Amid a prolonged strong dollar and a low-liquidity market environment, it is time to calmly assess the fundamentals of KOSDAQ entertainment stocks that stand out for their earnings visibility.
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Core Summary
With the USD/KRW exchange rate entering the 1,500 KRW range, a shift in supply and demand toward export-driven entertainment stocks within the KOSDAQ 150 is emerging.
JYP Ent. (035900) recorded an earnings surprise in the first quarter, simultaneously highlighting its multiple defensive capabilities and EV/EBITDA attractiveness.
Unlike the strong NASDAQ, the KOSDAQ continues to experience a low-liquidity gap volatility market, increasing the likelihood that institutional program buying will be concentrated on stocks with high earnings visibility.
In particular, the balanced growth strategy of both senior and rookie artists is yielding results in Western markets, effectively absorbing the benefits of the rising exchange rate.
Current Situation Summary
As of May 20, 2026, the KOSPI closed at 7,208.95 and the KOSDAQ at 1,056.07, showing sector-by-sector differentiation in the domestic stock market.
As the USD/KRW exchange rate soared to 1,506.80 KRW, a trend of supply and demand shifting toward large-cap KOSDAQ stocks that can benefit from the exchange rate has been detected.
In particular, despite the continued upward trend of the NASDAQ (25,870.71), KOSDAQ growth stocks (biotech, secondary batteries, etc.) are seeing profit-taking due to high-interest-rate burdens and pressure from retail margin balances.
Conversely, amid the divergent flows between the KOSDAQ 150 and KOSDAQ Small indices, earnings-based entertainment stocks are suggested as potential safe havens for foreign program trading.
According to Daily Stock's proprietary Fear & Greed Index, the KOSPI index is currently Neutral (50.3), showing a dampened investor sentiment compared to Greed (64.7) one week ago, Greed (61.5) one month ago, and Neutral (57.3) three months ago.
The NASDAQ Fear & Greed Index is also currently at Greed (60.3), showing a somewhat calmed momentum compared to Greed (64) one week ago, Greed (70) one month ago, and Greed (69.2) three months ago.
Financial Analysis
JYP Ent.'s consolidated revenue for the first quarter of 2026 reached 186 billion KRW, with an operating profit of 33.4 billion KRW, achieving an earnings surprise with increases of 32% and 70% year-over-year, respectively.
The growth in MD (merchandise) sales driven by TWICE's North American activities and the sales of Stray Kids' older albums in Western markets served as the key drivers of the strong performance.
In addition to senior artists, the global multi-label system appears to be settling in, as rookie lineup NMIXX sold out all 11 of its North American and European tour dates.
This trend of Total Addressable Market (TAM) expansion in the West could lead to an overall increase in selling prices, positively impacting margin improvement.
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Valuation
With price corrections preceding across the entertainment sector, analysis suggests that JYP Ent. has approached the lower end of its historical EV/EBITDA and PSR bands.
The current stock price is hovering around 62,100 KRW (unconfirmed intraday price, based on the latest checked value), representing a phase where multiple attractiveness based on the projected 2026 earnings is gradually being highlighted.
Although the valuation premium granted during past high-growth periods has somewhat shrunk, considering the expansion of global fandoms, the current valuation level may offer medium- to long-term entry opportunities.
Notably, compared to peers and leading stocks within the KOSDAQ 150, maintaining a stable operating profit margin can act as a key factor in securing downside rigidity.
| Top 3 Entertainment | Latest Price May 2026 (Unconfirmed) | Vs. 52-Week High | Key 2026 Momentum |
|---|---|---|---|
| **JYP Ent. (035900)** | Around 62,100 KRW | Approx. -29% | Western expansion of rookie IP, advancement of MD strategies |
| **SM (041510)** | Around 92,700 KRW | Approx. -40% | Streamlining existing pipeline and enhancing profitability |
| **YG Ent. (122870)** | Around 53,900 KRW | Approx. -51% | Full-scale activities of new groups and boosting global awareness |
Expert & Institutional Analysis
Brokerages view JYP Ent.'s fundamental shift toward a global structure positively, while major institutional investors are also showing a trend of net buying small- to mid-cap tech stocks within the entertainment sector.
Major institutions such as NH Investment & Securities and iM Securities maintain target prices in the 90,000 to 94,000 KRW range, focusing on structural growth through the advancement of global MD strategies.
Experts diagnose that in a situation where customer deposits are limited, the supply and demand of KOSDAQ active ETFs are highly likely to concentrate on large agencies with verified earnings.
However, in the long term, reducing dependence on senior groups and proving the growth potential of new IPs with numbers could serve as a key metric determining the sustainability of institutional buying.
Risk Factors
The prolongation of global inflation and the high-interest-rate environment pose a potential risk of reducing fans' disposable incomes, leading to a slowdown in physical album sales.
Additionally, in the low-liquidity environment across the KOSDAQ, if retail margin call liquidations surge simultaneously, the possibility of index-linked gap declines occurring regardless of an individual company's strong performance cannot be ruled out.
The effect of the USD/KRW exchange rate (1,506.80 KRW), which has been a major driver for foreign supply and demand, also leaves room for downward revisions to earnings estimates if the exchange rate drops sharply due to future macroeconomic policy shifts.
Caution is advised, as short-term profit-taking could pour in if specific flagship artists' second-half tour schedules are delayed or if box-office success falls short of expectations.
Investment Perspective Summary
In the current phase of KOSDAQ at 1056, JYP Ent. is in a position to aim for a valuation re-rating equipped with two weapons: defense against high exchange rates and fandom expansion in Western markets.
To avoid the burden that NASDAQ tech stock volatility places on domestic biotech or AI themes, there is a growing perspective considering the inclusion of entertainment stocks, which hold characteristics of consumer staples within a portfolio.
However, as supply and demand instability persists across the overall market, a strategy of partial accumulation while confirming the actual tour growth metrics of rookie IPs may be more advantageous than aggressive buying.
The point at which the concurrent net buying trend of foreign and institutional programs remains solid will likely be the true signal of a stock price reversal.
Daily Stock Q&A
Q1. What is the short-term merit of entertainment stocks compared to secondary batteries and biotech in the KOSDAQ market?
While the prolonged high-interest rates have increased the valuation burden on growth stocks that pull in future earnings, large entertainment agencies possess robust cash flows currently being generated and high operating profit margins that can serve to defend against stock price declines.
Q2. What is the specific impact of the USD/KRW exchange rate breaking 1,500 KRW on JYP Ent.'s earnings?
When revenues from streaming, albums, concerts, and MD in North America and other global markets are settled in dollars, an operating leverage effect can be expected, where KRW-converted earnings naturally increase in proportion to the rise in the exchange rate.
Q3. Which pipelines should be noted besides Stray Kids and TWICE?
The results of the first global world tour for NMIXX, entering its 5th year since debut, along with the rising North American awareness of new IPs like the localized global girl group VCHA, are considered key variables for future valuation expansion.
Q4. How attractive are JYP Ent.'s shareholder returns or share buybacks?
While the entertainment sector leans more toward growth stocks than traditional dividend stocks, aligned with the recent corporate value-up policies in the domestic stock market, expectations for share buybacks and cancellations could gradually emerge, centered on agencies with abundant cash reserves.
Q5. What are the most critical risk indicators to check when investing?
It is advisable to periodically monitor the trends in foreign program trading, KOSDAQ margin clearance pressure, and initial album sales (first-week sales) metrics, which gauge the density of core fandoms in global regions such as the West.
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