Brokerage : Kyobo Securities
Analyst : Boyoung Choi (20190031@iprovest.com)
Investment Rating : Buy (Maintained)
Target Price : KRW 3,000,000 (Raised)
Core Momentum : Operating leverage and multi-year upward earnings revisions driven by ASP increases and product mix upgrades across AI server ultra-compact high-capacitance MLCCs and FCBGA substrates
📊 1. [Valuation & Key Financial Metrics]
- Rating & Target Price: Buy (Maintained) / Target Price KRW 3,000,000 (Raised) (Closing price KRW 1,989,000 as of July 3, 2026)
- Valuation Methodology: Target price raised reflecting 2027(E) earnings growth and global peer valuation multiples
- Key Financial Metrics & Forecast:
- Revenue (KRW): 2024 KRW 10.294 Trillion → 2025 KRW 11.314 Trillion → 2026(E) KRW 13.783 Trillion → 2027(E) KRW 17.444 Trillion → 2028(E) KRW 19.587 Trillion
- Operating Profit (KRW): 2024 KRW 735.0 Billion → 2025 KRW 913.0 Billion → 2026(E) KRW 1.707 Trillion → 2027(E) KRW 3.575 Trillion → 2028(E) KRW 4.834 Trillion
- Operating Profit Margin (OPM): 2024 7.1% → 2025 8.1% → 2026(E) 12.4% → 2027(E) 20.5% → 2028(E) 24.7%
- Net Profit (KRW): 2024 KRW 703.0 Billion → 2025 KRW 731.0 Billion → 2026(E) KRW 1.399 Trillion → 2027(E) KRW 2.871 Trillion → 2028(E) KRW 3.886 Trillion
- EPS (KRW): 2024 KRW 9,022 → 2025 KRW 9,362 → 2026(E) KRW 18,002 → 2027(E) KRW 37,042 → 2028(E) KRW 50,163
- Valuation Multiples (PER / PBR / ROE):
- 2024: PER 13.7x, PBR 1.1x, ROE 8.2%
- 2025: PER 27.2x, PBR 2.1x, ROE 7.7%
- 2026(E): PER 110.5x, PBR 14.4x, ROE 13.3%
- 2027(E): PER 53.7x, PBR 11.6x, ROE 23.1%
- 2028(E): PER 39.7x, PBR 9.1x, ROE 24.9%
- 2Q 2026 Preview (2Q26E):
- Revenue: KRW 3.4084 Trillion (+22.4% YoY, +6.2% QoQ)
- Operating Profit: KRW 411.0 Billion (+93.0% YoY, +46.5% QoQ, OPM 12.1%, beating consensus of KRW 382.0 Billion)
🚀 2. [Market Opportunities & Business Outlook]
- Component Division (MLCC):
- Supply-Demand & Pricing: Rising demand for ultra-compact, high-capacitance AI server MLCCs is driving simultaneous volume expansion, ASP hikes, and product mix enhancements in server and automotive applications.
- Capacity & Contracts: Near 100% capacity utilization and recent large-scale supply contracts (customers securing annual volumes in advance) confirm the transfer of pricing power to the supplier. Line conversions toward high-value parts are expected to diffuse price hikes across all product lines.
- Package Solutions Division (FCBGA):
- Growth Trajectory: Expected to post the steepest profit growth gradient among business units.
- Mix & Margins: Tight supply constraints driven by large-area, multi-layer AI semiconductor trends are fueling continuous ASP hikes in server FCBGAs, with rising server/network exposure stepping up divisional profitability.
- Other Segments & Mid-Term Drivers:
- Optics & Communication: Seasonal quarterly dip expected, but year-over-year recovery remains intact.
- Silicon Capacitors: Disclosed large-scale supply contracts are set to join the Substrate division as a new growth pillar.
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electro-Mechanics not merely as a cyclical component maker, but as an essential hardware platform commanding industry pricing power amid structural shortages in critical AI infrastructure components (high-capacitance MLCCs and advanced FCBGAs). This perspective looks past short-term quarterly fluctuations, placing primary emphasis on customer-driven annual volume pre-bookings, the diffusion of price increases across commodity lines caused by high-end capacity reallocation, and the structural margin step-up in large-area, multi-layer FCBGAs.
To evaluate whether this investment thesis continues to materialize, key verification checkpoints include delivering consensus-beating operating profits in 2Q26 (KRW 410 Billion+), the broad diffusion of MLCC price hikes across all product lines following high-end line conversions, the margin trajectory of the Package division driven by higher server/network FCBGA sales, and the commercial revenue timeline for silicon capacitors. Progress on these fronts can be tracked via upcoming quarterly earnings announcements, official investor relations disclosures, and periodic 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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