Experts Downgrade YG’s Target Price by 19% Due to BLACKPINK’s 2025 Comeback Forecast
Kiwoom Securities lowered the target price of YG Entertainment by 19% on March 12th.
This is due to the forecast that BLACKPINK will make a comeback as a full group in 2025.
Lee Nam-soo, a researcher at Kiwoom Securities, analyzed, “From the third quarter of 2022 when the full lineup of BLACKPINK was active until the third quarter of 2023, it is estimated that they achieved sales of around 270 billion won through 5 quarters of new and old albums totaling 3 million copies, streaming and YouTube settlements, world tour tickets and concert MD, advertisements, and appearances.”
He added, “Considering that BLACKPINK’s contribution to the artist segment revenue is at the 60% level, it is evaluated to be even higher when considering the scale of economic productivity.”
Reflecting the absence of BLACKPINK’s activities this year, Kiwoom Securities adjusted the target price from the previous 85,000 won to 69,000 won.
The researcher explained, “Assuming a comeback in 2025 reflecting the individual activities of BLACKPINK, a target price earnings ratio (P/E) of 30 times the expected consolidated net profit for 2024 was applied.”
However, Kiwoom Securities estimated that YG’s second and fourth quarter sales this year would be close to those when BLACKPINK is active due to simultaneous activities of BABYMONSTER and TREASURE.
The researcher forecasted, “Streaming and copyright revenue, as well as K-content appearances and advertisements for actor management, and the distribution of YG and HYBE albums through YG Plus, will support performance strength.”
Source: daum
