Texas Roadhouse earnings missed by $0.05, revenue topped estimates
Investing.com - Goldman Sachs downgraded NAVER Corp. (KS:035420) (OTC:NHNCF) from Buy to Neutral on Wednesday, while reducing its price target to KRW280,000 from KRW330,000.
The downgrade reflects Goldman Sachs’ more conservative outlook for NAVER’s search business, which is the company’s most profitable segment. While near-term growth prospects remain relatively solid, the firm identified emerging competitive threats.
Goldman Sachs specifically cited the launch of consumer generative AI services on Kakao’s messenger platform KakaoTalk as a material risk that could impact search user behavior in the near term and lead to earnings pressure in the long term.
The investment bank projects Kakao will capture 0.9% of the online search market share by 2027 and 8.8% by 2030, weighing on NAVER’s search revenue growth, which is already under pressure from Coupang’s advertising revenue growth.
Goldman Sachs reduced its target P/E multiple for NAVER’s Search Platform business to 7x from its previous 13x, noting that key global internet companies’ search business three-year growth outlook ranges from -2% to 9%, with implied multiples for search-focused ad businesses ranging from 5x to 11x P/E.
This article was generated with the support of AI and reviewed by an editor. For more information see our T&C.