Brokerage : Mirae Asset Securities
Analyst : Junseo Park (park.junseo@miraeasset.com)
Investment Rating : BUY (Maintained)
Target Price : KRW 2,800,000 (Maintained)
Core Momentum : Structural earnings upward cycle driven by simultaneous increases in price (P) and volume (Q) amid AI MLCC supply tightness alongside FC-BGA margin expansion for server applications
📊 1. [Valuation & Key Financial Metrics]
- Rating & Target Price: BUY (Maintained) / Target Price KRW 2,800,000 (Maintained) (Closing price KRW 879,000 as of July 30, 2026; upside potential 218.5%)
- Key Financial Metrics & Forecast:
- Revenue (KRW): 2024 KRW 10.294 Trillion → 2025 KRW 11.314 Trillion → 2026(E) KRW 14.180 Trillion → 2027(E) KRW 17.671 Trillion → 2028(E) KRW 23.444 Trillion
- Operating Profit (KRW): 2024 KRW 735.0 Billion → 2025 KRW 913.0 Billion → 2026(E) KRW 1.904 Trillion → 2027(E) KRW 4.281 Trillion → 2028(E) KRW 7.044 Trillion
- Operating Profit Margin (OPM): 2024 7.1% → 2025 8.1% → 2026(E) 13.4% → 2027(E) 24.2% → 2028(E) 30.0%
- Net Profit (Controlling) (KRW): 2024 KRW 679.0 Billion → 2025 KRW 706.0 Billion → 2026(E) KRW 1.602 Trillion → 2027(E) KRW 3.530 Trillion → 2028(E) KRW 5.859 Trillion
- EPS (KRW): 2024 KRW 8,752 → 2025 KRW 9,099 → 2026(E) KRW 20,646 → 2027(E) KRW 45,490 → 2028(E) KRW 75,501
- Valuation Multiples (PER / PBR / ROE):
- 2024: PER 14.1x, PBR 1.1x, ROE 8.2%
- 2025: PER 28.0x, PBR 2.3x, ROE 7.7%
- 2026(E): PER 42.6x, PBR 7.0x, ROE 15.6%
- 2027(E): PER 19.3x, PBR 5.2x, ROE 27.8%
- 2028(E): PER 11.6x, PBR 4.9x, ROE 39.5%
🚀 2. [Market Opportunities & Business Outlook]
- MLCC Segment (Differentiated Shortage Dynamic vs. 2017):
- Capacity Cannibalization: AI MLCC consumes approximately three times the production capacity of standard MLCCs, causing overall available supply volume to decline as AI output increases.
- Utilization & Industry Metrics: Yageo’s BB Ratio surged to 2.2 at the end of June (up from 1.5 in Q1), and global Q3 utilization rates are reaching the 90% range, the highest level since 2018. Unlike the 2017 cycle driven solely by panic-buying price spikes, the current cycle features concurrent expansion in both price (P) and volume (Q).
- Secured LTAs: Preemptive long-term agreements (LTAs) secured with AI and memory customers reinforce the company’s pricing power and supplier-advantaged position.
- Package Solutions (FC-BGA) Segment:
- Profitability Expansion: Operating profit margin rose sharply from 10.6% in 1Q26 to 14.5% in 2Q26.
- Server Mix & Expansion: Ongoing medium-to-long term capacity expansions targeted at server and data center applications provide elevated volume and earnings visibility.
- Short-Term Earnings Outlook:
- 2Q26 Performance: Earnings surprise across both Component and Substrate divisions driven by MLCC price increases passing through and FC-BGA ASP appreciation.
- 3Q26 Forecast: Projected Operating Profit of KRW 610.3 Billion (+135% YoY, beating consensus by +20%) with corporate OPM reaching 16.0%, marking the highest profitability level since 2024.
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electro-Mechanics not as a company bounded by temporary supply-demand sentiment or valuation multiple volatility, but as an essential electronic component leader entering a robust structural earnings upgrade cycle powered by simultaneous gains in price (P) and volume (Q). This perspective emphasizes the underlying fundamental trajectory—driven by capacity cannibalization in AI MLCCs and expanding margins in server FC-BGAs—over short-term market corrections.
To evaluate whether this investment thesis continues to materialize, key verification metrics include achieving the projected 16% corporate OPM in 3Q26, sustaining supplier pricing power through AI/memory LTAs, and monitoring server/data-center FC-BGA demand, capacity expansion, and margin trajectories. Progress on these factors can be tracked via upcoming quarterly earnings releases, investor relations presentations, and official regulatory filings.
📢 Disclaimer & Source
Source: This content has been structured and newly written based on officially disclosed financial facts and data from brokerage reports.
Investment Risk Notice: This content is provided for informational and linguistic reference purposes only. Under no circumstances does it constitute financial advice or a recommendation to buy or sell any specific securities. All investment decisions and financial responsibilities rest entirely with the investor.
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