Market: KOSPI (017670)
Brokerage : Hana Securities
Analyst : Hong-sik Kim (RA: Sang-hoon Lee)
Investment Rating : BUY (Maintain)
Target Price : KRW 100,000 (Maintain)
Core Momentum : Full earnings and DPS recovery to FY2024 baseline (FY2026F DPS of KRW 3,600), enhanced effective after-tax yield via tax-exempt dividend policies, and multiple expansion driven by 5G SA evolution and August national AI project selection.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: BUY maintained, 12-Month Target Price maintained at KRW 100,000 (Based on the February 9, 2026 closing price of KRW 73,400), named Sector Top Pick
- Target Price Valuation Rationale: Target Price of KRW 100,000 corresponds to an expected dividend yield of 3.5%, supported by expanding shareholder return growth and subsequent yield band compression
- FY2026 Full-Year Forecast:
- Annual Revenue: KRW 17.816 Trillion
- Annual Operating Profit: KRW 1.879 Trillion (Expected to exceed KRW 1.8 Trillion, normalizing to FY2024 levels)
- Annual Net Profit (Controlling Interests): KRW 1.150 Trillion
- 2026E EPS: KRW 5,355 / BPS: KRW 58,393 / ROE: 9.48% / PER: 13.71x / PBR: 1.26x / EV/EBITDA: 3.73x
- Dividends & Shareholder Returns:
- Expected dividend yield of ~5% based on FY2026 estimates (Highest among domestic telcos)
- Projected FY2026 DPS: KRW 3,600 (+117% YoY in financial table; +111% YoY DPS growth cited in text from low base)
- Enhanced after-tax yield driven by new management’s push for tax-exempt capital reduction dividends
🚀 2. [Market Opportunities & Business Outlook]
- Operational Normalization & Cost Reversals:
- 4Q earnings conference call confirmed the normalization path of FY2026 earnings and dividends to FY2024 levels.
- Reduction and partial reversal of security incident expenses, alongside labor and administrative cost reductions, ensure annual consolidated operating profit of at least KRW 1.8 Trillion.
- Focus on Effective Shareholder Return Yields & Directionality:
- Shift from 2025’s focus on share buybacks/cancellations to evaluating effective shareholder return yields (after-tax dividend yield + cancelled share value).
- In a market environment where conviction surrounding share cancellations has moderated, the magnitude and direction of DPS and total shareholder return growth become paramount, elevating SKT’s relative appeal.
- Tax-exempt dividend framework strengthens SKT’s investment profile by enhancing net after-tax cash returns.
- 5G SA Evolution & National AI Catalysts:
- Positioned as a prime beneficiary as regulators accelerate 5G SA transitions to foster Physical AI industries.
- High likelihood of selection in the government’s sovereign AI project in August, creating catalysts for inflows from institutional AI-themed funds.
- Market environment mirrors early LTE/5G transition eras, favoring valuation multiple expansion and dividend yield compression.
📝 Editor’s Comment (Perspective)
The analyst argues that concerns regarding overvaluation are unfounded given SK Telecom’s ~5% dividend yield, emphasizing that cost controls and security expense reversals will restore operating profit (>KRW 1.8 Trillion) and DPS (KRW 3,600) to FY2024 levels. In an environment where market conviction around share cancellations has diminished, this perspective treats the clear direction of DPS growth and the appeal of tax-exempt payouts as solid downside support, while identifying regulatory pushes for 5G SA and selection for the national AI initiative in August as key catalysts driving valuation multiple expansion toward a 3.5% target yield (KRW 100,000 target price).
To evaluate whether this investment thesis materializes, key verification points include confirming that annual consolidated operating profit surpasses KRW 1.8 Trillion, verifying that the FY2026 KRW 3,600 DPS and tax-exempt dividend framework are officially approved, and monitoring regulatory milestones regarding 5G SA policies alongside the August national AI project selection results. These developments can be tracked via upcoming quarterly earnings releases, official IR presentations, and periodic DART statutory filings.
📢 Disclaimer & Source
Source: This content has been structured and newly written based on officially disclosed financial facts and data from brokerage reports.
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