Silicon2 seen as undervalued relative to growth despite currency headwinds... Cosmax poised to enter the era of 900 billion won in quarterly sales next year [Stocktopia]

[Financial News] We’re bringing you a roundup of reports from major securities firms on the morning of November 12.
Silicon2 was assessed as undervalued relative to its growth potential: its Q3 operating profit fell short of market expectations due to the stronger won, but its sales regions are expanding.
After posting its highest-ever quarterly results in Q3, Cosmax is forecast to enter the era of 900 billion won in quarterly sales next year. NC (formerly NCSoft Corporation) exceeded lowered market expectations for Q3 operating profit, but revenue from its existing games is declining faster than expected, prompting analysts to recommend waiting for results from new releases before investing.
◆ Silicon2 (257720)― KIWOOM Securities Co., Ltd. / Analyst Son Ye-bin
- Target price: 47,000 won (cut 19.0%, from 58,000 won) ᅵ Previous close: 26,700 won
- Investment rating: Buy (maintained)
KIWOOM Securities Co., Ltd. lowered its target price for Silicon2 to 47,000 won but maintained its Buy rating, citing the company’s medium- to long-term growth potential from regional expansion.
It viewed the current share price as “undervalued relative to the growth potential from regional expansion, even taking currency headwinds into account.” The target-price cut reflects a lower price-to-earnings ratio (PER) used in calculating the target.
Silicon2’s Q3 revenue came to 424.4 billion won, setting a new high for the seventh consecutive quarter. Operating profit, however, was 69.6 billion won, 15% below market expectations, largely because the stronger won reduced the gross margin.
Analyst Son Ye-bin forecast that “the burden from the stronger won will persist in Q4,” but said that “the drivers of top-line growth are actually broadening.” In North America, the company is discussing store placements with Walmart Inc. and Costco, which are expected to contribute to earnings starting in 2027. It has also completed the establishment of subsidiaries in Brazil and Japan, the analyst said.
◆ Cosmax (192820)― NH Investment & Securities / Analyst Jung Ji-yun
- Target price: 385,000 won (raised 4.1%, from 370,000 won) ᅵ Previous close: 263,000 won
- Investment rating: Buy (maintained)
NH Investment & Securities raised its target price for Cosmax to 385,000 won, saying the cosmetics contract development and manufacturing company posted its highest-ever quarterly results in Q3.
Cosmax’s consolidated Q3 operating profit rose 95% year on year to 83.3 billion won, beating raised market expectations by 7%.
Analyst Jung Ji-yun noted that Korean cosmetics exports rose 57% in October and 64% from November 1 to 10, and forecast that Q4 sales at the Korean entity on a standalone basis would significantly exceed previous estimates. Regarding the U.S. entity, the analyst said, “Its earnings structure is expected to continue improving as quarterly sales volume in the U.S. expands.”
Jung described this as “clear quantitative and qualitative growth” and forecast that quarterly sales would reach 900 billion won in 2027. The analysis said that revenue growth at the Korean entity is occurring alongside improved earnings at overseas entities.
◆ NC (036570)― Korea Investment & Securities / Analyst Ho Yoon Jung
- Target price: 300,000 won (cut 23.1%, from 390,000 won) ᅵ Previous close: 209,000 won
- Investment rating: Buy (maintained)
Korea Investment & Securities lowered its earnings estimates and cut its target price for NC to 300,000 won, saying revenue from the company’s existing games is declining faster than expected.
NC’s Q3 operating profit was 119.6 billion won, exceeding lowered market expectations. However, revenue from Lineage Classic has been naturally declining since its release, and revenue from Aion 2 also fell from the previous quarter.
Analyst Ho Yoon Jung said, “The performance of future releases is uncertain, but declining revenue from the existing lineup is already a reality.” Jung added, “I recommend looking for buying opportunities while checking the release schedules and actual performance of highly anticipated titles such as Horizon.”

[email protected] Seong Min-seo Reporter