April 20, 2024

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[THE INVESTOR] Naver’s earnings next year will be inevitably low, said NH Investment and Securities on Oct. 26 lowering the target price to 150,000 won (US$131.96) from 180,000 won.

Its revenue in the third quarter increased 16.4 percent on-year to 1.4 trillion won while operating profit fell 29 percent to 221.7 billion won, missing market expectations. Its personnel and marketing costs continue to rise and losses are swelling due to aggressive investments by its subsidiary Line. Operating profit will not be able to improve for the time being, said analyst An Jae-min. 

The internet giant’s 2019 operating profit will decline 2.3 percent from this year to 939.8 billion won and LINE will turn to red. From the second half next year, though, it will begin to rebound as results from advertising, commerce and fintech will begin to show, said the analyst maintaining a “buy” recommendation.

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