A Stock That Soared 756% in the First Half... As the Share Price Swings Wildly, Retail Investors Cry Out

[Financial News] Samsung Electro-Mechanics, which emerged as the leading AI stock after posting the biggest gain on the KOSPI (Korea Composite Stock Price Index) in the first half of this year, has recently been staging a roller-coaster rally, with its share price swinging nearly 30% in just one week. Profit-taking after the sharp short-term surge and broader market volatility sent the stock sharply up and down, but securities firms are raising their target prices one after another, saying demand for key AI server components is now entering a full-scale expansion phase.
According to the Korea Exchange on the 11th, Samsung Electro-Mechanics closed at 1,584,000 won the previous day, up 6.1%.
From the start of this year through the 30th of last month, Samsung Electro-Mechanics' share price rose 756.47%. Starting in the 270,000-won range at the beginning of the year, the stock surged to 2,184,000 won on the 30th of last month, marking the biggest 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, however. Samsung Electro-Mechanics hit an all-time intraday high of 2,205,000 won on the 1st, then tumbled as profit-taking orders flooded in, falling to 1,648,000 won on the 7th and 1,479,000 won on the 8th. In just five trading days, it dropped about 33% from its peak. It rebounded more than 6% on the day, but the stock continues to show extreme volatility, with swings of 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 strong urge to lock in gains. With volatility in the domestic stock market widening and corrections continuing across major AI-related large-cap stocks, selling pressure has concentrated on Samsung Electro-Mechanics, which had already posted a steep advance.
Still, securities firms remain 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 beat market expectations, supported by stronger shipments of AI server MLCC and higher FC-BGA prices, and that the expansion of long-term supply agreements (LTA) is creating a supplier-driven market. It also forecast that the company will post its best 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 lifted its operating profit forecasts for this year and next, reflecting stronger orders for AI server MLCC, expectations for price increases, and large-scale facility 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 around 410 billion to 420 billion won, above market consensus. As sales of high-value-added MLCC for AI servers expand and FC-BGA profitability improves at the same time, operating profit this year is expected to rise by nearly 70% to 90% from a year earlier.

[email protected] Park Ji-yeon Reporter