[THE INVESTOR] Korean internet giant Kakao will show strong growth momentum in 2019 after its weak performance in the fourth quarter last year, KB Securities said on Jan. 15.
The brokerage maintained a “buy” recommendation and a target price of 135,000 won (US$120.45).
Kakao’s revenue in the fourth quarter is estimated to reach 651.8 billion won to show a 19.7 percent on-year rise. Its quarterly operating profit is expected to fall 31.7 percent to 23.9 billion won, according to KB Securities analyst Lee Dong-ryun, who cited snowballing marketing costs as a key factor.
This year, KakaoTalk-focused advertisements and new services, such as carpool, and cost-control efforts will are likely to contribute to revenue improvement.
“Kakao Mobility is likely to reap profits, and more investment in premium video contents will happen this year,” he noted.
By Yoon Yeun-jung (firstname.lastname@example.org)