JYP & SM Executives Purchased Additional Shares To Protect Stock Prices While YG’s CEO Made Irresponsible Move
According to Korea Exchange on January 18th, YG Entertainment’s stock price ended at 43,000 won. Despite a rebound of 5.39% compared to the previous day, the stocks are still on a downward trend since the beginning of the year. Due to concerns over BLACKPINK’s contract renewal, foreign investors began to sell their shares due to distrust in K-entertainment management.
In particular, YG’s CEO & CFO Hwang Bo-kyung sold 4,000 shares on December 15th, 2023. Executives often sell their shares due to personal financial needs, but investors consider it a negative factor. CEO and executives of YG reportedly sold their shares shortly before the official announcement of the negative that YG failed to extend individual contracts with BLACKPINK members on the 29th.
Foreign investors were also sensitive to this behavior. Within the beginning of this year, foreign investors have sold approximately 174 million won worth of YG shares. As such, negative evaluations of YG’s stock performance continued to pour out. The target price for YG stock predicted by the investment industry has dropped significantly, from 97,000 won 3 months ago to 75,000 won.
While YG is out of control over its stock price, its rivals JYP and SM are quickly taking action. According to reports of the Financial Supervisory Service on the same day, singer Park Jin-young, the COO and largest shareholder of JYP, purchased an additional 62,000 shares of JYP stocks with an estimated amount of 5 billion won. As a result, Park Jin-young’s ownership of JYP increased from 15.22% to 15.37%. Immediately after that, investors showed positive reactions and trust in Park Jin-young. In fact, the largest shareholder’s stock purchase is interpreted as a positive signal for stock prices.
The same goes for SM. Lawyer Kim Tae-hee, an outside director of SM, purchased 1,000 SM shares additionally on December 28th, 2023. The purchase of an outside director is also seen as a positive signal. Kakao’s acquisition of SM last year caused a big stir, but if uncertainties are resolved, SM can see a rebound in stock prices at any time.
YG is placing hope on BABYMONSTER. Hana Securities researcher Lee Ki-hoon shared, “The scale of concert tour must be confirmed until BLACKPINK’s next comeback, which is expected to happen between the second and third quarters of this year”, adding “The growth of BABYMONSTER with two comebacks in the first half of 2024, according to predictions, is also important”. However, it was pointed out that BABYMONSTER’s activities with a lack of promotion received negative opinions and reactions lower than expectations.
Some are guessing that YG stock price is gradually reaching the bottom. NH Investment & Securities researcher Lee Hwa-jung said, “There are currently no expectations for BLACKPINK’s activities. Only the success of BABYMONSTER and TREASURE’s new albums as well as BLACKPINK resuming group activities could make a positive change to the situation”.
Source: Daum
