K-Pop

YG’s Target Stock Price Revised Downward Due to BLACKPINK’s Impact

“BABYMONSTER’s debut is expected to partially offset BLACKPINK’s hiatus”

On November 27th, as BABYMONSTER debuted, Yuanta Securities lowered the target stock price for YG Entertainment from 75,000 to 65,000 won.

Yuanta Securities analyst Lee Hwan-wook said, “Next year’s expected sales and operating profit of YG are projected to decrease by 32.7% and 51.5% compared to the previous year, amounting to 369.3 billion won and 46.1 billion won, respectively.” 

He explained, “Excluding YG’s representative artist IP BLACKPINK, a downturn compared to the previous year is inevitable.”

The analyst added, “Next year, the combined album sales of YG-affiliated K-pop IPs are expected to decrease by 18.7% compared to the previous year, reaching 4.26 million units.” 

He added, “The sales of BABYMONSTER are expected to partially offset BLACKPINK’s hiatus.”

Furthermore, he anticipated, “YG’s performance growth in the streaming sector in 2024 will either slightly increase by 0.5% or show stability compared to the previous year. However, the annual total number of recruits is expected to be around 600,000, resulting in a significant decrease of 73.0% to around 29.5 billion won in revenue compared to the previous year.”

blackpink

Despite lowering the target stock price assuming no renewal of BLACKPINK’s contract, Yuanta Securities maintains a ‘buy’ investment opinion, citing the foundational strength of over 100 billion won per quarter and BABYMONSTER’s global popularity and growth potential.

BABYMONSTER secured the top spot on the worldwide YouTube chart for two consecutive days with their debut single ‘BATTER UP.’ They also entered the top 3 and top 7 on the popular music video charts in the US and the UK, respectively.

As of 9:03 AM KST on November 30th, YG Entertainment is trading on the KOSDAQ market at 51,800 won, a 0.77% decrease from the previous trading day.

Source: daum

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