April 20, 2024

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[THE INVESTOR] SK Networks’ earnings will be dented by restructuring and marketing costs in the second quarter, said Shinhan Investment on June 23, lowering the target price to 8,600 won (US$7.55) from 10,500 won.

Its operating profit will be slashed by 53.5 percent on-year to 18.1 billion won, as it spent 20 billion won in streamlining the company, estimated analyst Heo Min-ho. 

Its car rental and maintenance unit improved after struggling in the first quarter but the competition in car rental market may heighten with Hyundai Motor Group’s rumored acquisition of AJ Rent a Car, pointed out the analyst.

Heo maintained a “buy” recommendation, however, saying that its operating profit will pick up in the third quarter as sales margin of oil will rebound and marketing costs will be cut while car rental and maintenance will improve.

By Hwang You-mee (glamazon@heraldcorp.com)