Korean Securities Firms Issue 422 Downward Stock Target Reports in July

Korean securities firms issued 422 downward target price reports this month, marking the highest count since May of last year and the first time downward revisions exceeded upward reports (273) in 2025, according to FnGuide data released on July 22. Analysts are cutting target prices to narrow the widening gap between projections and actual stock prices following sharp market declines. The surge in downward revisions comes as most sectors excluding semiconductors have already undergone bear market-level corrections since before July, with analysts adjusting targets during the earnings season.

Securities Firms Cut Target Prices by Half for Major Stocks

Sangsangin Securities cut its target price for Mirae Asset Securities from 88,000 won to 43,000 won on July 22, following a 47% stock price decline since the firm last issued a target in May. DS Investment Securities reduced Studio Dragon's target from 60,000 won to 30,000 won on July 21, after the stock fell 54% since the January target issuance. The sharp reductions reflect analysts' efforts to align projections with actual market prices amid severe stock corrections.

Analysts Adjust Valuation Methodologies Amid Market Weakness

Securities firms are lowering target multiples and changing valuation formulas to recalculate target prices. Sangsangin Securities reduced its target price-to-book ratio (PBR) for Mirae Asset Securities from 3.28 to 1.57. DS Investment Securities switched its valuation method for Studio Dragon from earnings before interest, taxes, depreciation and amortization (EBITDA) to price-to-earnings ratio (PER), applying a 20x multiple. DS stated it changed the methodology "considering comparability convenience and monetization expansion strategy."

Retail Investors Criticize Reactive Target Price Adjustments

Individual investors are expressing frustration over target price changes that follow market movements. Retail traders criticize the practice as overly reactive, noting that analysts raise targets belatedly when stocks rise and lower them when stocks fall. The complaints highlight concerns about the utility of analyst projections that track rather than anticipate price movements.

FAQ

How many downward target price reports did Korean securities firms issue this month?

Korean securities firms issued 422 downward target price reports this month, compared to 273 upward reports, according to FnGuide data released on July 22. This is the first time in 2025 that downward revisions exceeded upward revisions.

What specific target price cuts did analysts make in July?

Sangsangin Securities cut Mirae Asset Securities' target from 88,000 won to 43,000 won on July 22, and DS Investment Securities reduced Studio Dragon's target from 60,000 won to 30,000 won on July 21. These cuts followed stock price declines of 47% and 54% respectively since the previous target issuances.