Brokerage : Shinhan Securities
Analyst : Hyoung-tae Kim (Senior Research Analyst), Hye-soo Song (Research Analyst)
Investment Rating : Buy (Maintained)
Target Price : KRW 230,000 (Upgraded)
Core Momentum : Full-year 2026 operating profit is projected at KRW 157.1T, driven by maximizing price leverage from higher commodity memory exposure and leading capacity, expanding HBM demand, and ongoing supply shortages, supporting a target price upgrade to KRW 230,000.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: Buy maintained, Target Price upgraded by 33% to KRW 230,000 (43.1% upside potential based on the January 29, 2026 closing price of KRW 160,700)
- Valuation Methodology: Applied a Target PBR of 2.8x to 2026 estimated BPS of KRW 81,282
- Key Valuation Multiples (2026F): P/E 7.7x, P/B 2.0x, ROE 29.7%, EV/EBITDA 4.3x, Dividend Yield 2.6%
- Per-Share Metrics (2026F): BPS KRW 81,282
- Annual Financial Projections:
- 2024: Revenue KRW 300.87T, Operating Profit KRW 32.73T, Net Profit (Controlling) KRW 33.62T
- 2025F: Revenue KRW 333.61T, Operating Profit KRW 43.60T, Net Profit (Controlling) KRW 43.81T
- 2026F: Revenue KRW 474.56T (KRW 474.6T in text), Operating Profit KRW 157.12T (KRW 157.1T in text), Net Profit (Controlling) KRW 143.91T
- 2027F: Revenue KRW 508.93T, Operating Profit KRW 175.64T, Net Profit (Controlling) KRW 160.16T
🚀 2. [Market Opportunities & Business Outlook]
- 4Q25 Earnings Review (Sequential Improvement):
- Revenue of KRW 93.8T (+9% QoQ) and Operating Profit of KRW 20.1T (+65% QoQ)
- Operating Profit by Division: Semiconductor KRW 16.5T (DRAM KRW 15.3T, NAND KRW 1.9T, Non-memory loss of KRW 0.8T), Mobile KRW 1.9T, Consumer Electronics loss of KRW 0.6T, Display KRW 2.0T, Harman KRW 0.3T
- Pricing & Shipments: DRAM and NAND ASP rose +40% QoQ and +25% QoQ; bit growth was +2% and -12% QoQ. Strong display demand for North American clients helped offset consumer hardware softness
- 2026 Outlook & Semiconductor Competitiveness:
- Projected 2026 Revenue of KRW 474.6T and Operating Profit of KRW 157.1T
- ASP Growth Assumptions: Full-year DRAM and NAND ASP projected to increase +109% YoY and +97% YoY, respectively
- Core Drivers: 1) Maximizing operational leverage from high commodity memory exposure and largest production capacity, 2) Market share expansion expectations driven by growing HBM demand across next-generation accelerators (ASIC/GPU), and 3) Potential to reclaim the global No. 1 memory position in 2026
- Portfolio Diversification & Shareholder Returns:
- Demand visibility reinforced by high-value DRAM diversification (DDR5, LPDDR5, GDDR7, SO-CAMM), solid storage positioning (35% eSSD market share), and projected 3x YoY growth in full-year HBM revenue
- Upcoming additional shareholder return policies viewed positively
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electronics as an enterprise achieving KRW 157.1T in 2026 operating profit by maximizing operating leverage amid steep pricing gains—supported by its industry-leading capacity and high commodity memory exposure—despite margin pressures in downstream consumer set divisions. This perspective places primary emphasis on strong commodity memory price elasticity, potential 3x revenue expansion in HBM driven by next-generation accelerator (ASIC/GPU) demand, and reclaiming the No. 1 global memory ranking, rather than cost headwinds in consumer hardware.
To verify whether this investment thesis continues to materialize, key verification points include whether full-year DRAM (+109% YoY) and NAND (+97% YoY) ASP projections and operating profit (KRW 157.1T) are realized, whether next-generation accelerator HBM supply drives a 3x revenue increase and tangible share gains, and whether additional shareholder return programs are concretely announced and executed. These developments can be monitored through upcoming quarterly earnings releases, official IR presentations, regulatory filings, and periodic financial reports.
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