Yuanta Securities has raised its target price for APR by 42.1% to 540,000 KRW (about 367 USD) on April 27, citing improved growth prospects through expansion in U.S. and European markets. The firm maintains its Buy recommendation.
Analysts at Yuanta Securities project APR’s first-quarter operating profit to reach 140 billion KRW (about 95 million USD), in line with market expectations of 139.1 billion KRW (about 94.4 million USD).
Despite the first quarter typically being a slower period, U.S. sales are expected to maintain levels comparable to the previous quarter, which included the lucrative Black Friday and Christmas shopping seasons.
Lee Seung-eun, a research analyst at Yuanta Securities, noted that rising fuel costs have extended maritime shipping times, leading to an increased reliance on air freight. However, the company continues to prioritize revenue opportunities over cost concerns. Lee added that while the potential for duty refunds has been acknowledged, specific guidelines from U.S. customs are still pending. This represents a short-term uncertainty but doesn’t undermine the company’s long-term growth trajectory.
The analyst predicts sustained growth momentum driven by channel expansion in the U.S. and Europe. Consequently, Yuanta Securities has revised its estimates for APR’s annual revenue and operating profit upward to 2.55 trillion KRW (about 1.73 billion USD) and 625 billion KRW (about 424 million USD), respectively.
Lee emphasized that the latter half of the year is poised to be a pivotal period for market revaluation, as the expansion of U.S. grocery channels coincides with Sephora’s growth in Europe. This marks the beginning of a new phase in the company’s structural growth story.