K-pop is a songs phenomenon that stretches considerably further than South Korea — and for investors seeking to income in, there are just a couple major companies at the rear of its extra than 300 teams. Bokyung Suh, director and senior exploration analyst at Bernstein, is bullish on just one of them in particular. His choose is K-pop agency Hybe, which he’s provided an outperform score and a target rate of 350,000 South Korean received ($258) — or all around 44% upside from Tuesday’s shut. Hybe’s roster of artists consists of BTS — one of the greatest South Korean boy bands. Hybe, which is listed on the Kospi , is one of K-pop’s most prominnt gamers, along with Kosdaq-mentioned SM Entertainment, JYP Leisure and YG Amusement. “I believe in the sector for the long-phrase progress and the macro trend,” Suh instructed CNBC’s ” Street Symptoms ” on Monday. Though Bernstein only addresses Hybe, Suh claimed, “as prolonged as the world-wide gamers these types of as Disney, Netflix and Spotify will spend additional and additional income for K-contents, the greatest beneficiaries will be the adjacent K-pop players and on the worth chain as effectively.” He estimates that there are about 500 million K-pop supporters in the world, and he expects this figure to increase. Suh highlighted that Netflix declared in April that it would make investments $2.5 billion in South Korean media over the next 4 many years. He also pointed to Netflix CEO Ted Sarandos’ visit to South Korea in June , the place Sarandos discovered that “K-material” viewership rose sixfold in the final 4 yrs by yourself, and that far more than 90% of watchers of Korean romance exhibits on Netflix are from exterior the nation. Why the Hybe hype Suh has a unique reason for selecting Hybe: its mental assets “diversification.” “We know that enjoyment is typically regarded as as a lottery business, as we simply cannot simply forecast the long term and general performance right before launching the IP, these kinds of as Squid Activity or Game of Thrones. So this is the explanation why the world top business leisure gamers organizations attempt to diversify their IP portfolio to run their business enterprise far more sustainably.” In accordance to Suh, BTS will make up about 32.8% of Hybe’s profits, followed by boy band Seventeen (30%), which is managed by Hybe subsidiary Pledis Enjoyment. Rookie boy band Tomorrow X Alongside one another tends to make up 15% of earnings, whilst lady group NewJeans — which debuted in 2022 underneath subsidiary ADOR — accounts for about 5-10%. Most recently, Hybe renewed its contracts with BTS for an unspecified sum of time, a progress that will simplicity concerns about Hybe’s “lengthy expression progress story,” Suh wrote in a Sept. 20 take note. BTS’ contract was thanks to expire in 2024. “This, we believe that, will make remarkably favourable sentiment since it proves the company’s strong expertise administration capability and the clear and agile IR practice.” In contrast, shares recently tumbled on media stories that 3 of four members of girl team Blackpink would not renew their contracts with YG Enjoyment. As BTS users have by now begun or will begin South Korea’s two-12 months obligatory armed service service, Suh said, the band’s reunion — and its impression on Hybe’s balance sheet — will choose location all-around early 2026.