Issues & Trends

"Naver Is Undervalued, But Kakao? Not So Sure"... Why Do Opinions Differ Even Amid 'New Low Humiliation'?

Mixed Sentiment on AI for Naver and Kakao… Naver “Increase Exposure,” Kakao “Lower Target Price” High Hopes for Naver’s New AI Business… Securities Analysts Call It “Affordable” Kakao Needs to Prove Its AI Revenue Model…Target Prices Lowered One After Another AI Advertising and AI Factories vs. Agent AI: A 'Discrepancy' in Monetization AI Performance in the Second Half Will Determine Neka's Valuation

Park Jung-Soo
2026-07-07 16:49:07
[E-Daily Reporter Park Jung-Soo ] While Naver (NAVER(035420)) and Kakao(035720)are positioning artificial intelligence (AI) as a future growth engine, evaluations from the securities industry are mixed. While Naver is viewed as having new business ventures—such as AI advertising and AI Factory—that will serve as fresh drivers of stock price growth, Kakao is lowering its target stock price, arguing that the monetization of its AI services still needs to be confirmed.
Image to aid understanding of the article (Source: ChatGPT)

According to MP Doctor on the 7th, Naver closed at 197,200 won, up 0.31% (600 won) from the previous trading day. The stock, which hit a 52-week high of 304,000 won during trading on the 1st of last month, fell to a 52-week low of 190,300 won during trading on the 26th of the same month. Although it has rebounded slightly since then, it remains near its bottom.
The securities industry, however, views this as a buying opportunity. Shin Eun-jeong, an analyst at DB Securities, commented, “Naver’s stock price has quietly returned to an affordable level,” adding, “With a 12-month forward price-to-earnings ratio (PER) of 17.4x, it is an attractive range even from a range-bound trading perspective.”
She predicted, “The introduction of generative AI advertising and the monetization of the AI Tab will begin in the second half of the year, and in the long term, the AI Factory business will gain full momentum,” adding, “The AI business will establish itself as a medium- to long-term growth driver.”
KB Securities also assessed that the current stock price does not yet reflect the value of the new AI business. Analyst Lee Ji-eun maintained her recommendation to increase holdings, stating, “If the company continues to announce AI Factory partners and clients and sign contracts, the stock price is likely to react positively even to minor momentum.”
Daol Investment & Securities also highlighted AI advertising monetization in the second half of the year. Analyst Kim Hye-young analyzed, “Current AI briefing coverage stands at the high 20% range, with a target to expand to 40% by the end of 2026,” adding, “Monetization through generative AI advertising is scheduled to begin in mid-July, and a valuation re-rating will be possible once revenue growth driven by AI is confirmed.”
Another positive factor cited is that Naver is strengthening its AI-based commerce strategy, as evidenced by its recent preparations to launch an AI shopping app.
In contrast, Kakao—which, along with Naver, hit a 52-week low (32,250 won intraday) on the 26th of last month—closed at 35,400 won, down 0.56% (200 won). However, the securities industry’s outlook on Kakao was more cautious than that on Naver.
DB Securities lowered its target price for Kakao from 69,000 won to 57,000 won. The firm cited the lack of confirmed external AI partners and a concrete revenue model, despite stable performance in its core business.
Analyst Shin Eun-jeong said, “While the cumulative user base for ‘GPT in Kakao’ is estimated at approximately 11 million, traffic metrics and connections with external partners do not yet appear to be active,” adding, “In the second half of the year, Kakao needs to create a breakthrough in AI, centered on ‘Kanana in Talk.’”
BNK Investment & Securities also lowered Kakao’s target price from 70,000 won to 61,000 won. While the recovery in earnings resilience following restructuring is positive, the firm assessed that monetization of AI and commerce must be confirmed for the market to reevaluate the stock.
HANWHA INVESTMENT & SECURITIES also lowered its target price for Kakao from 70,000 won to 62,000 won. Analyst Kim So-hye predicted, “The performance of AI services will be the most critical factor in the second half of the year,” adding, “A gradual re-rating will occur once the potential for monetizing AI agents is confirmed, even if only partially.”

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