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Monday, August 11th, 2014
SEOUL, KOREA - Home shopping stocks, which have been battered during the first half of this year, are rising again. It remains to be seen whether home shopping shares can keep their momentum separate from the overall retail shares that are slowly losing steam.
For example, CJ O Shopping saw its shares close at 388,900 won, up 0.46 percent on August 8. This is up 15.8 percent in one-and-a-half months since the nadir of 335,700 won in June. GS Home Shopping has also gained 28.5 percent to 281,200 won from 218,500 won in three months.
Since early this year, home shopping shares have been down as they posted disappointing financial performances. The second-quarter operating profit for CJ O Shopping was 39.0 billion won, almost at the same level as the same period last year. That for GS Home Shopping was 36.0 billion won, down 1.6 percent from a year ago.
Given the government's stimulus package is expected to encourage consumer spending in the second half, with the competition in the mobile marketing area getting less fierce, however, the outlook for home shopping stocks is steadily improving.
The fact that major home shopping operators are expected to increase their dividend payouts is also a factor to support the relative strength of the stocks. The dividend ratios for CJ O Shopping and GS Home Shopping are 11.1 percent and 16.8 percent, respectively, which are much higher than those for Hyundai Department Store (4.4%) and E-Mart (8.8%).
