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(Photo= Yonhap news) |
[Alpha Biz= Reporter Kim Sangjin] As of November 11, according to the Korea Exchange, Naver (NAVER) closed at 173,300 won, marking a 0.52% increase from the previous trading day. This marks a third consecutive day of gains since November 8.
Naver began trading that day at 172,900 won, briefly rising to 173,500 won before closing slightly lower. This month, Naver has seen a rise of 5,100 won (3.03%), climbing from 168,200 won on November 2 to 173,300 won.
Kakao has also shown signs of recovery recently, closing at 37,400 won, up 0.13% from the previous day. The stock has steadily increased with fluctuations of 0-1% since the start of November, up from 36,000 won on November 2.
Analysts attribute this uptick to rising expectations for a rate cut ahead of the Bank of Korea's monetary policy meeting, as both Naver and Kakao are considered representative growth stocks. Typically, growth stocks perform well in periods of declining interest rates.
Analysts expect solid performance in Q3 and Q4, indicating that the company is entering a stabilization phase, with its commitment to enhancing shareholder returns positively impacting its stock price.
Eugene Investment & Securities, noted, "The external environment for the company's business segments is still not very favorable, but it is maintaining growth through the effects of advertising restructuring and expanded e-commerce profitability. Given that the cost control trend is also ongoing, a valuation rebound due to profit growth is expected."
In contrast, Lee Jun-ho from Hana Securities observed, "Despite Naver achieving record performance in the first half and announcing a special stock buyback and cancellation, its returns have been disappointing. Although profits are trending upward due to growth in the search platform and enhanced cost efficiency, the stock price has not followed suit."
On the other hand, analysts have issued negative reports regarding Kakao. Ahead of the Q3 and Q4 earnings announcements, firms like Korea Investment, Kiwoom, Daol, and NH Investment Securities have lowered their target prices for Kakao.
Daol Investment & Securities stated, "The growth rate of the core business is on a downward trend, and the poor performance of content subsidiaries has worsened the overall results. While there may be advantages in supply and demand, it is difficult to overlook the ongoing legal risks."
Korea Investment & Securities commented, "With the decline in revenue growth rates due to poor performance in the content business, overall profitability is also deteriorating. While profits, which have been declining since 2021, are expected to gradually recover by 2025, there are still burdens from high valuations compared to global competitors and unsteady top-line growth."
Alphabiz Reporter Kim SangJin(letyou@alphabiz.co.kr)
