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Watoscoreaco

079000 · KOSDAQ · ₩079000 · 와토스코리아

₩3,465▼ ₩60 (1.70%)End-of-day · Oct 29, 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

₩5,420

vs the current price (₩3,465)

Enterprise value
−₩11B
Equity value
₩39B
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 56% 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 ₩3,465, the model needs an operating margin of −17.9% every year (it uses −7.9%).
  • Margins ranged from −30.6% to 2.0% over the last 5 years, so this is a cyclical business. The model uses the average; the price may be set by where the cycle is now. Try the margin fade option.
  • In the projection, spending on equipment, software and working capital takes most or all of the after-tax operating profit, so free cash flow is thin. Companies that invest heavily often look like this until spending slows.

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
₩5,627
+62.4%
Base
₩5,420
+56.4%
Bull
₩5,207
+50.3%

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 (−7.9%).

Revenue growth

  • -10%

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

    Default: the last 3 years' revenue growth (-10.2% a year, annual reports), fading to 3% by year 5.

  • -6.7%

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

    Default: the last 3 years' revenue growth (-10.2% a year, annual reports), fading to 3% by year 5.

  • -3.5%

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

    Default: the last 3 years' revenue growth (-10.2% a year, annual reports), fading to 3% by year 5.

  • -0.2%

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

    Default: the last 3 years' revenue growth (-10.2% 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 (-10.2% a year, annual reports), fading to 3% by year 5.

Business

  • -7.9%

    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.

  • 6.4%

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

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

  • 4%

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

    Default: not in the statements, so a typical level.

  • 19.6%

    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.

  • 4.08%

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

    Default: Korea Treasury Bond 10-year yield on 2026-10-29.

  • 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 0.36, 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.

  • 5.58%

    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)
₩13B
Net debt (borrowings and leases − cash and deposits)
−₩50B
+ Stakes and investments
₩249M
Associates, long-term financial assets and deposits (book value)
Shares
7,200,000
Share price
₩3,465
Market cap
₩25B

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₩18B₩17B₩14B₩12B₩11B₩11B₩11B₩11B
Growth−9.4%−1.0%−19.3%−10.0%−6.7%−3.5%−0.2%3.0%
EBIT−₩90M−₩247M−₩4.3B−₩959M−₩894M−₩863M−₩861M−₩887M
EBIT margin−0.5%−1.4%−30.6%−7.9%−7.9%−7.9%−7.9%−7.9%
After-tax EBIT−₩65M−₩179M−₩3.1B−₩695M−₩648M−₩626M−₩624M−₩643M
+ Depreciation₩1.2B₩1.1B₩865M₩777M₩724M₩699M₩698M₩719M
− Capital spending———₩485M₩453M₩437M₩436M₩449M
− Working capital−₩53B−₩1.5B−₩584M−₩264M−₩159M−₩78M−₩4.3M₩64M
Free cash flow———−₩139M−₩217M−₩286M−₩358M−₩438M
Discount factor———0.9310.8670.8080.7520.700
Present value———−₩130M−₩188M−₩231M−₩270M−₩307M

Terminal value −₩14B, worth −₩10B today: 90% 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 ₩9,437 a share)Now 0.37×₩4,2310.45×₩4,8580.51×₩6,2870.67×
P/E on run-rate earnings (Q2 2026 × 4: ₩116 a share)Now 29.9×₩8577.40×₩2,09818.1×₩3,36829.1×

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%₩5,405₩5,229₩5,013₩4,742₩4,389
6.9%₩5,557₩5,412₩5,238₩5,023₩4,753
7.4%₩5,685₩5,564₩5,420₩5,247₩5,034
7.9%₩5,794₩5,691₩5,571₩5,428₩5,256
8.4%₩5,888₩5,800₩5,698₩5,578₩5,436

Now (TTM)

Market cap
₩25B
Enterprise value
−₩25B
P/E
—
P/B
0.4×
P/S
1.9×
EV/EBITDA
—
Dividend yield
11.6%

Over time (at each year end)

20252024202320222021
Price₩6,400₩5,310₩4,880₩5,290₩6,110
Market cap₩46B₩38B₩35B₩38B₩44B
P/E—18.5×13.2×7.2×30.9×
P/B0.6×0.5×0.4×0.5×0.6×
P/S3.3×2.2×2.0×2.0×2.2×
EV/EBITDA———24.4×21.2×
Dividend yield6.3%3.8%———

Versus similar companies

CompanyP/EP/BP/SEV/EBITDADividend yield
Watoscoreaco—0.4×1.9×—11.6%
Hankook Tire & Technology5.8×0.5×0.3×—4.0%
Kumho Tire3.1×0.6×0.3×—0.0%
Pum-Tech Korea19.8×2.5×2.1×—0.7%
Dongwon Systems9.7×0.7×0.4×5.7×2.8%
Nexen Tire3.6×0.3×0.2×—3.5%
PI Advanced Materials12.4×1.2×1.7×5.0×2.3%
Similar companies (median)7.7×0.6×0.4×5.4×2.6%

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

Also known as: Watoscoreaco / 와토스코리아 / 079000 / KRX:079000

Source: KRX statistical information