remain unchanged, but due to macroeconomic uncertainties, stock price volatility in the cosmetics sector has increased," adding, "It appears that APR's weak second-quarter earnings negatively impacted sector investment sentiment."

According to preliminary figures, cosmetics exports in the previous month increased by 27.9% year-on-year, with exports to the United States growing by 75.1%. Researcher Kim noted, "Despite the favorable business conditions, the reason for the significant increase in stock price volatility is due to index adjustments and easing of supply-demand imbalances, which have heightened profit-taking demands in the sector," and added, "Since most cosmetics companies have shown good returns since the beginning of the year, even minor disturbances can lead to stock price corrections."

He continued, "However, considering that the second half of the year is the peak consumption season and the steadily growing global popularity of Korean cosmetics, it is necessary to focus on companies like Silicon투 that have high earnings stability to prepare for volatility," he added.