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SM Entertainment

041510 · KOSDAQ · ₩041510 · 에스엠

₩80,300▲ ₩800 (1.01%)End-of-day · Oct 28, 2026 · End-of-day prices.
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Valuation model · Discounted cash flow (DCF)

We use a 5-year discounted cash flow: the value of the cash the business is expected to produce, in today's money.

Fair value per share

₩114,663

vs the current price (₩80,300)

Enterprise value
₩2.5T
Equity value
₩2.6T
WACC
7.4%

Model estimate based on the assumptions shown. Not a price target and not a buy or sell signal. This is not financial advice.

Why the model and the price differ

The model is 43% away from today's price. A gap this size usually means the market expects something the past figures don't show yet, or the model leaves something out. What we can see:

  • To match today's price of ₩80,300, the model needs an operating margin of 8.3% every year (it uses 11.9%).
  • Or revenue growth −8.4 points a year higher than assumed in each of the 5 years.
  • Today's P/E is 14.0× against a typical 13.0× over the last 10 years.

Treat the model as a starting point: change the assumptions to the story you believe, and compare with the multiples check below.

Bear / Base / Bull

Bear
₩71,938
−10.4%
Base
₩114,663
+42.8%
Bull
₩185,353
+130.8%

Bear: revenue growth 3 points lower every year, EBIT margin 2 points lower, WACC 1 point higher. Bull: the opposite.

Assumptions

Sign in to change the assumptions and see the results update. Sign in

Cycle options

Margin path

Every year uses the cycle-average margin (11.9%).

Revenue growth

  • 11.4%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (11.4% a year, annual reports), fading to 3% by year 5.

  • 9.3%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (11.4% a year, annual reports), fading to 3% by year 5.

  • 7.2%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (11.4% a year, annual reports), fading to 3% by year 5.

  • 5.1%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (11.4% a year, annual reports), fading to 3% by year 5.

  • 3%

    How much sales grow that year, compared with the year before.

    Default: the last 3 years' revenue growth (11.4% a year, annual reports), fading to 3% by year 5.

Business

  • 11.9%

    Operating profit as a share of revenue.

    Default: through-the-cycle average of the last 12 months and the last 5 annual reports' operating margins.

  • 27.5%

    Share of operating profit paid as corporate tax.

    Default: Korea's top corporate tax rate (25%) plus 10% local income tax.

  • 3.8%

    The non-cash cost of wearing out equipment, added back to cash flow (% of revenue).

    Default: not in the statements, so 80% of capital spending (most spending replaces equipment that wears out).

  • 4.7%

    Money spent on factories, equipment, software and other long-term assets (% of revenue).

    Default: average of the last 3 annual reports (cash flow statements; equipment and intangibles).

  • -3.9%

    Stock and unpaid customer bills, less unpaid supplier bills, as a % of revenue. Each year's extra revenue ties up this much more cash.

    Default: working capital (current assets less cash and deposits, minus current liabilities other than borrowings) as a share of revenue, averaged over the last 3 years.

Discount rate

  • 2%

    How fast cash flows keep growing every year after year 5.

    Default: about Korea's long-run inflation plus real growth.

  • 4.11%

    Yield on Korea's 10-year government bond: the return with almost no risk.

    Default: Korea Treasury Bond 10-year yield on 2026-10-28.

  • 0.6

    How much the share moves when the market moves: 1 means just like the market.

    Default: 105 weeks of weekly returns against KOSPI (official index); raw beta 0.01, adjusted toward 1 and kept between 0.6 and 2.0.

  • 5.5%

    The extra return investors want for owning shares instead of bonds.

    Default: a typical premium for Korean shares.

  • 5.61%

    The interest rate the company would pay to borrow.

    Default: the 10-year yield plus a 1.5% credit spread.

Starting point

Revenue (TTM to H1 2026)
₩1.3T
Net debt (borrowings and leases − cash and deposits)
−₩449B
+ Stakes and investments
₩36B
Associates, long-term financial assets and deposits (book value)
− Minority interests
₩354B
Shares
22,894,690
Share price
₩80,300
Market cap
₩1.8T

TTM = trailing 12 months: the last four reported quarters added together. "TTM to H1 2026" is the 12 months up to the latest quarterly or half-year report (H1 = to the end of June). Year 1 grows from there.

Past years and projection

Grey columns are reported results from the annual reports (after-tax EBIT at the model's tax rate), so you can check the growth and margin assumptions against the past. Years 1–5 are the model.

