Hana Securities Simultaneously Lowers Target Prices for HYBE, SM, JYP, and YG

Hana Securities has simultaneously lowered its target prices for the four major entertainment agencies: HYBE, SM, JYP Entertainment, and YG Entertainment.

On June 10, Hana Securities stated in its report titled "Entertainment, Can't Stand These Prices" that "the gap between current share prices and target prices is too large, so we are lowering the target prices for all four agencies."

The target price for HYBE was reduced from 400,000 won to 350,000 won. SM's target price was lowered from 140,000 won to 124,000 won. JYP Entertainment's target price was adjusted from 90,000 won to 79,000 won, and YG Entertainment's from 76,000 won to 63,000 won.

Lee Kihun, a research analyst at Hana Securities and author of the report, explained, "For HYBE, we revised our 2027 earnings estimate due to all members of SEVENTEEN enlisting in 2026 and the group's full return in 2028. However, in 2028, large-scale tours by SEVENTEEN, NewJeans, Cat's Eye, and KOR:TIS are expected to contribute an additional 500 billion to 600 billion won in revenue from these groups alone."

Regarding the other three agencies, Lee noted, "We have lowered the target P/E ratio to 22 times. For SM and JYP, a 10% discount was applied, while for YG, a 10% premium was added based on the 2027 outlook without BigBang."

As of the previous day's closing prices, HYBE's share price stood at 206,500 won, SM at 73,300 won, JYP Entertainment at 53,500 won, and YG Entertainment at 41,150 won.

The most important factor for a rebound in entertainment stock prices going forward is expected to be HYBE’s second quarter earnings. Accordingly, there are forecasts of a strong rebound after August.

Lee assessed, "The share price has continued to decline due to concerns over the profit distribution ratio for BTS, but once the second quarter results are confirmed, the performance range for the second half—which is when BTS contributes a high portion of revenue—will become clearer. Furthermore, there is a high likelihood that NewJeans will make a comeback as a four-member group before October at the latest, and given NewJeans’ status as a core fourth-generation group, this could serve as a trigger for a rebound depending on their performance."

He added, "If HYBE resolves its extreme undervaluation, the other three agencies are also likely to attempt a rebound. In the short term, SM's price is excessively undervalued, and depending on the performance of new artists in September, YG could see a high beta in its upward movement."

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