[Click e-Stock] "LG Uplus: Profit Improvement and Shareholder Return Expectations"

On May 9, DB Securities raised its target price for LG Uplus from 15,000 won to 16,000 won, citing the company's operating profit turnaround in the first quarter and long-term investment points such as expectations for shareholder returns. The investment opinion was maintained at 'Buy'.

In the first quarter, LG Uplus reported revenue of 3.7481 trillion won, up 4.8% year-on-year, and operating profit of 255.4 billion won, up 15.6%, both meeting market expectations. Shin Eunjeong, a researcher at DB Securities, explained, "The number of MVNO (Mobile Virtual Network Operator) subscribers continued to show high growth, up 21.7% year-on-year, and the proportion of 5G subscribers also remained strong at 74.8%." She added, "While Smart Home revenue was sluggish due to a decline in IPTV home shopping transmission and VOD sales, internet revenue drove overall growth." She also noted that LG Uplus is streamlining low-profit businesses such as Spoky and Stories, and implementing overall cost efficiency measures.

Expectations for shareholder returns are another positive factor. Shin stated, "After retiring all treasury shares (1.6%) in the first half of the year, the company is expected to repurchase treasury shares up to 20% of its 2025 net profit in the second half." She added, "Total dividends this year are expected to reach 280 billion won, and treasury share buybacks are projected to be around 70 billion won. The scale of annual treasury share buybacks is expected to increase, reaching 100 billion won by 2027."