"It Has Already Surged 700%, but It Could Rise Another 1 Million Won"...Foreign Investors Swarm This Stock in Pre-Market Trading

[Financial News] Samsung Electro-Mechanics has posted the highest share-price gain among all KOSPI stocks this year, and a bold forecast calling for a target price of 3 million won has drawn strong buying from foreign investors and high-return traders.

As of the close on the 17th, Samsung Electro-Mechanics finished at 2,032,000 won, down 0.78% from the previous session. The stock has risen 703.1% from the start of the year, marking the biggest gain among all KOSPI-listed stocks.
Foreign investors bought 81,556 shares of Samsung Electro-Mechanics net that day, worth about 165.7 billion won. Including trading on the NextTrade (NXT) market, foreign net buying on the 17th reached more than 180,000 shares, or about 380 billion won.
This foreign buying spree has continued since the beginning of the month. According to the Korea Exchange (KRX), foreign investors bought 1.317 trillion won worth of Samsung Electro-Mechanics shares net between the 1st and the 16th, the largest net purchase among all KOSPI stocks during that period.
Funds from high-return investors are also flowing in. According to Mirae Asset Securities, as of 11 a.m. that day, clients in the top 1% for investment returns had made Samsung Electro-Mechanics the second-most net-bought stock after Samsung Electronics.
The buying appears to reflect an optimistic outlook for future earnings.
DB Securities on the 1st issued a buy rating on Samsung Electro-Mechanics and set a striking target price of 3 million won. Analyst Jo Hyun-ji said Samsung Electro-Mechanics "holds an irreplaceable position" and predicted that "operating profit will rise 84.8% from this year to 3 trillion won next year, and reach 4.3 trillion won in 2028." 
Jo added that both high-density semiconductor package substrates (FCBGA) and multilayer ceramic capacitors (MLCC) are enjoying an unprecedented boom, and that valuation multiples for FCBGA and MLCC makers are continuing to rise. She said Samsung Electro-Mechanics deserves the highest multiple among global component stocks because it has top-tier technology in both parts and therefore occupies an irreplaceable position.
Meanwhile, institutions sold 1.397 trillion won worth of Samsung Electro-Mechanics shares over the same period, showing a sharp contrast. Experts view this as portfolio rebalancing after the stock's rapid short-term rally.


sms@fnnews.com Seong Min-seo Reporter