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Bumsoo Kim, founder of Kakao. (Photo = Yonhap news) |
[Alpha Biz= Reporter Paul Lee] On the 10th, Samsung Securities stated that in order for Kakao to rebound in stock price, it needs to first discover new growth momentum and resolve legal risks.
In its report on the day, Samsung Securities lowered Kakao's target stock price by 10.6% from the previous level to 59,000 won. Considering that most securities firms have set Kakao's target stock price in the range of 60,000 to 70,000 won, Samsung Securities stands at the lowest end in the securities market.
Explaining the consideration of the slowdown in growth of existing services, Samsung Securities applied a target price-to-sales ratio (PSR) of 2.8 times to this year's expected net sales.
This valuation takes into account the average PSR of global platform companies this year, applying a discount rate of 35% considering the difference in profitability.
Samsung Securities anticipated, "Given that Kakao currently needs to address various challenges such as discovering new growth momentum, optimizing company-wide costs, and resolving legal risks, it will take time for a substantial stock price rebound."
Kakao's first-quarter performance showed a slowdown. While platform-related revenues such as Pay and Mobility increased by 24.3% compared to the same period last year, most businesses such as advertising, commerce, gaming, and Story recorded single-digit growth rates or early double-digit growth rates.
AlphaBIZ Paul Lee(hoondork1977@alphabiz.co.kr)
