Market: KOSPI (017670)
Brokerage : Hana Securities
Analyst : Hong-sik Kim (RA: Sang-hoon Lee)
Investment Rating : BUY (Maintain)
Target Price : KRW 140,000 (Maintain)
Core Momentum : Solid 1Q earnings turnaround and expectations for early 1Q DPS normalization, supported by potential multiple expansion led by national AI project selection and 5G SA commercialization.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: BUY maintained, 12-Month Target Price maintained at KRW 140,000 (Based on the April 27, 2026 share price of KRW 98,000), named Sector Top Pick for May and the next 12 months
- 1Q26 Earnings Forecast:
- Consolidated Operating Profit: KRW 523.1 Billion (-8% YoY, +339% QoQ, beating market consensus of KRW 506.9 Billion)
- Wireless service revenue expected to increase QoQ driven by 5G net subscriber additions
- Operating expenses well-contained due to post-restructuring labor cost savings (YoY/QoQ) and stable depreciation costs
- FY2026 Full-Year Forecast:
- Annual Revenue: KRW 17.798 Trillion
- Annual Operating Profit: KRW 1.887 Trillion (Expectations to reach ~KRW 1.9 Trillion, exceeding FY2024 levels)
- Annual Net Profit (Controlling Interests): KRW 1.157 Trillion
- 2026E EPS: KRW 5,386 / BPS: KRW 63,303 / ROE: 8.77% / PER: 18.20x / PBR: 1.55x / EV/EBITDA: 4.73x
- Dividends & Shareholder Returns:
- 1Q DPS expected to be declared between KRW 800–900 (early normalization)
- Forecasted FY2026 DPS: KRW 3,600, FY2027 DPS: KRW 3,800 (reinforcing market confidence in the annual KRW 3,600 target)
🚀 2. [Market Opportunities & Business Outlook]
- Operational Rebound & Cost Discipline:
- Recovering from 2Q25 business suspension impacts, wireless service revenue rebounds QoQ, solidifying operational recovery since 4Q25.
- Margin expansion becomes visible with reduced labor costs from structural adjustments and lower QoQ marketing expenditures.
- Early Shareholder Return Normalization:
- Early 1Q DPS recovery fuels expectations for a sharp rebound in full-year DPS.
- Positioned to deliver the most notable earnings and dividend growth among the three domestic telcos in 2026.
- Multiple Expansion & Next-Gen Network Catalysts:
- Near-term concentration of positive catalysts in May, including high likelihood of selection for national AI projects and 5G SA commercialization momentum.
- Transition into full-scale 5G SA expected to compress the dividend yield band and trigger valuation multiple expansion.
📝 Editor’s Comment (Perspective)
The analyst views SK Telecom as an operator rebuilding its operational earnings power and dividend reliability through above-consensus 1Q results and early 1Q DPS normalization, while simultaneously driving valuation multiple expansion on the back of clustered catalysts including national AI project selection and 5G SA rollout. This perspective treats industry-leading 2026 earnings and dividend growth as solid downside protection, while positioning next-generation network (5G SA) execution and national AI initiatives as primary drivers for valuation re-rating.
To evaluate whether this investment thesis materializes, key verification points include confirming that 1Q operating profit exceeds KRW 520 Billion to establish the ~KRW 1.9 Trillion annual run-rate, verifying whether 1Q DPS is declared within KRW 800–900 to support the FY2026 KRW 3,600 dividend expectation, and tracking tangible progress in the national AI project selection alongside 5G SA commercialization policies during May. These developments can be verified via upcoming quarterly earnings announcements, official IR materials, and periodic DART statutory filings.
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