Kiwoom Securities said on the 20th that a recovery in earnings for Cosmecca Korea in the second half of the year is likely, recommending bottom fishing. It maintained a buy rating and a target price of 85,000 won. The closing price for Cosmecca Korea on the previous trading day was 59,200 won.
Researcher Jo So-jeong from Kiwoom Securities noted, “As domestic and U.S. entities drive earnings growth, a rebound in performance is expected from the third quarter (July to September),” adding, “In Korea, delayed order volume from the first half will lead to visible growth.”
Orders from global clients could be a variable driving additional growth. Researcher Jo explained, “These clients often have large order volumes, so if actual orders are placed, sales could further expand.”
Additionally, it appears that orders are expected to increase as major U.S. clients enter the final stages of inventory depletion,” she added. “Sales decreased due to delays in inventory depletion centered around indie beauty brands, but related issues are gradually being resolved.”
Currently, the stock price stands at a price-to-earnings ratio (PER) of about 12 times, and Researcher Jo believes that this makes it attractive from a valuation perspective.
Researcher Jo noted, “The second quarter of this year is a period to confirm the bottom of performance, and market interest will shift toward growth in the second half of the year,” adding, “Expectations for guidance in the second half will likely drive stock price movements more than short-term earnings, and as a recovery in performance seems likely, bottom fishing is recommended.”