Financial Experts: "Expectations high" for YG, "Concerning" for SM

Loooool

I was predicting the decline of SM for years, but there will be many people who will still deny it

Quote from Blue2012

Big Hit YG expectations are high... SM concerns for momentum and earnings

• 

...(January 18-March 19). During the same period, YG Entertainment recorded a profit of 5.96%, JYP Ent. -1.53% and SM -2.19%.

Metaverse is a combination of meta, which means virtual and transcendence, and universe, which means world and space. It is a broad concept that refers to a virtual world in which reality and unreality coexist.

Entertainment contents in the metaverse are inevitably developed, and as the non-face-to-face service is activated due to Corona 19, it is developing as a window of communication centered on Generation Z.

Expectations for YG Entertainment's growth potential are also high in the market. Black Pink, a girl group under YG Entertainment, also held a fan signing event last year through Naver's representative metaverse platform'Zeppetto'. At that time, 50 million fans flocked to ZEPETO, and they communicated with Black Pink through avatars.

YG, led by Black Pink, recorded an operating profit of 10.7 billion won, an increase of 1094.22% compared to the previous year, with IPs such as albums, music sources, and celebrity-related goods (MD), despite the full cancellation of offline performances due to Corona 19. The operating profit was 16.70% higher than the consensus.

YG's recent fair value consensus was 62,275 won, up 6.25% from two months ago. In addition, a number of securities firms recently raised YG's 1Q earnings forecasts. The 1Q operating profit consensus jumped to 6 billion won.

"YG has an artist and IP optimized for metaverse," said Lee Sun-hwa, a researcher at KB Securities. "YG is diversifying their profit model by operating a virtual exhibition hall (virtual reality map)."

JYP Entertainment, which has been showing steady results, has seen little change in its fair value consensus over the past three months.

The most worrying stock in the market is SM. SM recorded an operating profit of 6.5 billion won last year, a decrease of 83.92% from the previous year and a net loss for the second year in a row. In particular, in the fourth quarter of last year, operating profit was only 1.3 billion won, falling 77.47% below the consensus.

Intangible assets impairment losses and losses from associates and investments recorded a net loss of KRW 66.2 billion. As 38 affiliates are taking turns creating unexpected bad news, the possibility of predicting earnings is very low. As more brokerage firms lower their target price, the recent fair value consensus fell 5.85% from two months ago.

In-Hae Ji, a researcher at Hanwha Investment & Securities, analyzed that improvement is urgent, considering that "SM is not big among both the artist momentum and performance leading entertainment stocks." He added, “In order to recover share price momentum, we will need to present a high-margin model in terms of digital business.”

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It's all metaverse beneficiaries... Enter 4 companies with mixed views

Input 2021.03.18. 1:41 am

Reporter Cho Yong-seok

... Fair value rising, YG expectations

ahead of Black Pink ↑… 1Q11 outlook hosiljeok multi 'earnings shock "SM bigger concern ... “The situation where improvement is urgent”

[E-Daily Reporter Yong-Seok Cho] Amidst growing expectations for entertainment items, which are considered to be the key beneficiaries of the'Metaverse ' era, joys are striking among them. The market's expectations for the Big Hit ( 352820 ), which were controversial at the time of the public offering, are rising, while SM ( 041510 ) continues to be disappointed by the continuous earnings shock.

Expectations are also high for YG



Entertainment ( YG ). YG, with Black Pink in the lead , compared to last year with IPs such as albums, music sources, and celebrity-related goods ( MD ) despite the total cancellation of offline performances due to Corona 19It recorded an operating profit of 10.7 billion won, an increase of 1094.22 % . The operating profit is 16.70 % higher than the consensus .

Lee Seon-hwa KB Securities researcher " YG is optimized for the metaverse artists and IP holds" and "already black pink IP and the public to hold and music videos for the fan meet in virtual worlds based on the virtual exhibition (virtual reality We are diversifying our profit model, such as operating a map).”

