April 24, 2024

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[THE INVESTOR] Jeju Air’s third-quarter earnings will be disappointing, said NH Investment and Securities on Oct. 19 lowering the target price to 41,000 won (US$36.00) from 58,000 won.

Its revenue in the period will come in at 320.6 billion won with operating profit of 34.1 billion won, missing market consensus, but thanks to the relatively superior cost structure, its profit margins will be solid. Moreover, Korea and China are set hold working-level talks on aviation in November. If the talks lead to mid- to long-term expansion in routes to China, the low-cost carrier could enjoy growing demand in passenger traffic, said analyst Jeong Yeon-seung. 

Its current stock price preemptively reflects recent unfavorable factors, the analyst noted maintaining a “buy” recommendation. 

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