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Stock Markets February 9, 2026

Bernstein Identifies Three Korean Internet Leaders, Cites Content, Ads and AI as Growth Drivers

Hybe, Kakao and Naver earn Outperform ratings as analysts highlight IP monetization, frequency-based advertising and e-commerce-AI synergies

By Leila Farooq
Bernstein Identifies Three Korean Internet Leaders, Cites Content, Ads and AI as Growth Drivers

Bernstein has singled out three South Korean internet companies it views as best positioned for growth: Hybe, Kakao and Naver. Each received an Outperform rating and distinct price targets, with Hybe marked for IP-led upside tied to BTS and new properties, Kakao noted for its frequency-driven ad business, and Naver credited for regaining e-commerce share supported by an AI platform layer.

Key Points

  • Hybe (352820.KS): Outperform, price target KRW 500,000; positioned for IP monetization with expected BTS-related revenue increase in 2027 and potential growth from new IP Cortis.
  • Kakao (035720.KS): Outperform, price target KRW 80,000; identified as a frequency-driven advertising leader with products comparable to WeChat Channels expected to boost digital ad revenue.
  • Naver (035420.KS): Outperform, price target KRW 340,000; regaining e-commerce share and leveraging a robust AI platform layer to support an e-commerce-focused AI ecosystem.

Investment research firm Bernstein has named three South Korean internet companies as its top picks in the domestic internet sector, assigning Outperform ratings and explicit price targets to each. The recommendations emphasize differing sources of upside - entertainment intellectual property, high-frequency advertising, and an e-commerce ecosystem reinforced by artificial intelligence.

Hybe (352820.KS) sits atop Bernstein's list with an Outperform rating and a price target of KRW 500,000. Analysts emphasize Hybe's role as an incubator of K-pop intellectual property, highlighting the potential for increased revenue tied to BTS beginning in 2027. Bernstein also points to Hybe's new IP, Cortis, which the firm expects to evolve into the company's second-largest intellectual property after BTS.

Kakao (035720.KS) is Bernstein's second choice, receiving an Outperform rating and a KRW 80,000 price target. The firm characterizes Kakao as a 'frequency winner' in Korea, citing a business model likened to Tencent's WeChat. Bernstein highlights Kakao's frequency-based advertising products - compared by the firm to WeChat Channels - as a key driver expected to propel digital advertising revenue momentum.

Naver (035420.KS) completes the top three with an Outperform rating and a KRW 340,000 price target. Bernstein notes that Naver is successfully reclaiming e-commerce market share. The firm underscores Naver's strong AI platform layer and says the company is positioned to benefit from an e-commerce-based AI ecosystem, following a template similar to Alibaba's model in China.

Each recommendation from Bernstein pairs a sector-specific thesis with a quantified price target, reflecting differentiated routes to revenue expansion across content, advertising and commerce. The research flags timing and product development milestones - including anticipated BTS revenue increases and the development of new intellectual property - as material to the investment case for at least one of the companies.

Market sectors impacted - internet content and entertainment, digital advertising, e-commerce and AI platform services.

Risks

  • Timing and magnitude of BTS-related revenue increases in 2027 - outcomes may differ from expectations and would directly affect Hybe's revenue trajectory - impacts entertainment and content revenues.
  • Execution risk for new intellectual property such as Cortis achieving the expected scale to become Hybe's second-largest IP - affects content monetization potential.
  • Adoption and monetization of frequency-based advertising products at Kakao and the execution of Naver's AI-enabled e-commerce ecosystem may not translate into the projected digital advertising or commerce revenue gains - impacts advertising and e-commerce sectors.

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