Brokerage : Eugene Investment & Securities (Analyst: Seungwoo Lee)
Investment Rating : STRONG BUY (Maintained)
Target Price : KRW 560,000 (Maintained)
Core Momentum : Multi-year earnings and valuation momentum driven by memory inventory build-up competition, potential LTA contracts with datacenter hyperscalers, and expectations for 50% FCF shareholder returns
📊 1. [Valuation & Key Financial Metrics]
- Rating & Target Price: STRONG BUY maintained, Target Price maintained at KRW 560,000 (Current price KRW 309,500 as of 2026.07.03)
- Earnings Forecast Summary:
- 2025A: Revenue KRW 333.6T, Operating Profit KRW 43.6T, Net Profit KRW 45.2T
- 2026E: Revenue KRW 695.0T, Operating Profit KRW 361.3T (upward revision from KRW 355.8T, YoY +726%), Net Profit KRW 324.5T
- 2027E: Revenue KRW 951.0T, Operating Profit KRW 589.4T (upward revision from KRW 583.8T, YoY +63%), Net Profit KRW 532.2T
- Valuation Multiples & Financial Indicators:
- EPS: 2025A KRW 7,477 → 2026E KRW 53,966 → 2027E KRW 88,306
- PER: 2025A 16.0x → 2026E 5.7x → 2027E 3.5x
- PBR: 2025A 1.9x → 2026E 2.8x → 2027E 1.8x
- ROE: 2025A 10.8% → 2026E 55.2% → 2027E 55.0%
- EV/EBITDA: 2025A 7.5x → 2026E 4.0x → 2027E 2.0x
- Dividend Yield (2026E): 4.2%
🚀 2. [Market Opportunities & Business Outlook]
- 2Q26 Earnings Forecast:
- Consolidated revenue projected at KRW 168.1T (+26% QoQ), operating profit at KRW 83.1T (+45% QoQ), absorbing full 1Q-2Q incentive bonus provisions.
- DS Segment: Operating profit expected at KRW 81.6T (+52% QoQ), led by Memory operating profit of KRW 83.1T amid intense customer inventory competition.
- Blended ASP Outperformance: Aggressive price hike policy and pre-emptive HBM4 shipments are estimated to secure industry-leading blended ASP levels.
- Non-Memory & Set Division Breakdown:
- Foundry/LSI: Annual turnaround to profitability remains unlikely due to bonus provisions despite advanced node utilization recovery; however, order expansion expectations for leading-edge nodes and memory-linked customer strategies support mid-to-long-term competitiveness.
- MX/NW: Operating profit projected at KRW 0.8T (-71% QoQ) due to memory cost inflation; focusing on 2H margin defense via ASP increases and premium product mix expansion.
- SDC: Operating profit projected at KRW 0.3T (-17% QoQ) supported by relatively solid flagship smartphone demand.
- Pricing & Shareholder Return Drivers:
- Price Negotiations: 3Q26 commodity DRAM and NAND ASP negotiations are progressing toward >20% QoQ increases, lifting ASP trajectory through 2027.
- LTA Negotiations: Ongoing Long-Term Agreement negotiations with major datacenter clients, with conclusion timing concentrated in 3Q26 under favorable terms.
- Shareholder Return Competition: Amid expected shareholder return competition among memory makers in 2H, Samsung Electronics is expected to utilize approximately 50% of annual FCF for shareholder returns, potentially centered on treasury share cancellations.
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electronics as a company maximizing memory-driven earnings growth and pricing leverage through aggressive ASP policies, pre-emptive HBM4 shipments, and hyperscaler LTA discussions, which outweigh near-term cost pressures in MX and delayed profitability in Foundry. This perspective emphasizes the qualitative strength of the company’s blended ASP outperformance and potential FCF-driven shareholder returns over temporary set-division margin compression.
To verify whether this investment thesis continues to materialize, key tracking points include whether 3Q26 commodity DRAM and NAND secure ASP increases exceeding 20% QoQ, the formalization of LTA agreements under favorable terms with major datacenter clients in 3Q26, and the actual announcement and details of shareholder return policies regarding the potential utilization of 50% of annual FCF for share cancellations. These developments can be confirmed through upcoming quarterly earnings announcements, periodic reports, 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.
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