SK Securities maintained its "buy" rating on JYP Entertainment (KOSPI: 035900) on the 21st, while lowering its target price from 92,000 won to 75,000 won.
The revised target implies an upside of 68.2% from the current share price of 44,600 won. The cut reflects a lower valuation multiple applied to the entertainment sector, amid waning investor interest in the industry. The new target is based on a price-to-earnings ratio of 18.6 times applied to a 2026 earnings-per-share estimate of 4,026 won.
Analyst Park Jun-hyung at SK Securities estimates second-quarter revenue at 190.78 billion won, down 11.6% year on year, and operating profit at 38.22 billion won, down 27.8% year on year, implying an operating margin of 20.0%. Both figures fall short of market consensus — by 5.9% and 9.5% respectively.
The primary driver of the earnings downgrade is the deferral of revenue recognition. Proceeds from TWICE's North American tour and online merchandise sales from Stray Kids' fan meetings have been pushed into the second half of the year. In the albums segment, five new releases centred on newer, less-established artists were launched during the quarter, but each sold fewer than 500,000 copies, meaning fixed costs will weigh more heavily on margins.
The second half of the year looks considerably more promising. A Stray Kids comeback and world tour are both scheduled, with Asian concert dates already confirmed through the first quarter of next year. Additional dates covering North America, Europe and other regions are expected to be announced. As a result, merchandise revenue from the world tour and deferred fan-meeting sales are forecast to be recognised in earnest in the latter part of the year.
For the full year 2026, SK Securities projects revenue of 890.5 billion won, up 8.4% year on year, and operating profit of 180.2 billion won, up 16.1% year on year. The stock's 12-month forward price-to-earnings ratio currently stands at around 11 times — near the bottom of its historical trading range.