[Click eStock] "CJ Freshway, Gap Between Performance and Stock Price Narrows"

On January 19, IBK Investment & Securities stated that CJ Freshway's price-to-earnings ratio (PER) for 2026 is projected to drop to 3.6 times, entering an extremely undervalued territory. Considering two consecutive quarters of earnings growth and an expanding market share, the firm expects this year to mark the beginning of a narrowing gap between the company's performance and its stock price. The investment opinion remains 'Buy,' with a target price of 48,000 won.

CJ Freshway's fourth-quarter sales last year are estimated at 903.5 billion won (up 6.3% year-on-year), with operating profit at 29.1 billion won (up 15.5%). Double-digit profit growth is expected for the second consecutive quarter.

Nam Sung-hyun, a researcher at IBK Investment & Securities, cited several factors for the positive outlook: ▲ a low base effect due to the December 2024 martial law; ▲ the impact of government-issued consumption coupons; ▲ strong performance at the Incheon Airport concession (Gourmet Bridge) driven by increased demand from inbound foreign tourists and outbound domestic travelers; ▲ new group catering contracts and improved profitability; and ▲ enhanced profitability through diversification of online channels and demarketing.

Nam added, "Despite the low base, the dining-out market was not particularly strong in the fourth quarter. Nevertheless, franchise-oriented sales in the dining-out segment drove overall growth, and new group catering contracts are expected to deliver stable results."

The expansion of CJ Freshway's market share is expected to continue this year. Last year, the company implemented vertical integration of its logistics and transaction structure through the merger with Fresh One. This year, synergies from the use of key distribution networks and online channels are anticipated.

Nam noted, "CJ Freshway has begun to actively strengthen its online supply channels (including Sikbom, its own mall, and open markets), and with its overwhelming logistics infrastructure, there is a high likelihood of expanding its penetration. Targeting relatively small and medium-sized channels is also becoming much easier."