A Big Smile as KOSPI Hits Record High... Target Price Raised for This Stock Amid Surging Earnings [Weekend Money]

Trading Profits Improve Amid Bullish Market
Target Price Raised to 516,000 Won

Kiwoom Securities has seen its investment rating and target price raised due to expectations of improved performance amid a bullish stock market. Analysts predict that both earnings and shareholder returns will continue to show positive trends, driven by better-than-expected results in trading and product income.

Taejun Jeong, a research analyst at Mirae Asset Securities, stated, "We are upgrading our investment rating on Kiwoom Securities from Neutral to Buy, and raising the target price from 466,000 won to 516,000 won."

He continued, "While the target dividend yield applied in the target price calculation remains unchanged at 3.0%, the expected dividend per share for 2026 has been raised from 14,000 won to 15,500 won. This is because we expect trading and product income to remain strong as the stock market continues to boom." The upside potential was presented at 21.8%.

The company’s performance also exceeded market expectations. In the first quarter of this year, Kiwoom Securities recorded a net profit attributable to controlling shareholders of 476.4 billion won, surpassing both securities firms' estimates and market forecasts.

Jeong analyzed, "Brokerage commission income was in line with estimates, and while corporate finance and other commission income as well as interest income fell short of projections, trading and product income and other profit were better than expected."

However, some market indicators remain weak. The share of individual trading volume and credit extension market share have continued to decline. Although the overall market size has expanded, resulting in increases in investor deposits and outstanding credit extensions, the issue of insufficient credit limits seems to have had an impact.

Jeong noted, "As the overall market grows, both investor deposits and outstanding credit extensions have increased, but the problem of insufficient credit limits appears to persist."

Expectations for shareholder return policies also remain high. Kiwoom Securities is expected to pay a cash dividend of 15,500 won per common share this year. This represents a payout ratio of 30% based on separate net profit, and 27% on a consolidated basis.

Jeong commented, "Management is aiming to meet the requirements for separate taxation of dividend income by 2027 and plans to announce a new shareholder return policy in May. However, I do not expect the new policy to result in a drastic expansion of returns." He added, "There is a clear need to expand capital, and management has stated that it will not pursue this through artificial capital increases."

He further added, "Given that the absolute level of valuation is not low, I believe the decision will be made to maintain a balance between growth and returns, focusing mainly on cash dividends."

This content was produced with the assistance of AI translation services.