[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.
