알파경제 - HYBE, YG, JYP and SM Face Target Price Cuts Despite Near KRW 1 Trillion Profit Outlook

Photo = HYBE

[Alpha Biz= Paul Lee] South Korea’s four major entertainment agencies—HYBE, YG Entertainment, JYP Entertainment, and SM Entertainment—are expected to post combined operating profits approaching KRW 1 trillion this year, yet their target stock prices have been lowered across the board amid concerns over the next generation of artists.

According to the Korea Exchange on April 13, HYBE closed at KRW 250,000, down 1.57% from the previous session, with its share price falling 7.75% over the past week. JYP Entertainment also declined 0.83%. In contrast, YG Entertainment and SM Entertainment posted weekly gains of 1.18%, supported by a broader rise in the KOSDAQ index.

Data from AI-based investment analytics platform Epic AI shows that the combined operating profit forecast for the four companies this year stands at approximately KRW 982.2 billion, bringing the industry closer to the “KRW 1 trillion operating profit era.” This marks roughly a tenfold increase compared to a decade ago, with most agencies expected to deliver record-high earnings.

Despite this strong earnings outlook, securities firms have lowered their target prices by roughly 10–20%. Eugene Investment & Securities cut its target price for SM Entertainment by 18.8% to KRW 130,000—the largest reduction among the four companies. HYBE’s target price was lowered by 15.6% to KRW 380,000, while YG Entertainment and JYP Entertainment saw their targets reduced by 13.3% and 9.3%, respectively.

Analysts attribute the downward revisions to concerns over a generational transition in K-pop. Third-generation acts such as BTS, BLACKPINK, and TWICE have drawn between 1.5 million and 5 million attendees per tour. However, newer fourth- and fifth-generation artists have yet to demonstrate comparable global draw, raising concerns about sustained growth momentum.

알파경제 Paul Lee 특파원(hoondork1977@alphabiz.co.kr)