[Infostock Daily= Reporter An Hoe Hyun] Shinhan Investment raised its target stock price of Megastudy by 6% from 50,000 won to 53,000 won on the 22nd, saying the spread of the COVID-19 has calmed down and its performance is expected to recover next year due to the normalization of offline institutes. The investment opinion remained 'Buy'.
"Megastudy's 129.4 billion won in sales in the third quarter of this year is expected to increase 2.4% year-on-year, but its operating profit is expected to fall 38.2% from the same time last year to 19.1 billion won," the company explained, adding, "High school sales are expected to grow backward 6.9% year-on-year to 85.9 billion won."
"Despite the growth of the online sector, the offline sector has been affected by the second and third stages of social distance," the company said, adding, "Due to the nature of offline academies with a high proportion of fixed costs, reverse growth is expected due to large recruitment profits despite a slight drop in sales."
However, as the recent spread of COVID-19 has calmed down, the social distance has been lowered to the first level since October 12, and the rise in the registration rate for offline institutes has been confirmed due to the relaxation of the distancing.
"Until this year, it spent a lot of marketing expenses to expand recognition and appearance," the company explained, adding, "Starting next year, marketing spending will be reduced and the full-fledged profit leverage effect will be reflected."
Reporter An Hoe Hyun ahh@infostock.co.kr
