Layered Positive Factors for Samsung Electronics... Rising Expectations for Stock Price Increase↑

NVIDIA's Next-Generation GPU Orders... Expected Reflective Benefits from Huawei Smartphones

Samsung Electronics Galaxy Z Fold2 (Photo by Asia Economy DB)

[Asia Economy Reporter Kum Boryeong] Samsung Electronics is raising expectations for a stock price increase as it faces multiple favorable factors.

As of 10:05 AM on the 3rd, Samsung Electronics' stock price recorded 56,400 KRW, up 3.68% (2,000 KRW) compared to the previous session.

One of the positive factors is that Samsung Electronics has secured orders for NVIDIA's next-generation graphics processing units (GPUs). NVIDIA announced that most of the processors for its next-generation desktop PC graphics cards, the GeForce RTX 30 series, are produced using Samsung Electronics Foundry's 8nm process. Considering that NVIDIA sold about 58 million consumer graphics cards last year, it is expected that Samsung Electronics could generate more than $2 billion in additional annual foundry revenue from this order. Since NVIDIA GPUs are products attracting market attention, this is likely to help Samsung Electronics secure additional foundry customers.

Although there is a risk that memory semiconductor supply to Huawei may be suspended after the 15th, this is analyzed as an opportunity for Samsung Electronics to increase smartphone shipments. Last month, the U.S. Department of Commerce imposed additional sanctions on Huawei, prohibiting semiconductor manufacturers using any U.S. technology from trading with Huawei starting from the 15th.

The market particularly expects that shipments from Samsung Electronics and Apple will increase in non-China markets. Cho Cheolhee, a researcher at Korea Investment & Securities, explained, "Although demand may slow down after Huawei's inventory accumulation, demand from other smartphone companies to offset Huawei's demand decline could gradually increase," adding, "Supply chain analysis suggests that Apple and Samsung Electronics' smartphone shipment plans for this year are likely being revised upward compared to previous estimates."

On the 1st, Samsung Electronics unveiled the Galaxy Z Fold2, further widening the technological gap with new entrants. Foldable phones are expected to become Samsung Electronics' main segment. Noh Kyungtak, a researcher at Eugene Investment & Securities, said, "The Galaxy Z Fold2 is expected to maintain a significant lead in the foldable phone market for a considerable period," and added, "Although it is still difficult to compare with existing premium segments, the diversification of product lineups such as the Z Flip and entry-level models is expected to expand foldable phone sales from 3 million units this year to 8 million units next year."

Securities firms expect Samsung Electronics' third-quarter earnings to be better than the second quarter. NH Investment & Securities estimated that smartphone and home appliance performance will improve due to Huawei's indirect benefits and subsidies related to COVID-19, projecting operating profit to increase by 12% from the previous quarter to 9.1 trillion KRW. Shinhan Financial Investment also forecasted 8.96 trillion KRW, up 9.9% from the previous quarter.

The target stock price has entered the 70,000 KRW range consolidation. NH Investment & Securities and Shinhan Financial Investment set Samsung Electronics' target stock prices at 73,000 KRW and 72,000 KRW, respectively.

This content was produced with the assistance of AI translation services.