[E-Daily Reporter Park Sun-Yeop ] Although the media industry continues to struggle, analysts in the securities sector suggest that the bottom is nearing. With the TV advertising market expected to post another sharp decline, analysts believe that if the rate of decline in advertising spending slows to a low single-digit percentage in the second half of the year, the industry may have reached its trough. However, some analysts remain cautious, arguing that expectations of an industry recovery alone are insufficient to provide the momentum needed for a rebound in the stock prices of major media and content companies.
Lee Ki-hoon, an analyst at Hana Securities, stated in a report on the 8th, “TV advertising is expected to post another decline of around 20%, marking the 16th consecutive quarter of decline,” but added, “It is necessary to assess the potential for tvN and SEOULBROADCASTINGSYSTEM to benefit indirectly from issues surrounding JTBC.” He analyzed, “If the second half of the year shows only low single-digit negative growth, the bottom of the industry cycle will be confirmed.”

Hana Securities maintained its “Overweight” investment rating on the media sector but lowered the target prices for all major stocks. It set the target price for CJ ENM CO., Ltd.(035760) at 53,000 won, down 24% from the previous level; for Studio Dragon Corporation(253450)at 37,000 won, down 23%; and for SEOULBROADCASTINGSYSTEM(034120)at 18,000 won, down 10%.
CJ ENM CO., Ltd.’s second-quarter revenue and operating profit are projected to reach 1.3 trillion won and 31.3 billion won, respectively, representing year-over-year increases of 2% and 9%. These figures are in line with market consensus. The Media Platform division is expected to return to profitability, driven by the growth of TVING during the KBO season, despite sluggish TV advertising. TVING is expected to maintain solid performance as subscriptions, advertising, and overseas sales all show strong momentum.
However, the Film & Drama division is expected to post an operating loss of around 11 billion won due to a lack of film releases and a scheduling gap for “Fifth Season.” The music division was also projected to underperform expectations, despite KCON Japan and the comebacks of major artists, due to the burden of production costs for new groups. The analyst noted, “CJ ENM CO., Ltd. faces headwinds from the lack of clarity regarding its stake in Netmarble Corporation—which accounts for more than half of its market capitalization—and the issue of the TVING-WAVVE merger.”
Studio Dragon Corporation is expected to return to profitability in the second quarter with revenue of 142.3 billion won and operating profit of 14.2 billion won. The increase in the number of broadcast episodes—from 36 in the same period last year to 77—is expected to drive this improvement in performance. Titles such as “Secret Audit,” “Yumi’s Cells 3,” and “The Legend of the Cook” were factored into the forecast, and strong overseas sales of “Secret Audit” are also expected to have a positive impact on earnings.
However, in terms of stock price, analysts assess that the market capitalization of its parent company, CJ ENM CO., Ltd., is likely to act as a ceiling. The analyst explained, “Studio Dragon Corporation is significantly undervalued, with an expected price-to-earnings ratio (PER) of around 15 times for 2027,” but added, “It lacks its own momentum to surpass CJ ENM CO., Ltd.’s enterprise value, making it difficult to rise on its own.”
SEOULBROADCASTINGSYSTEM is projected to fall short of consensus estimates in the second quarter, with revenue of 243.7 billion won and an operating loss of 800 million won. On a standalone basis, TV advertising held up well in April and May but is estimated to have declined by 16% year-over-year in June due to the World Cup. In addition, election-related costs of approximately 2.5 billion won were factored in, and the impact of cost reductions in content production was not significant, according to the analysis.
However, the possibility of a recovery in the second half of the year was mentioned. The explanation noted that advertising trends have been recovering rapidly since July, and that benefits are expected from the easing of advertising regulations—including the expansion of the daily advertising quota system for terrestrial broadcasters in the fourth quarter—as well as spillover benefits from the JTBC controversy. The success of the drama “Director Kim” was also cited as a positive factor. The analyst stated, “Although we have lowered our target price for SEOULBROADCASTINGSYSTEM in line with the downward revision of its earnings, we believe the sector has passed its trough.”