Brokerage : SK Securities
Analyst : Dong-hee Han
Investment Rating : Buy (Maintained)
Target Price : KRW 300,000 (Upgraded)
Core Momentum : With AI demand expanding across DRAM and NAND amid complex supply constraints and upwardly revised 2026 ASP projections, full-year operating profit is projected to reach KRW 208T, supporting a fundamental redefinition of earnings power.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: Buy maintained, Target Price upgraded to KRW 300,000 (55.4% upside potential based on the February 23, 2026 closing price of KRW 193,000)
- Valuation Methodology: Applied a Target P/E of 13x to 2026E EPS of KRW 23,272, reflecting upgraded ASP forecasts, low supplier inventories, and structural AI memory demand
- Key Valuation Multiples (2026E): P/E 8.4x, P/B 2.3x, ROE 31.2%, EV/EBITDA 4.0x, Dividend Payout Ratio 7.1%
- Per-Share Metrics (2026E): EPS KRW 22,998 (Valuation base EPS KRW 23,272)
- Annual Financial Projections:
- 2026E (Summary Financial Table): Revenue KRW 536.16T, Operating Profit KRW 215.67T, Net Profit (Controlling) KRW 154.91T (Full-year text estimate: Operating Profit KRW 208T, YoY +376%, OPM 40%)
- 2027E: Revenue KRW 616.58T, Operating Profit KRW 221.97T, Net Profit (Controlling) KRW 163.83T
- 2028E: Revenue KRW 678.24T, Operating Profit KRW 210.25T, Net Profit (Controlling) KRW 157.43T
🚀 2. [Market Opportunities & Business Outlook]
- AI Memory Expansion & Structural Transformation:
- AI demand broadening beyond HBM to encompass the entire DRAM and NAND spectrum (complex requirements including capacity, bandwidth, and p99 latency)
- Increasing KV Cache in advanced AI inference elevates NAND into an active memory tier (exemplified by NVIDIA’s ICMS)
- Complex Supply Constraints & ASP Projections:
- Supply constraints compound beyond raw wafer capacity due to production mix, packaging, and sorting complexities
- Upwardly revised 2026 ASP forecasts: DRAM +158% YoY and NAND +98% YoY
- Demand Base Shift & Re-rating Catalysts:
- Transition from traditional economic replacement cycles to structural AI-driven system cycles, structuring memory demand and enhancing earnings predictability
- Long-Term Agreements (LTAs) expected to materialize within 1H to reinforce earnings visibility
- Additional valuation catalysts include fab/cleanroom space availability, HBM4 competitiveness recovery, and foundry utilization rebound
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electronics not merely as a cyclical memory producer, but as an enterprise whose structural earnings power warrants a fundamental upward redefinition, driven by the expansion of AI memory demand across DRAM/NAND and compounding multi-layered supply bottlenecks. This perspective places primary emphasis on the transition from traditional consumer replacement cycles to structural AI demand cycles, alongside enhanced earnings predictability supported by upcoming Long-Term Agreements (LTAs).
To verify whether this investment thesis continues to materialize, key verification points include whether realized 2026 DRAM (+158% YoY) and NAND (+98% YoY) ASP gains meet upgraded projections, whether the utilization of NAND within the AI memory hierarchy expands in practical inference environments with additional use cases following NVIDIA ICMS, and whether 1H Long-Term Agreements and HBM4 competitiveness recovery become tangible. These developments can be monitored through upcoming quarterly earnings releases, official IR materials, regulatory filings, and periodic financial reports.
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