Brokerage : Mirae Asset Securities (Analyst: Younggun Kim)
Investment Rating : Buy (Maintained)
Target Price : KRW 550,000 (Maintained)
Core Momentum : Earnings and share price outlook supported by HBM4 price upside, conventional DRAM supply constraints stemming from HBM capacity allocation, and the necessity of additional treasury share buybacks for incentive compensation
📊 1. [Valuation & Key Financial Metrics]
- Rating & Target Price: Buy maintained, Target Price maintained at KRW 550,000 (Current price KRW 318,000 as of 2026.07.06, upside potential 73.0%)
- Earnings Forecast Summary:
- 2024A: Revenue KRW 300.9T, Operating Profit KRW 32.7T, Net Profit (controlling interest) KRW 33.6T
- 2025A: Revenue KRW 333.6T, Operating Profit KRW 43.6T, Net Profit (controlling interest) KRW 44.3T
- 2026F: Revenue KRW 720.2T, Operating Profit KRW 397.4T (YoY +811%), Net Profit (controlling interest) KRW 327.2T
- 2027F: Revenue KRW 951.9T, Operating Profit KRW 575.9T (YoY +45%), Net Profit (controlling interest) KRW 489.3T
- 2028F: Revenue KRW 1,032.1T, Operating Profit KRW 602.5T, Net Profit (controlling interest) KRW 541.2T
- Valuation Multiples & Financial Indicators:
- EPS: 2025A KRW 6,564 → 2026F KRW 49,058 → 2027F KRW 73,596 → 2028F KRW 81,405
- P/E: 2025A 18.3x → 2026F 6.5x (6.6x at current price) → 2027F 4.3x → 2028F 3.9x
- P/B: 2025A 1.9x → 2026F 2.7x (2.6x at current price) → 2027F 1.8x → 2028F 1.3x
- ROE: 2025A 10.8% → 2026F 55.4% → 2027F 50.9% → 2028F 39.1%
- Dividend Yield: 2025A 1.4% → 2026F 3.7% → 2027F 5.2% → 2028F 5.5%
🚀 2. [Market Opportunities & Business Outlook]
- 2Q26 Preliminary Earnings Estimates:
- Consolidated revenue estimated at KRW 171T (+28% QoQ), operating profit at KRW 89.4T (+56% QoQ).
- Segment Operating Profit Estimates: DS KRW 86T (Memory KRW 105T, Foundry -KRW 1T, absorbing 1Q/2Q bonus provisions of KRW 6T and KRW 12T), DX KRW 2.1T, SDC KRW 0.7T, HM KRW 0.6T.
- Memory Performance Metrics: DRAM B/G +4%, ASP +36% (operating profit KRW 65.6T, OPM 81.3%); NAND B/G +3%, ASP +54% (operating profit KRW 21.4T, OPM 69.5%). DRAM shipment growth and ASP missed prior estimates due to higher HBM3E shipments based on prior-year contract pricing.
- 3Q26 & 2027 Market Outlook:
- 3Q26 Forecast: Revenue estimated at KRW 201T (+18% QoQ) and operating profit at KRW 120T (+34% QoQ), supported by a projected ~15% QoQ ASP increase and ~5% QoQ bit growth across both DRAM and NAND.
- 2027 Price Dynamics: ASP gains projected to continue into 2027; HBM4 pricing likely to increase 2–3x YoY, extending DRAM price expansion as HBM volume limits conventional DRAM supply capacity.
- Shareholder Return & Treasury Share Buyback:
- Based on 2024–2026 FCF 50% shareholder return policy, current dividend yields are projected at up to 6.0% for common shares and over 10% for preferred shares.
- Considering the scale of performance bonus obligations versus the existing KRW 25T employee compensation treasury shares, additional treasury share repurchases are viewed as inevitable, with current share prices close to 1Q repurchase levels.
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electronics as a company with resilient earnings profitability and structural pricing power supported by the upcoming HBM4 transition, positioning its current valuation multiples as overly depressed following sharp market corrections over price momentum slowdown fears. This perspective emphasizes that HBM capacity absorption will tighten conventional DRAM supply and maintain upward pricing trajectories, rather than focusing on near-term ASP moderation caused by legacy-priced HBM3E contracts.
To verify whether this investment thesis continues to materialize, key tracking points include whether 3Q26 DRAM and NAND achieve the projected ~15% QoQ ASP increase to deliver KRW 120T in operating profit, whether HBM4 pricing premium and conventional supply tightness materialize into 2027, and whether additional treasury share buybacks are executed for employee incentive settlement. These developments can be confirmed through the upcoming earnings conference call (7/30), official regulatory filings, periodic reports, and IR releases.
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