"60,000 Electronics" Small Investors Betting Big... Diverging Securities Market Outlook

[Asia Economy Reporter Junho Hwang] Individual investors are betting on Samsung Electronics, which has not been able to escape the "60,000 won stock price" trap (60,000 won per share).

According to the Korea Exchange on the 8th, individual investors poured 1.0944 trillion won into Samsung Electronics over two days starting from the 6th. On average, they purchased 547.2 billion won worth of Samsung Electronics shares per day. This is the first time in a month since the 7th of last month that individuals have net bought more than 500 billion won worth of Samsung Electronics shares in a single day. It is estimated that about 42% of the total net buying amount of individual investors in the KOSPI over the two days, which amounted to 2.5608 trillion won, was concentrated on Samsung Electronics. Amid the situation where recovering the "70,000 won stock price" since the 23rd of last month seems difficult, a low-price buying trend appears to have gathered. Samsung Electronics’ stock price closed down 0.73% on the 7th despite announcing record-high quarterly earnings.

Market forecasts are divided. KB Securities and Hana Financial Investment lowered Samsung Electronics’ target price from 100,000 won to 90,000 won and from 101,000 won to 90,000 won, respectively, on the same day. Dongwon Kim, a researcher at KB Securities, explained, "Due to downward revisions of earnings estimates caused by external uncertainties, the average return on equity (ROE) over the next three years is expected to decrease from 13.7% to 13.3%, and the cost of equity is expected to increase from 8.0% to 8.9%." Kyungmin Kim, a researcher at Hana Financial Investment, said, "This reflects lowered expectations for the non-memory semiconductor business," adding, "When estimating the target price using the Sum of the Parts (SOTP) valuation by business segment, the price-to-earnings ratio was lowered from 30 times to 15 times, which is lower than Taiwan’s TSMC (18?19 times), a competitor and the world’s largest semiconductor foundry."

On the other hand, Minseong Hwang, a researcher at Samsung Securities, maintained the target price at 100,000 won, stating, "The smartphone business recorded an earnings surprise in the first quarter of this year, proving its cost competitiveness," and added, "The true strength of the memory semiconductor business is expected to be confirmed from next year, and although the US and Europe are trying to regain semiconductor leadership, it is impossible to replace Samsung Electronics."

Meanwhile, as of 10:51 a.m. on the same day, Samsung Electronics’ stock price was recorded at 68,100 won, up 0.15%.

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