Brokerage : Hana Securities
Analyst : Rok-ho Kim (RA: Kyung-gyu Kim)
Investment Rating : BUY (Maintained)
Target Price : KRW 222,000 (Upgraded)
Core Momentum : Full-year 2026 operating profit is revised upward to KRW 168T, driven by surging DRAM/NAND ASPs and confirmed HBM3E/HBM4 customer allocations lifting Memory operating profit to KRW 160T, alongside separate HBM valuation multiples and shareholder return expansion.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: BUY maintained, Target Price upgraded to KRW 222,000 (Current price as of January 29, 2026: KRW 160,700)
- Valuation Methodology: Applied a separate valuation multiple to the HBM business alongside a 49% upward revision to 2026 full-year operating profit
- Key Valuation Multiples (2026F): P/E 7.95x, P/B 1.97x, ROE 28.46%, EV/EBITDA 2.32x
- Per-Share Metrics (2026F): EPS KRW 20,215 (YoY +235.02%), BPS KRW 81,400, DPS KRW 1,465
- Annual Financial Projections:
- 2024: Revenue KRW 300.87T, Operating Profit KRW 32.73T, Net Profit KRW 33.62T
- 2025F: Revenue KRW 333.61T, Operating Profit KRW 43.62T, Net Profit KRW 44.28T
- 2026F: Revenue KRW 516.00T (YoY +55%), Operating Profit KRW 168.14T (KRW 168T in text, YoY +284%), Net Profit KRW 136.16T (substantially exceeding consensus of Revenue KRW 441.61T and Operating Profit KRW 126.50T)
🚀 2. [Market Opportunities & Business Outlook]
- 4Q25 Earnings Review:
- Memory and Display led earnings (DRAM ASP +40% and NAND ASP +22% drove OPM close to 60% and 30%, respectively)
- Display outperformed expectations on North American client peak seasonality
- Foundry/System LSI posted wide operating losses; MX recorded its weakest profitability in 3 years due to flagship mix compression and BOM inflation; VD/DA and Harman were sluggish due to raw material cost increases
- 2026 Outlook & Memory Surge:
- Projected 2026 Revenue of KRW 516T (+55% YoY) and Operating Profit of KRW 168T (+284% YoY)
- Memory Division Earnings: Memory operating profit projected to surge +412% YoY to KRW 160T, driving corporate earnings (assuming DRAM ASP +139% and NAND ASP +74%)
- HBM & ASIC Opportunities: HBM revenue projected to increase +158% YoY with smooth customer allocations across HBM3E and HBM4 for GPU/ASIC clients (HBM revenue share estimated in the mid-10% range due to sharp commodity DRAM growth)
- Set Division Weakness: MX operating profit estimated down -50% YoY to KRW 6.5T due to cost inflation; VD/DA losses expected to persist
- Shareholder Return Expansion:
- 4Q25 dividend payout increased by adding KRW 1.3T in special dividends to the base quarterly payout of KRW 2.45T, totaling KRW 3.75T
- The current policy of allocating 50% of FCF to shareholder returns supports expectations for higher 2026 regular dividends, special dividends, and potential share repurchase/cancellation programs
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electronics as a memory-led turnaround enterprise achieving KRW 168T in 2026 operating profit—propelled by surging DRAM/NAND prices and confirmed customer shipments of HBM3E/HBM4 lifting Memory operating profit to KRW 160T—which outweighs ongoing losses and cost inflation in Set (MX/VD/DA) and non-memory divisions. This perspective places primary emphasis on the justification of applying separate valuation multiples to HBM following competitiveness recovery, low valuation relative to global peers, and expanded shareholder return capacity supported by the current policy of allocating 50% of FCF to shareholder returns.
To verify whether this investment thesis continues to materialize, key verification points include whether realized 2026 DRAM (+139%) and NAND (+74%) ASP increases and full-year operating profit (KRW 168T) meet upgraded forecasts, whether HBM3E and HBM4 customer shipments to GPU and ASIC clients expand smoothly, and whether regular dividend upgrades and additional shareholder return programs materialize through FCF generation. These developments can be tracked through upcoming quarterly earnings releases, official IR presentations, regulatory filings, and periodic financial reports.
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