YG 's recent fair value increased by 6.25 % compared to two months ago to a consensus of 62,275 won . More recently a number of brokerage YG and up to one quarter of the projections, for the past one quarter youngeopik consensus 60 eokwon month (as 27 compared million) 124.8 The upstream% or adjustment. JYP Entertainment, which has been showing steady earnings, has seen little change in its fair value consensus for the past three months.

The stock market is most concerned about is SM. SM recorded an operating profit of 6.5 billion won last year , a decrease of 83.92 % from the previous year , and net loss for the second year in a row. In particular, the consensus was 77.47 in the fourth quarter of last year.Operating profit ( 1.3 billion won) was only below % , and net loss of 66.2 billion won was recorded due to impairment loss on intangible assets and losses on associates and investments . As more brokerage firms lower their target price, the recent fair value consensus fell 5.85 % compared to two months ago .

In-Hae Ji, a researcher at Hanwha Investment & Securities, said, “The factors that lead entertainment stocks are either high artist momentum or good performance (valuation). Park Seong-ho, a researcher at Yuanta Securities, said, “As of the third quarter of last year, 38 affiliates alternately creating unexpected bad news, so the predictability of SM’s earnings is very poor.” I will do it.”

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YG needs to make Blackpink the directors of YG Entertaiment. They literally saved them from Seungri scandal and Investors running away from YG and even paying Louis Vuitton debt.

JYP PD needs to stop promoting himself and have artist comeback more. 1 quarter without any JYP comebacks are bad.

SM well tax evasion and scandals this year isn't helping either and Aespa need to comeback strong. Black Mamba has very underperformed.

Lol YG is now BP

Maybe if they gave us that exo cb

Quote from godkingteshub

I was predicting the decline of SM for years, but there will be many people who will still deny it

With a global pandemic impeding touring this is such a stretch, specially when most of their losses comes from investments on other businesses, comparisons to YG are tricky as well, specially when on 2019 they had the Burning Sun incident and many people were acting like they were falling down, it only makes sense that now YG is with profits after their horrendous 2019 performance and with the boom on album sales from Blackpink, but the reality is that YG is heavy Blackpink dependent rn and they won't have touring either for some time, and JYP is doing kinda good because they barely invest outside of their groups but I don't see how they are doing better than SM. The other two "big 3" companies are not doing better than SM at all. Not to mention EXO and Red Velvet were pretty much inactive last year except for some solo releases and the I&S subunit, and the fact that we don't know Aespa's selling potential yet (which is looking good btw). NCT pretty much hard-carried SM last year because of the circunstances with their album sales but there is so much a group debuted on 2016 and without the possibility of touring can do to sustain a big ass company which is constantly investing, evading taxes to then get caught and whose bigger investor commits embezzlement and tranfer money to private companies of his. But let's be real SM isn't going anywhere, on normal circustancies they would have multiple groups touring stadiums and arenas rn.

inb4 people say YG mediaplay again

By the way, u cant mediaplay stock analyst

in before company stans defend or write essays regarding this.

Seems like NCT couldnt hardcarry SM without touring. SM needs EXO and RV

Quote from babyjinx1221

in before company stans defend or write essays regarding this.

Inb4 company stans pretend this is a reflection of group performance. Anyone who talks about this at all good or bad are company stans lol.

Quote from JustWhatIThink

With a global pandemic impeding touring this is such a stretch, specially when most of their losses comes from investments on other businesses, comparisons to YG are tricky as well, specially when on 2019 they had the Burning Sun incident and many people were acting like they were falling down, it only makes sense that now YG is with profits after their horrendous 2019 performance and with the boom on album sales from Blackpink, but the reality is that YG is heavy Blackpink dependent rn and they won't have touring either for some time, and JYP is doing kinda good because they barely invest outside of their groups but I don't see how they are doing better than SM. The other two "big 3" companies are not doing better than SM at all. Not to mention EXO and Red Velvet were pretty much inactive last year except for some solo releases and the I&S subunit, and the fact that we don't know Aespa's selling potential yet (which is looking good btw). NCT pretty much hard-carried SM last year because of the circunstances with their album sales but there is so much a group debuted on 2016 can do to sustain a big ass company which is constantly investing, evading taxes to get caught and whose bigger investor commits embezzlement and tranfer money to private companies of his. But let's be real SM isn't going anywhere, on normal circustancies they would have multiple groups touring stadiums and arenas rn.

