Will Samsung Electronics and SK Hynix Rebound on Shareholder Returns? Samsung Electronics Seen With Up to 200 Trillion Won a Year

As Samsung Electronics and SK hynix move closer to large-scale shareholder returns, expectations are growing that domestic semiconductor stocks could be revalued. Backed by a boom in Artificial Intelligence (AI) memory, both companies have seen cash generation improve sharply. Samsung Electronics is preparing to announce a new shareholder-return policy, while SK hynix plans to finalize additional measures in the third quarter of this year.
According to the investment banking industry on the 10th, KB Securities said Samsung Electronics' upcoming shareholder-return policy could range from at least 100 trillion won to as much as 200 trillion won a year.
That would be more than 10 times larger than the current annual shareholder-return scale of 9.8 trillion won. Kim Dong-won, Head of Research at KB Securities, said, "Even if the shareholder-return amount is set at just 100 trillion won, the dividend yield at the current share price could exceed 7%." He added, "Large-scale shareholder returns could become a key catalyst for a stock-price revaluation."
KB Securities maintained its "buy" rating on Samsung Electronics and its target price of 600,000 won.
SK hynix is also moving quickly to expand shareholder returns. On the 7th, the company disclosed, "We are actively reviewing additional shareholder-return measures to enhance shareholder value," and added, "Specific details are expected to be finalized and announced in the third quarter."
Compared with the company's earlier statement during its second-quarter earnings release that it would share its shareholder-return plan within the year, the announcement timeline has been brought forward.
In the market, special dividends and treasury share buybacks and cancellations are being discussed as likely options. SK hynix has previously said it would use 50% of its free cash flow to the firm (FCF) for shareholder returns.
Brokerages expect SK hynix's FCF this year to reach the mid-100 trillion won range. The company already canceled 12.2 trillion won worth of treasury shares last December and has also raised its annual dividend to as much as 3,000 won per share.

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