FY2023FY2024FY2025Year 1Year 2Year 3Year 4Year 5
Revenue₩961B₩990B₩1.2T₩1.4T₩1.5T₩1.7T₩1.7T₩1.8T
Growth13.0%3.0%18.7%11.4%9.3%7.2%5.1%3.0%
EBIT₩113B₩87B₩183B₩168B₩184B₩197B₩207B₩213B
EBIT margin11.8%8.8%15.6%11.9%11.9%11.9%11.9%11.9%
After-tax EBIT₩82B₩63B₩133B₩122B₩133B₩143B₩150B₩155B
+ Depreciation———₩54B₩59B₩63B₩66B₩68B
− Capital spending₩53B₩51B₩41B₩66B₩73B₩78B₩82B₩84B
− Working capital₩18B−₩201B₩21B−₩5.6B−₩5.1B−₩4.3B−₩3.3B−₩2B
Free cash flow———₩115B₩125B₩132B₩138B₩141B
Discount factor———0.9310.8670.8070.7510.700
Present value———₩107B₩108B₩107B₩104B₩98B

Terminal value ₩2.8T, worth ₩2T today: 79% of enterprise value. It assumes spending settles at 110% of depreciation once growth slows to the terminal rate.

Cross-check: what the market has paid before

For cyclical businesses, analysts check a DCF against the multiples the stock has traded at through past cycles. Price / book is the usual anchor for them: P/E looks highest at the bottom of a cycle, when earnings are smallest, and lowest at the top. The price each band would give today:

LowTypicalHigh
Price / book (book value ₩45,070 a share)Now 1.78×₩91,3912.03×₩122,5042.72×₩166,5473.70×
Price / earnings (last 12 months: ₩5,750 a share)Now 14.0×₩49,2688.57×₩74,80013.0×₩178,03531.0×
P/E on run-rate earnings (Q2 2026 × 4: ₩5,146 a share)Now 15.6×₩44,0898.57×₩66,93713.0×₩159,32131.0×

Low, typical and high are the 10th percentile, middle and 90th percentile of month-end multiples since 2021, each against the latest report out by then, per share at today's share count; loss years and P/E above 100 are left out. Run-rate earnings are one quarter × 4, not a forecast. Model estimate based on the assumptions shown. Not a price target and not a buy or sell signal.

Sensitivity

Fair value per share as two inputs change; the middle is the current case.

WACC ↓ · Terminal growth →1.0%1.5%2.0%2.5%3.0%
6.4%₩118,125₩127,895₩139,884₩154,944₩174,427
6.9%₩108,394₩116,376₩125,987₩137,780₩152,594
7.4%₩100,185₩106,811₩114,663₩124,118₩135,720
7.9%₩93,169₩98,742₩105,260₩112,986₩122,288
8.4%₩87,103₩91,845₩97,329₩103,742₩111,344

Now (TTM)

Market cap
₩1.8T
Enterprise value
₩1.3T
P/E
14.0×
P/B
1.8×
P/S
1.4×
EV/EBITDA
—
Dividend yield
2.0%

Over time (at each year end)

20252024202320222021
Price₩135,000₩75,600₩92,100₩76,700₩74,200
Market cap₩3.1T₩1.7T₩2.1T₩1.8T₩1.7T
P/E8.9×94.5×24.2×22.0×12.7×
P/B3.1×2.6×2.9×2.5×2.8×
P/S2.6×1.7×2.2×2.1×2.4×
EV/EBITDA—————
Dividend yield1.2%0.5%———

Versus similar companies

CompanyP/EP/BP/SEV/EBITDADividend yield
SM Entertainment14.0×1.8×1.4×—2.0%
HYBE—2.1×2.0×—0.3%
JYP Entertainment13.1×2.2×1.7×7.3×2.2%
CJ CGV—1.1×0.4×—0.0%
YG Entertainment22.0×1.4×1.2×—0.8%
Studio Dragon21.9×0.9×1.2×—0.0%
The Pinkfong4.3×0.8×2.0×2.3×0.0%
Similar companies (median)17.5×1.3×1.5×4.8×0.1%

Calculated from end-of-day prices and filed financial statements. Not a recommendation. This is not financial advice.

Also known as: SM Entertainment / 에스엠 / 041510 / KRX:041510

Source: KRX statistical information