JYPE is much smaller than the other big 3 + BH/HYBE.

They only make idol music, have a small staff because of it and pull large % of net profits . Which then = the largest marketcap of the big 3. They dont have investments eating profits like SM/YG/HYBE

I don't understand these analysts.

SM was pretty inactive these las times, so how can they make money ? They got so much group under their agency, when they'll comeback they'll make money i'm not worried that much for them.

Same for JYP, they got no comebacks for Q1. Itzy, Day 6, NiziU all make a comebacks next month, they'll make money too. And their money maker twice is still not announced for comeback.

But YG please, +5%. With Blackpink the show, Treasure comeback and Rosé solo ? What a pity. They are the agency of the BIG3 the most in difficulty, they are dependent on a single group.

If you are looking at cards to potentially make the company stock pop, YGE has Big Bang and BlackPink, and SME has SNSD and EXO. If we could get some kind of safe global norm where live concerts could happen again, they both could pull in some good revenue.

As for JYPE, I am not sure if 2PM is enough to make their stock spike hard. It's looking like the company won't actually be in a position to grow if JYP himself obstructs/tries to keep the guy groups still on the roster small outside of 2PM...especially if there is enough demand to turn a good profit off of the music and get more product endorsements and sponsorships.

Quote from citron-icy

I don't understand these analysts.

SM was pretty inactive these las times, so how can they make money ? They got so much group under their agency, when they'll comeback they'll make money i'm not worried that much for them.

Same for JYP, they got no comebacks for Q1. Itzy, Day 6, NiziU all make a comebacks next month, they'll make money too. And their money maker twice is still not announced for comeback.

But YG please, +5%. With Blackpink the show, Treasure comeback and Rosé solo ? What a pity. They are the agency of the BIG3 the most in difficulty, they are dependent on a single group.

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i think u totally missed the point here.

These are commentaries by stock analyst. They recommend 'buy' 'hold' 'sell' at current market price. These commentaries are usually for people who look for capital gains by buying and selling at right time.

They dont look into the very very far future. It's short term focused

Quote from penguinsgg

JYPE is much smaller than the other big 3 + BH/HYBE.

They only make idol music, have a small staff because of it and pull large % of net profits . Which then = the largest marketcap of the big 3. They dont have investments eating profits like SM/YG/HYBE

Yeah I get their modus operandi but then I guess it's an unfair comparison because every company have their own priorities on how to spend, how to invest or how to just save money. Companies who spend on businesses with losses and don't stop doing it is for reasons such as long term vision, keeping connections or knowing we are on a pandemic and it's something temporary. I do think this pandemic affected SM the most among the big entertainment companies as some of their groups rn are heavily dependent on touring and for their amount of subsidiaries and investments.

Quote from gerrard174

i think u totally missed the point here.

These are commentaries by stock analyst. They recommend 'buy' 'hold' 'sell' at current market price. These commentaries are usually for people who look for capital gains by buying and selling at right time.

They dont look into the very very far future. It's short term focused

oh ok, thanks for the clarification

Quote from JaSida

YG needs to make Blackpink the directors of YG Entertaiment. They literally saved them from Seungri scandal and Investors running away from YG and even paying Louis Vuitton debt.

JYP PD needs to stop promoting himself and have artist comeback more. 1 quarter without any JYP comebacks are bad.

SM well tax evasion and scandals this year isn't helping either and Aespa need to comeback strong. Black Mamba has very underperformed.

i agree but also thank you for posting so i can see Damon's face bless your soul

I honestly don't even know why I said so much here about overall business when it's just about expectations of stocks lol, it's pretty much about how the investors see the company and expect it to perform, so overall I guess once a big name's comeback is announced the stocks will usually rise, so the easy answer will be that YG socks will rise when a BP comeback is announced, SM's when EXO makes a comeback, JYP's when Twice's... so yeah it's obvious why YG has the higher stocks of the big 3.

