[Click eStock] "Samsung Electronics Must Secure Technological Competitiveness... Target Price↓"

On the 11th, NH Investment & Securities downgraded the target price of Samsung Electronics from 90,000 won to 75,000 won, stating that "in the short term, a full-scale supply of 5th generation high-bandwidth memory (HBM) and demand recovery momentum are needed, and in the mid to long term, securing technological competitiveness is necessary." The investment opinion of "buy" was maintained.

On the same day, Ryu Young-ho, a researcher at NH Investment & Securities, said, "We have revised down the earnings considering the steeper-than-expected decline in legacy (general-purpose) prices and the proportion of HBM."

Samsung Electronics' fourth-quarter sales are expected to reach 79.7 trillion won, and operating profit 9.6 trillion won, increasing by 17.6% and 239.2% respectively compared to the same period last year. Researcher Ryu said, "Weak demand and rising costs are expected to cause sluggishness in the DX (Device Experience) and SDC (Samsung Display) sectors," adding, "The DS division is expected to be negatively affected by foundry weakness and the legacy segment, but it will improve compared to the third quarter, which was weak due to one-time costs."

He noted, "Recently, demand for low-priced products has been strong, highlighting the influence of China's Changxin Memory Technologies (CXMT). A positive aspect is that all three major memory companies have a strong willingness to transition to advanced HBM processes and take a conservative stance on supply. This can somewhat defend against a sharp future decline in memory prices."

He added, "Currently, the stock price is trading at a price-to-book ratio (PBR) of 1, reflecting considerable concerns such as ▲weak demand in the upstream industry ▲doubts about technological competitiveness ▲the pursuit by Chinese companies including CXMT. There is valuation attractiveness," but also said, "However, with high uncertainty about demand, the upward momentum is limited. The stock price is expected to move within a range for the time being."

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