[Click eStock] "SK, First Year of Performance Turnaround... Target Price Raised from 760,000 Won to 1,000,000 Won"

Heungkuk Securities announced on the 24th that it has raised its target price for SK from 760,000 won to 1,000,000 won.

Jongryul Park, a researcher at Heungkuk Securities, explained in a report on SK released that day, "We are raising the target price due to an increase in the equity value of major subsidiaries such as SK Square, SK Telecom, and SKC, as well as adjustments to the discount rate versus NAV."

Park analyzed, "The year 2026 will mark the first year of a full-fledged performance turnaround for SK, driven by strong results from SK Square and significant profit growth contributed by SK Innovation and SK Telecom. With solid earnings momentum and expanded shareholder returns, the stock price revaluation is likely to be sustainable."

The key investment points include: the full-scale performance turnaround in 2026; enhancement of corporate value through portfolio rebalancing; recovery of core subsidiaries' earnings and normalization of dividends; entry into a phase of improved and stabilized financial structure; and structural reduction of the discount rate through strengthened shareholder return policies.

SK is projected to record consolidated sales of 31.1 trillion won and operating profit of 3 trillion won in the second quarter. Compared to one year ago, this represents a 3.3% increase in sales and a return to profitability in operating profit.

Park stated, "SK Square is expected to continue posting strong semiconductor results, while SK Innovation will show steady growth trends due to inventory-related profits from rising oil prices. Most subsidiaries, including SK Telecom, SK Networks, and SKC, are forecasted to exhibit solid performance. SK Ecoplant’s profitability is also expected to improve significantly due to the increased proportion of high-margin semiconductor business."

Accordingly, a significant full-year performance turnaround is also anticipated. Heungkuk Securities revised its forecast for SK’s annual consolidated sales to 131.1 trillion won, a 7% increase year-on-year, and operating profit to 18.1 trillion won, up 1,295.1% from the previous year.

Shareholder return is also expected to strengthen. Park mentioned, "As part of the shareholder return policy, SK plans to retire 20.3% of its treasury shares (out of a 24.8% stake) on January 4, 2027, excluding a portion reserved for employee compensation."

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