Brokerages, including major rivals, have collectively raised their target prices for NH Investment & Securities (005940.KS) after the firm posted first-quarter earnings that significantly exceeded market consensus.
According to financial data provider FnGuide on Thursday, Korea Investment & Securities issued a research report that day raising its target price for NH Investment & Securities to 42,500 won from 36,000 won, an 18% increase. NH Investment & Securities closed at 34,950 won the previous day.
"The duration of the stock market boom and its positive spillover effects across various business divisions are greater than initially expected," said Paik Doo-san, an analyst at Korea Investment & Securities. "We are raising our estimate for this year's average daily trading value by 7% to 56.2 trillion won."
On the previous day, NH Investment & Securities disclosed that it recorded first-quarter operating profit of 636.7 billion won ($466 million) and net profit of 475.7 billion won ($348 million). The figures surged 120.3% and 128.5%, respectively, from a year earlier, marking record highs for a single quarter. Earlier, the brokerage industry had forecast NH Investment & Securities' first-quarter operating profit and net profit at 534.4 billion won and 394 billion won, respectively, which the firm exceeded by 19.1% and 20.7%.
Shinhan Securities also raised its target price for NH Investment & Securities in a report that day, lifting it to 44,000 won from 40,000 won. "NH Investment & Securities delivered an earnings surprise that significantly exceeded expectations," said Lim Hee-yeon, an analyst at Shinhan Securities. "Attention should also be paid to its enhanced profit capacity and the additional leverage potential from its entry into the integrated management account (IMA) business."
In addition, major domestic brokerages including SK Securities, Kiwoom Securities, and KB Securities adjusted their target prices for NH Investment & Securities to above 40,000 won. The three-month consensus target price for NH Investment & Securities stands at 40,361 won.
