By Kwanwoo Jun
Kakaopay Corp. shares rallied for a second session on Thursday, and helped to boost its parents' stock, amid hopes for improved earnings in the second half.
Shares in the South Korean mobile-payments company jumped 14% to 73,000 won ($55.8) in early trading Thursday--the sharpest daily percentage gain since November in 2021--following a 5.4% gain in the prior session after it reported its second-quarter earnings.
Parent Kakao Corp., which owns a 47.83% stake in Kakaopay, rose 6.7% to KRW81,100.
The rally reflects the market's upbeat outlook on the fintech company's earnings, even though it was in the red in the quarter ended in June largely because of increased operating costs and new investments.
Daiwa Capital Wednesday upgraded its rating on Kakaopay to buy from outperform, noting that the company's management maintained its full-year revenue growth target at 40%-60% despite the firm's somewhat subdued second-quarter results.
Seoul-based SK Securities analyst K.S. Choi in a research note said that he expects Kakaopay to turn a profit in the third quarter and post solid top-line growth in 2023.
Kakaopay is set to gain from expanding its online settlement services to offline ones as well as its investments in brokerage and insurance services, Mr. Choi added.
SK Securities cut the stock's target by 34% to KRW76,000 but upgraded its rating to buy from neutral.
Write to Kwanwoo Jun at email@example.com
(END) Dow Jones Newswires