Brokerage : IBK Securities (Analyst: Woonho Kim)
Investment Rating : Buy (Maintained)
Target Price : KRW 460,000 (Upgraded)
Core Momentum : Significant upward revisions in earnings forecasts driven by steep DRAM and NAND ASP appreciation and the volume ramp-up of HBM4 expected from 3Q26
📊 1. [Valuation & Key Financial Metrics]
- Rating & Target Price: Buy maintained, Target Price upgraded by 31.4% to KRW 460,000 (from KRW 350,000; applied 4.0x PBR to 2026E BPS of KRW 114,449; current price KRW 296,000 as of 2026.07.07)
- Earnings Forecast Summary:
- 2024A: Revenue KRW 300.9T, Operating Profit KRW 32.7T, Controlling Net Profit KRW 33.6T
- 2025A: Revenue KRW 333.6T, Operating Profit KRW 43.6T, Controlling Net Profit KRW 44.3T
- 2026F: Revenue KRW 763.9T, Operating Profit KRW 419.7T, Controlling Net Profit KRW 341.4T
- 2027F: Revenue KRW 999.4T, Operating Profit KRW 648.0T, Controlling Net Profit KRW 532.6T
- 2028F: Revenue KRW 1,195.9T, Operating Profit KRW 788.5T, Controlling Net Profit KRW 658.7T
- Valuation Multiples & Financial Indicators:
- EPS: 2025A KRW 6,564 → 2026F KRW 51,184 (upgraded from KRW 44,001) → 2027F KRW 80,103 (upgraded from KRW 62,489) → 2028F KRW 99,073
- PER: 2025A 18.3x → 2026F 5.8x → 2027F 3.7x → 2028F 3.0x
- PBR: 2025A 1.9x → 2026F 2.6x → 2027F 1.6x → 2028F 1.0x
- ROE: 2025A 10.8% → 2026F 57.6% → 2027F 52.7% → 2028F 41.9%
- EV/EBITDA: 2025A 7.7x → 2026F 3.5x → 2027F 1.7x → 2028F 0.8x
- Dividend Yield (2026F): 1.1%
🚀 2. [Market Opportunities & Business Outlook]
- 2Q26 Preliminary Earnings & DS Leadership:
- Consolidated revenue reached KRW 171.0T (+27.9% QoQ), with operating profit reaching KRW 89.4T (+56.2% QoQ).
- 2Q26 earnings absorbed an estimated ~KRW 17T in employee incentive provisions (covering 1Q and 2Q).
- Robust DRAM and NAND ASP increases significantly above previous estimates drove strong DS segment growth.
- Segment Details & 2H26 Outlook:
- DS (Memory): Elevated price trajectory is expected to sustain earnings improvements into 2H26, with DS division operating profit projected to match overall company-wide operating profit.
- MX/Network & VD/Appliances: Higher memory component costs pushed the MX/Network division into an operating loss in 2Q26, with deficits expected to persist in 2H26; VD/Appliances is also projected to post 2H26 operating losses due to weak consumer electronics demand.
- Display (SDC): Weaker YoY due to sluggish set sales, but 2H26 is expected to improve HoH on seasonality (though well surpassed by memory profit gains).
- Mid-to-Long-Term Growth Catalysts:
- The company’s strategic positioning is seen strengthening as memory importance rises within the AI ecosystem.
- HBM4 volume shipments are anticipated to ramp up in earnest starting in 3Q26, further strengthening the company’s position within the AI memory ecosystem.
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electronics as a company whose consolidated earnings growth is overwhelmingly driven by its DS division, where surging memory ASPs and next-generation AI memory positioning outweigh set division margin pressures and non-memory operating losses. This perspective places primary importance on the company’s strengthening position within the AI memory ecosystem and memory earnings expansion, rather than near-term losses across set and home appliance units.
To verify whether this investment thesis continues to materialize, key tracking points include the volume ramp-up of HBM4 shipments starting in 3Q26 and the subsequent strengthening of its AI memory position, the sustainability of commodity DRAM and NAND ASP increases in 2H26, and whether DS earnings growth continues to fully offset set division operating deficits. These developments can be confirmed through upcoming quarterly earnings releases, official regulatory filings, and company IR materials.
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