[Edaily Reporter Park Jung-Soo ] On the 23rd, DaishinSecurities assessed that NH INVESTMENT & SECURITIES(005940)remains highly attractive to investors based on its solid earnings and high dividend yield, despite the overall slump in the securities sector. The firm maintained its “Buy” rating and target price of 45,000 won. The closing price on the 22nd was 30,800 won.
Park Hye-jin, an analyst at DaishinSecurities, stated, “Although the recent slump in securities stocks has persisted, the likelihood of further declines is low given the company’s earnings,” adding, “The current price-to-book ratio (PBR) of 1x is significantly below the coverage average of 1.54x.”
In particular, the appeal of dividends was highlighted. DaishinSecurities estimated NH INVESTMENT & SECURITIES’ dividend yield for this year at 5.8%. The assessment is that while valuation concerns have eased due to the recent stock price correction, the appeal of high dividends has become even stronger.
Second-quarter earnings are projected to significantly exceed market expectations. DaishinSecurities expects second-quarter net income attributable to controlling shareholders to reach 4685억원, a 1.5% decrease from the previous quarter but an 82.5% increase year-over-year. This figure is approximately 20% higher than the market consensus of 3905억원.
The brokerage division is the key driver of this earnings improvement. With average daily trading volume in the second quarter expected to reach 89.6 trillion won—a 28.6% increase from the first quarter—brokerage commission revenue is projected to surge to 510.4 billion won, up 27.6% quarter-over-quarter and 214% year-over-year.
The Wealth Management (WM) division is also expected to show robust performance. With ample liquidity in the capital markets, sales of investment products such as wrap accounts and funds are expected to remain strong, and related commission revenue is projected to stay at a high level.
The Investment Banking (IB) division is also expected to generate stable earnings, driven by the execution of numerous deals, including the issuance of corporate bonds by KYOBOSECURITIESCO.,LTD. (4700억원). IB revenue is estimated to reach 990억원, a 1.8% increase from the previous quarter.
Analyst Park stated, “While investment management gains and losses are expected to decline compared to the first quarter due to rising interest rates, the likelihood of posting a loss as in the past is low because positions were adjusted in advance.” He added, “Considering its robust earnings capacity and high dividend yield, this is a highly attractive investment within the securities sector.”