[Click eStock] "Devsisters: Existing Titles Resurge and New Release Anticipation... Target Price Up"

Target Price Raised from 53,000 Won to 64,000 Won

On July 3, Shinhan Investment & Securities raised its target price for Devsisters from 53,000 won to 64,000 won, citing the resurgence of its existing titles and expectations for a new release in October as drivers for the stock's upward movement. The investment opinion remains 'Buy'.

Kang Seokoh, an analyst at Shinhan Investment & Securities, stated, "We raised our target price based on revised earnings estimates and adjustments to the price-to-earnings ratio multiple." He added, "We increased the target multiple in consideration of the long-term growth of the Cookie Run intellectual property (IP), the increase in overseas traffic, and the company's ability to develop various genres."

Devsisters' earnings for the second quarter of this year are expected to exceed market expectations. Kang said, "Second-quarter operating revenue is projected to reach 91.9 billion won, up 68.6% year-on-year, and operating profit is expected to rise by 108.6% to 10.3 billion won, both significantly surpassing consensus estimates (revenue of 78.3 billion won and operating profit of 8 billion won)." He continued, "Although it is typical for Cookie Run: Kingdom's revenue to decline in the second quarter, which is a low season, after the fourth-anniversary update in the first quarter, there was an explosive increase in spending by new users in the United States. Cookie Run: Kingdom's revenue in the second quarter is estimated at 72.9 billion won, up from 70.1 billion won in the first quarter. As the scale of this cash cow grows, we have raised our earnings estimates for 2025 and 2026." He also noted that both OvenBreak and Tower of Adventure are expected to see a rebound in traffic and revenue compared to the previous quarter, and the increasing share of overseas revenue for the Cookie Run IP is also a positive factor.

The new brawler action title Cookie Run: OvenSmash is expected to launch in October. Kang stated, "We estimate average daily revenue in the first quarter after release to be about 400 million won," adding, "With the significant improvement in annual profit strength due to the resurgence of existing titles, expectations for the imminent new release are likely to be strong."