‘New low price’ despite Naver’s purchase of CEO Choi Soo-yeon… 10% valuation loss
While Naver recently announced sluggish earnings, it broke a 52-week low during the day. CEO Soo-yeon Choi purchased the company’s stock to prevent the stock price from falling, but suffered a valuation loss.
On April 25, Naver finished trading at 288,500 won, down 3.83% from the previous trading day. On the same day, the stock fell 4% to 288,000 won, breaking a 52-week low. The stock price of Naver has continued to decline since the 21st. On the 22nd, it fell below 300,000 won during the day, increasing the extent of the decline.
The decline in Naver’s stock price started after the earnings announcement on the 21st. On the same day, Naver announced that in the first quarter of this year, consolidated sales increased 23.1% year-on-year to KRW 1.84 trillion, and operating profit increased by 4.5% to KRW 301.8 billion. However, according to FnGuide, a financial analysis company, Naver’s current performance is far below the estimates, with sales of 2.295 trillion won and operating profit of 378.5 billion won. Accordingly, immediately after the earnings announcement, securities companies all at once lowered the target price of Naver.
Meanwhile, Naver’s new CEO Soo-yeon Choi and Chief Financial Officer Nam-seon Kim recorded valuation losses during this downtrend. CEO Choi and CFO Kim, who took office on March 14, bought 314 shares of Naver each on March 21 to express their commitment to responsible management in the face of the recent share price decline. The purchase price of the shares is 190 million won each. As the closing price of Naver fell to 300,000 won on April 22, they recorded a valuation loss of 13.3% and 13.5%, respectively. CEO Choi, who purchased stocks at 346,000 won per share, lost about 14 million won. CEO Kim, who purchased the stock at 347,000 won per share, lost about 15 million won.
However, the securities industry is cautiously predicting a rebound in Naver’s stock price. Kim Dong-woo, an analyst at Kyobo Securities, said, “Despite the slowdown in the domestic e-commerce market, Naver saw a 78% increase in service transaction volume compared to the same period last year through new services such as brand stores, shopping live, and gift giving. The results are expected to improve compared to the first quarter.” Hwang Hyun-joon, an analyst at DB Financial Investment, also said, “Although profitability fell in the first quarter of this year, Naver still maintained its dominance in the domestic e-commerce market. It is expected to be a factor.”
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