[Click eStock] "Meritz Financial Continues Share Buybacks and Cancellation... Target Price Raised"

Mirae Asset Securities raised the target price for Meritz Financial Group to 130,000 KRW on the 21st, expecting an increase in earnings per share (EPS) due to an active share repurchase and cancellation policy. The investment rating was maintained as 'Buy.'

Researcher Jeong Tae-jun stated, "Although the profit growth rate in 2025 is expected to be modest at 0.2%, EPS is anticipated to increase by 7.3% year-on-year due to active share repurchases and cancellations."

Jeong added, "As the company announced in its corporate value enhancement plan, it plans to continue active shareholder returns centered on share repurchases until the price-to-earnings ratio (P/E) reaches around 10 times. If the ongoing share repurchase program ends in March next year without reaching a P/E of 10, it is expected to proceed with the same or even greater share repurchases than before, indicating clear upside potential."

He continued, "The holding company's double leverage ratio stands at 115.6%, below the regulatory threshold. Meritz Fire & Marine Insurance, a major subsidiary, holds the second-highest K-ICS ratio in the industry, and Meritz Securities possesses both the old and new Net Capital Ratio (NCR) exceeding regulatory levels, so there should be no issues with the targeted shareholder returns."

Furthermore, he noted, "The controlling shareholder net profit is expected to increase by 0.2% year-on-year in 2025. The third-quarter controlling shareholder net profit was 649.9 billion KRW, surpassing our estimate of 559.9 billion KRW and the consensus of 603.0 billion KRW."