Market: KOSPI (017670)
Brokerage : Eugene Investment & Securities
Analyst : Chan-young Lee
Investment Rating : HOLD (Maintain)
Target Price : KRW 94,000 (Upgraded)
Core Momentum : While core earnings, dividends, and Anthropic’s equity valuation have normalized, further upside is constrained by priced-in equity gains and limited near-term profit contributions from AI.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: HOLD maintained, Target Price raised to KRW 94,000 (from KRW 85,000; based on the closing price of KRW 93,500 on May 8, 2026)
- Valuation Rationale: Target price raised to reflect a media-reported Anthropic valuation of $900 Billion and an estimated 0.2% diluted stake (~KRW 2.6 Trillion), though the analyst notes this is already largely priced into current share levels
- 1Q26 Results Summary:
- Consolidated Revenue: KRW 4.392 Trillion (-1.4% YoY)
- Consolidated Operating Profit: KRW 537.6 Billion (-5.3% YoY, slightly beating market consensus)
- SK Broadband Operating Profit: KRW 116.6 Billion (Record quarterly high, accounting for 23% of consolidated operating profit)
- FY2026 Full-Year Forecast:
- Annual Revenue: KRW 17.548 Trillion
- Annual Operating Profit: KRW 1.908 Trillion (+77.8% YoY)
- Annual Net Profit: KRW 1.229 Trillion
- 2026E EPS: KRW 5,824 / BPS: KRW 58,411 / ROE: 9.7% / PER: 16.1x / PBR: 1.6x / EV/EBITDA: 5.2x
- Dividends & Shareholder Returns:
- Quarterly dividend resumed with 1Q26 DPS of KRW 830
- Capital reduction dividend (tax-exempt) scheduled starting from the 4Q26 year-end payout
- 2026E dividend yield of 3.8% (providing limited relative appeal compared to the 10-year Treasury yield of 3.9%)
🚀 2. [Market Opportunities & Business Outlook]
- Core Operational Recovery:
- Gained approximately 210,000 net MNO subscribers in 1Q26, benefiting from competitor penalty waivers and mitigating the impact of past security disruptions.
- FY2026 operating profit forecast at KRW 1.908 Trillion, signaling a recovery back to pre-incident profitability levels.
- Subsidiary & Infrastructure Drivers:
- High-margin data center growth and labor cost savings from voluntary retirements propelled SK Broadband to record quarterly operating profit.
- Growth momentum is expected to continue with data center capacity additions and commercial subsea cable projects.
- AI Contribution & Valuation Headwinds:
- Assuming data centers reach KRW 1.0 Trillion in revenue and KRW 150.0 Billion in operating profit by 2030, they would still represent only 6% and 8% of consolidated totals, respectively.
- Re-rating beyond traditional defensive dividend boundaries lacks sufficient justification until AI operations contribute meaningful earnings to the bottom line.
📝 Editor’s Comment (Perspective)
The analyst views SK Telecom as an operator that has successfully restored its pre-incident KRW 1.9 Trillion operating profit run-rate and quarterly dividend through core subscriber recovery and SK Broadband’s data center execution, but notes that upside is largely capped because Anthropic’s equity value is already reflected in the stock. This neutral perspective highlights that while operational stability has returned, a ~3.8% dividend yield offers limited yield spread over 10-year treasuries and AI businesses have yet to achieve the earnings scale required for multiple expansion.
To evaluate whether this investment thesis evolves, key verification points include confirming that core operations deliver the targeted ~KRW 1.91 Trillion annual operating profit alongside the 4Q26 tax-exempt dividend implementation, while tracking potential Anthropic valuation upgrade events and monitoring the tangible pace of revenue and profit contributions from new data centers and subsea cable projects. These developments can be verified via upcoming quarterly earnings announcements, official IR materials, and periodic DART statutory filings.
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