"Samsung Electronics on Track for 650,000 Won or 300,000 Won?"...For Retail Investors, It Sounds Like Empty Talk

[Financial News] Samsung Electronics posted record-high results in the second quarter of this year, but brokerage houses remain divided on the outlook for the semiconductor industry. After the earnings release, target prices issued by securities firms ranged from as low as 300,000 won to as high as 650,000 won, a gap of more than twofold.

According to the financial investment industry on the 31st, Samsung Electronics posted second-quarter sales of 171.4995 trillion won and operating profit of 8.94924 trillion won this year. That marked increases of 130 percent and 1,813.8 percent from a year earlier, respectively. Operating profit also beat market expectations by 5.5 percent, setting a new quarterly record.
Despite the strong results, among the eight domestic securities firms that issued reports, Korea Investment & Securities Co., Ltd. and Meritz Securities raised their target prices, while BNK Investment & Securities cut its estimate. The other five firms left their previous targets unchanged. In particular, the outlook gap between brokerages was stark, as concerns over slowing demand clashed with expectations that long-term contracts would stabilize profits.
BNK Investment & Securities, which offered the most cautious view, said the memory demand momentum had passed its peak. Reflecting that assessment, it lowered its target price from 430,000 won to 300,000 won while maintaining a buy rating.
Analyst Lee Min-hee said major hyperscalers in the United States are shifting their AI capital expenditures toward greater efficiency, while memory makers are expanding capacity on a large scale amid optimism. That, she warned, could lead to oversupply down the road.
She also said that bonus provisions, which were only partially reflected in the second quarter, will weigh on costs in the second half of the year. Continued losses in the System LSI and Device eXperience Division were also cited as reasons for the lower target price.

By contrast, Korea Investment & Securities focused on profit stability through multi-year contracts. It raised its target price by 10.2 percent from 590,000 won to 650,000 won and kept its buy rating.
Analyst Chae Min-suk described Samsung Electronics' five-year supply contracts with five major global hyperscalers as a "game with new rules." She argued that capital spending based on actual customer demand has sharply reduced the chronic oversupply risk that has long characterized the semiconductor cycle.
She also said the current share price is extremely undervalued, given the company's clear shareholder return policy and its future cash-generating ability, and added that investors should focus on its long-term corporate value.
[email protected] Sung Min-seo Reporter