Quote from Blue2012

Not really.

While BLACKPINK is a big part of it, the music label is only one piece of the YG conglomerate.

Several of YG's subsidiaries are doing well including YG's financial arm YGInvestments who have been investing like crazy.

Financial experts have pointed to several factors for YG's financial outlook as pointed out here -->

Source

• YG + YGPlus Revenue in 2020:

  $230,500,000 + $96,757,000

  
  

  2020 Revenue: $327,257,000

  
  

  "...increased album sales, expansion into Japan and YG's cosmetics line establishing a joint venture in China which will improve profits. YG-produced tv drama hit record TV ratings (YGStudioplex). And YGPlus distribution of BH albums, digital and merch for future growth.

• BLACKPINK's continued activity

• TREASURE's expansion into Japan

• BIGBANG's return to activity

leads experts to maintain a BUY on YG and YGPlus stocks in 2021 where they expect YG's market cap to increase to 3-4 trillion Won."

YN Culture & Space...Naver and YG's new real estate development company...the new VFX/SFX venue being built with Naver and Big Hit on land owned by YG... YG Stage has signed and re-singed huge name actors...YGKPlus is probably the leading model agency in Korea at the moment...YGX Academy has a large number of students now...are only a few subsidiaries doing well.

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BP saved YG's face with the public tho so by default they're the companies face also many of us don't really care about YG side businesses so when it comes to music YG = BP now

Who cares! Just give us the music.

Sm on his way to exo and snsd for financial assistance through a comeback after shelving them for years:

EhmLsUMXcAAKJYK.jpeg

I love that we all agreed SM needs EXO.

Both YG and JYP have girl groups with official Zepeto avatars and SM doesn't.

It is about $1.99 to purchase an outfit inspired by BP, Twice, Itzy, (or Selena Gomez) not counting wig, shoes, socks, jewelry, and accessories. It's all about the microtransaction.

Please stop exaggerating the EXO situation. Half the group was/still is inactive because of military, what do you all expect? Literally all other SM boy groups went through the same thing at some point. This is not a conspiracy against EXO.

SM's main source of income has always been their groups' tours, especially Tvxq's dome and stadium tours in Japan and with all of their tours halted because of the pandemic it's only natural this would happen.

Quote from chounim

Please stop exaggerating the EXO situation. Half the group was/still is inactive because of military, what do you all expect? Literally all other SM boy groups went through the same thing at some point. This is not a conspiracy against EXO.

SM's main source of income has always been their groups' tours, especially Tvxq's dome and stadium tours in Japan and with all of their tours halted because of the pandemic it's only natural this would happen.

I agree, I feel like people just forgot EXO are literally in hiatus right now and there's not much they could do during a pandemic. I still stand by what I said though, EXO is arguably their biggest star and earner and SM needs them more than the other way around.

I do want to add something though, everyone always talks about TVXQ and how they bring in a lot of money from their tours but why does no one talk about the revenue that exo brings in from their sales? EXO was the reason that SM even got their best performing Quarter in history back in 2018 with EXO being their top earner.

Quote from Kireta

I agree, I feel like people just forgot EXO are literally in hiatus right now and there's not much they could do during a pandemic. I still stand by what I said though, EXO is arguably their biggest star and earner and SM needs them more than the other way around.

I do want to add something though, everyone always talks about TVXQ and how they bring in a lot of money from their tours but why does no one talk about the revenue that exo brings in from their sales? EXO was the reason that SM even got their best performing Quarter in history back in 2018 with EXO being their top earner.

Because tours make much more money than album sales. 2 nights at Tokyo Dome including all the merch sales can most likely eclipse all the revenue from a million seller album. And TVXQ has been the only boy group from SM to consistently hold highly successful dome and stadium tours in Japan.

