"Let's Buy More Samsung Electronics"... Some Predict Dividends Could Reach 10,000 Won Per Share

[Financial News] Investors are closely watching how much Samsung Electronics will set its dividend at, as the stock remains one of the most popular holdings among retail investors.
According to industry sources on the 18th, Samsung Electronics will hold its 57th annual general shareholders’ meeting at 9 a.m. that day at the Suwon Convention Center in Suwon, Gyeonggi Province, using the convention hall on the third floor and the exhibition hall on the first floor. Items to be reported include the audit report, business report, and the status of the internal accounting control system. Agenda items include amendments to the articles of incorporation, approval of the 2025 financial statements, appointment of Kim Yong-gwan as an inside director, appointment of outside director Heo Eunnyeong as a member of the audit committee, approval of the limit on directors’ remuneration, and approval of plans to hold and dispose of treasury shares.
Since launching Phase 1 of its shareholder return program in 2015, Samsung Electronics has been operating the policy in three-year cycles. The core principle is to return 50% of the free cash flow (FCF) generated over each three-year period to shareholders. FCF refers to the "free cash" accumulated in a company’s coffers after deducting capital expenditures and merger and acquisition (M&A) costs from cash generated by operating activities.
Brokerages have a particular reason to focus on this year’s shareholders’ meeting. This year marks the final year of Phase 4 (2024–2026) of the shareholder return policy. When Samsung Electronics wrapped up its three-year policy for 2018–2020, it also carried out a large-scale special dividend.
In particular, the 4.2 million small shareholders are fixated on whether there will be a special dividend. A special dividend is a kind of bonus dividend paid in addition to regular dividends under the shareholder return policy.
Based on Samsung Electronics’ sharp earnings improvement and its strong commitment to shareholder returns, some in the securities industry are putting forward bold projections that total dividends this year could approach 10,000 won per share.
Hyungkeun Ryu, an analyst at Daishin Securities, estimates that this year’s dividend per share (DPS), including special dividends, will reach 9,650 won. He assessed that as the company’s ability to generate free cash flow (FCF) strengthens, the environment is becoming more favorable for enhancing shareholder returns over the medium to long term.
Kim Young-gun, an analyst at Mirae Asset Securities, said, "This year, Samsung Electronics’ earnings will be impressive, but the scale of shareholder returns could be even more surprising," adding, "Based on free cash flow (FCF) of more than 60 trillion won, a special shareholder return should be feasible."
Kim projected that if Samsung Electronics meets the government’s requirement for separate taxation of dividend income—a payout ratio of 25%—its dividend per share could increase to around 8,110 won.
Kim Rok-ho, an analyst at Hana Securities, offered a similar outlook when he raised his target price for Samsung Electronics to 300,000 won on the 12th. He estimated, "If we assume that the 93 trillion won in shareholder return resources expected for this year is used for dividends and share buybacks, the dividend per share will jump 388% year-on-year to about 8,135 won."
Foreign brokerages are also focusing on the possibility of an extraordinary dividend. Macquarie Securities, which last month set a target price of 340,000 won, predicted, "Samsung Electronics may carry out a special dividend of around 100 trillion won at the end of the year." Considering that Samsung Electronics has typically paid regular annual dividends of around 10 trillion won, 100 trillion won would be roughly ten times its usual level.
fair@fnnews.com Han Young-jun Reporter