A Stock Soared 756% in the First Half... As the Share Price Swung Wildly, Retail Investors Let Out a Scream

[Financial News] Samsung Electro-Mechanics, which ranked first in KOSPI gains in the first half of this year and emerged as a leading AI stock, has recently been staging a roller-coaster session, with sharp swings of nearly 30% over the past week. The share price was hit hard by profit-taking after a rapid run-up and by broader market volatility. Still, securities firms say demand for key AI server components is now entering a full-fledged expansion phase, and they are raising their target prices one after another.
According to the Korea Exchange on the 11th, Samsung Electro-Mechanics closed the previous day up 6.1% at 1,584,000 won.
From the start of this year through the 30th of last month, Samsung Electro-Mechanics' share price surged 756.47%. Starting the year in the 270,000-won range, the stock climbed to 2,184,000 won on the 30th of last month, posting the highest gain among KOSPI-listed companies. Analysts say expectations for rising demand for multilayer ceramic capacitors (MLCC) and flip chip ball grid array (FC-BGA) substrates, driven by expanded AI server investment, pushed the stock higher.
The rally did not last long. Samsung Electro-Mechanics hit an all-time intraday high of 2,205,000 won on the 1st, then fell sharply as profit-taking orders flooded in, dropping to 1,648,000 won on the 7th and to 1,479,000 won on the 8th. In just five trading days, it had fallen about 33% from its peak. It rebounded more than 6% on the day, but the stock continues to swing by hundreds of thousands of won in a short period.
The market sees this as the result of valuation concerns after the rapid rise, combined with a desire to lock in gains. With volatility in the domestic stock market widening and corrections continuing across major AI-related stocks, selling pressure has concentrated on Samsung Electro-Mechanics, which had already posted a steep advance.
Even so, the outlook from securities firms remains upbeat. Recent reports from major brokerages have uniformly raised earnings forecasts and lifted target prices.
Sangsangin Investment & Securities raised its target price to 2.5 million won. It said second-quarter operating profit is likely to exceed market expectations, supported by higher shipments of MLCC for AI servers and stronger FC-BGA pricing. The firm also noted that expanded long-term supply agreements (LTA) are creating a supplier-driven market, and it forecast that the company will post its highest quarterly results in the third quarter of this year.
Yuanta Securities Korea raised its target price from 2.2 million won to 2.8 million won. It increased its operating profit forecasts for this year and next, reflecting stronger MLCC orders for AI servers, expectations for price increases, and large-scale capital investment. Kiwoom Securities also initiated coverage with a target price of 2.8 million won and a "buy" recommendation.
The earnings outlook is also bright. Securities firms expect Samsung Electro-Mechanics' second-quarter operating profit to come in at 410 billion to 420 billion won, above market consensus. With sales of high-value-added MLCCs for AI servers expanding and FC-BGA profitability improving at the same time, operating profit this year is expected to rise by nearly 70% to 90% from a year earlier.

nodelay@fnnews.com Park Ji-yeon Reporter