Brokerage : Shinhan Securities
Analyst : Hyoung-tae Kim (Senior Research Analyst), Hye-soo Song (Research Analyst)
Investment Rating : Buy (Maintained)
Target Price : KRW 173,000 (Upgraded)
Core Momentum : Full-year 2026 operating profit is projected to reach KRW 116.46T as the company enters a rapid earnings growth phase powered by steep DRAM/NAND ASP increases, expanding HBM3E/HBM4 penetration, and multiple expansion, lifting the target price by 18% to KRW 173,000.
📊 1. [Valuation & Key Financial Metrics]
- Investment Rating & Target Price: Buy maintained, Target Price upgraded by 18% to KRW 173,000 (34.6% upside potential based on the January 2, 2026 closing price of KRW 128,500)
- Valuation Methodology: Applied a Target PBR of 2.2x (upper bound of the historical PBR band) to 2026 estimated BPS of KRW 78,610
- Key Valuation Multiples (2026F): P/E 8.3x, P/B 1.6x, ROE 22.1%, EV/EBITDA 4.1x, Dividend Yield 1.2%
- Per-Share Metrics (2026F): BPS KRW 78,610
- Annual Financial Projections:
- 2024: Revenue KRW 300.87T, Operating Profit KRW 32.73T, Net Profit (Controlling) KRW 33.62T
- 2025F: Revenue KRW 331.12T, Operating Profit KRW 42.89T, Net Profit (Controlling) KRW 42.17T
- 2026F: Revenue KRW 427.64T, Operating Profit KRW 116.46T (OPM 27.2%), Net Profit (Controlling) KRW 105.79T
- 2027F: Revenue KRW 468.08T, Operating Profit KRW 117.70T, Net Profit (Controlling) KRW 106.47T
🚀 2. [Market Opportunities & Business Outlook]
- 4Q25 Earnings Preview (Consensus Beat Expected):
- Projected Revenue of KRW 91.4T (+6.1% QoQ) and Operating Profit of KRW 19.4T (+59.1% QoQ), beating consensus (Revenue KRW 89.2T, Operating Profit KRW 16.5T)
- Operating Profit by Division: Semiconductor KRW 15.8T (DRAM KRW 14.8T, NAND KRW 1.5T, Non-memory loss of KRW 0.5T), Mobile KRW 2.1T, Consumer Electronics loss of KRW 0.1T, Display KRW 1.1T, Harman KRW 0.4T
- Pricing & Shipments: DRAM and NAND ASP rose sharply (+36% and +16% QoQ), with bit growth estimated at +3% and -1% QoQ, respectively
- 2026 Memory Up-Cycle & HBM Expansion:
- Memory capacity expansion constraints from focusing Capex on advanced nodes and high-value lines (HBM, DDR5) will sustain steep price increases through 2026
- HBM Market Penetration: Expanding memory density across next-generation customer accelerators (ASIC/GPU) is expected to drive HBM3E revenue contribution in 1H26 and HBM4 in 2H26 (narrowing price gaps between HBM and commodity DRAM eases valuation discount drivers)
- Broad-Based AI Beneficiary: Diversified premium DRAM (HBM, DDR5, LPD5X, GDDR7, SO-CAMM2) and storage strength (eSSD) create potential for 2026 blended ASP growth to outperform peers
- Foundry Recovery & Shareholder Returns:
- Expectations remain valid for foundry fab utilization recovery and operational improvements
- Potential for additional shareholder return initiatives
📝 Editor’s Comment (Perspective)
The analyst views Samsung Electronics as entering a steep earnings expansion phase toward KRW 116.46T in 2026 operating profit, led by the Semiconductor division (projected at KRW 15.8T in 4Q25) on rapid DRAM and NAND pricing gains and an expanding mix of high-value products, despite minor deficits in consumer electronics and non-memory. This perspective places primary emphasis on the prolonged memory pricing up-cycle supported by disciplined Capex, the easing of valuation discounts as HBM-commodity price gaps narrow, and expanding market penetration via 1H26 HBM3E and 2H26 HBM4, rather than near-term non-memory headwinds.
To verify whether this investment thesis continues to materialize, key verification points include whether 4Q25 preliminary operating profit (KRW 19.4T) and full-year 2026 operating profit (KRW 116.46T) meet forecasts, whether HBM3E (1H26) and HBM4 (2H26) shipments ramp up to expand revenue contribution, whether blended ASP strength holds across premium DRAM and eSSD lines, and whether foundry utilization recovery and additional shareholder return programs are concretely announced. These developments can be tracked through upcoming quarterly earnings announcements, official IR materials, regulatory filings, and periodic financial reports.
📢 Disclaimer & Source
Source: This content has been structured and newly written based on officially disclosed financial facts and data from brokerage reports.
Investment Risk Notice: This content is provided for informational and linguistic reference purposes only. Under no circumstances does it constitute financial advice or a recommendation to buy or sell any specific securities. All investment decisions and financial responsibilities rest entirely with the investor.
Contact: Compliance and Copyright Inquiries (ksb220805@gmail.com)
