"Samsung Electronics Will Post 110 Trillion Won in Operating Profit" Why Brokers Are Still Holding to a 600,000 Won Target and Predicting a Surprise Earnings Beat

[Financial News] Another brokerage report has said there has been no change in Samsung Electronics' fundamentals.
KB Securities kept its target price for Samsung Electronics at 600,000 won and maintained a "buy" rating. Although the stock has fallen more than 17% so far this month, the firm said the decline is excessive and that fundamentals will strengthen further in the second half.

According to the Korea Exchange on the 23rd, Samsung Electronics was trading at 269,000 won at 9:44 a.m., up 8,500 won, or 3.26%, from the previous session. The gain was attributed to improved global semiconductor investment sentiment after Alphabet raised its capital expenditures (CAPEX) outlook alongside its second-quarter earnings release the previous day, reflecting a larger push into AI investment. Samsung Electronics' share price has fallen 31.94% since closing at a record high on the 22nd of last month.
In a report released that day, KB Securities said it would keep its target price for Samsung Electronics unchanged at 600,000 won. Kim Dong-won, head of research at KB Securities, said, "With expanded production of HBM4 using 1c DRAM scheduled for 2027 and new mass production of HBM4E set for the first half of 2028, structural constraints on general-purpose DRAM capacity are expected to remain unavoidable for a long time. For that reason, we are maintaining our buy rating and 600,000 won target price."

For Samsung Electronics' earnings, the firm forecast three straight quarters of "earnings surprises." Kim said, "Revenue and operating profit in the third quarter of this year are expected to reach 209 trillion won and 110 trillion won, respectively, up 143% and 805% from a year earlier. As a result, we expect results to exceed market expectations for three consecutive quarters." He added, "Operating profit in the second half is expected to reach 234 trillion won, more than seven times higher than a year earlier."
Samsung Electronics' position as the top supplier in Google's memory market was also cited as a positive factor. Kim explained, "Google and other U.S. big tech companies believe that, given the race to secure an early lead in the AI market and surging demand, underinvestment in AI poses a greater risk than overinvestment." He added, "As a result, big tech companies' AI investment trend is expected to continue for the next three years."
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