Kireta I also don't agree that SM need EXO more than the other way around. Obviously SM needs the stream of income EXO provided, but let's not act like most of EXO's content which EXO-Ls are so proud of wasn't handed to them by SM with very minimal input from the members themselves.

And Half of SM biggest touring act almost just lost his career... Chile

Quote from chounim

Kireta I also don't agree that SM need EXO more than the other way around. Obviously SM needs the stream of income EXO provided, but let's not act like most of EXO's content which EXO-Ls are so proud of wasn't handed to them by SM with very minimal input from the members themselves.

we can agree to disagree I guess, I don't see anyone else in SM helping them bring in steady sales as much as EXO does. Also isn't revenue overall sales of goods and services? Obviously tours bring in more money but EXO doesn't just have album sales, their merch sales, streaming and tour numbers are just as good....

Also where did you get the minimal input from the members themselves from!? They are at the stage in their career where they get to choose their own tracks to be released, and they've been vocal behind the scenes about that type of concepts they want to release. Not to mention their solo albums have all been created from what they wanted. Suho's was involved in every single aspect of his album, from the artwork to the songs and he even wrote lyrics for it. EXO SC basically composed the whole 1bv album themselves with little from SM themselves.

Quote from gerrard174

Seems like NCT couldnt hardcarry SM without touring. SM needs EXO and RV

NCT only has high albums sell but it took a lot of money to produce its. NCT not strong in tour cf or streaming. They're not much cashback from SM heavily invest. i think SM is heavily Carr by their TV star like actor or variety just look at where did SM get cf.

Quote from bprevoluntion

NCT only has high albums sell but it took a lot of money to produce its. NCT not strong in tour cf or streaming. They're not much cashback from SM heavily invest. i think SM is heavily Carr by their TV star like actor or variety just look at where did SM get cf.

With album sales as massive as NCT, one would assume they will be able to sell concert tickets too. But amid pandemic, no concert can be held. Seems like NCT could get much from other areas such as CF and acting

Don't worry SM stans and haters..... NCT will save the company this year.

Quote from gerrard174

With album sales as massive as NCT, one would assume they will be able to sell concert tickets too. But amid pandemic, no concert can be held. Seems like NCT could get much from other areas such as CF and acting

This is not true album sell are heavily carry by collectors fandom not public. You can see this kind of fandom behaviour in jpop too. So one fan can buy multiple albums but they can't do that for tickets concert

and there you go the 2 years of efforts

they failed to kill YGE because of 1 group

Quote from wendii

And Half of SM biggest touring act almost just lost his career... Chile

Doubtful, japan likely doesn't care about this scandal at all, or even know about it

Quote from Kireta

we can agree to disagree I guess, I don't see anyone else in SM helping them bring in steady sales as much as EXO does. Also isn't revenue overall sales of goods and services? Obviously tours bring in more money but EXO doesn't just have album sales, their merch sales, streaming and tour numbers are just as good....

Also where did you get the minimal input from the members themselves from!? They are at the stage in their career where they get to choose their own tracks to be released, and they've been vocal behind the scenes about that type of concepts they want to release. Not to mention their solo albums have all been created from what they wanted. Suho's was involved in every single aspect of his album, from the artwork to the songs and he even wrote lyrics for it. EXO SC basically composed the whole 1bv album themselves with little from SM themselves.

I'm talking about EXO as a group not soloists or subunits. All SM soloists are much more involved in their solo albums than they're with their groups' albums. And the input EXO members have in their albums IS minimal no matter how you look at it. My point is both EXO and SM need each other. EXO provide the revenue and SM provide the quality content.

Quote from bprevoluntion

This is not true album sell are heavily carry by collectors fandom not public. You can see this kind of fandom behaviour in jpop too. So one fan can buy multiple albums but they can't do that for tickets concert

Don't worry about NCT, their album sales WILL be reflected on their tour tickets sales. They already have the most successful online concert in SM with 200k tickets sold.