SK hynix at KRW 40 Trillion, Samsung Electronics at KRW 110 Trillion... What Is the Next Move for Semiconductor Stocks?

[Financial News] Hana Securities said on the 24th that an overweight strategy remains valid for the semiconductor sector, citing expectations for shareholder returns from Samsung Electronics and SK hynix, as well as solid memory exports. It added that share buybacks by the two companies are supporting supply and demand, and that expectations for additional shareholder returns are likely to continue through year-end.
Kim Rok-ho, a researcher at Hana Securities, said, "Domestic memory makers closed higher for two straight weeks for the first time in a while," and added, "They disclosed shareholder return-related details earlier than expected."
SK hynix has decided to buy back and cancel KRW 40 trillion worth of treasury shares, and it plans to mention additional shareholder return measures in its third- and fourth-quarter earnings release. Samsung Electronics also updated its three-year shareholder return policy for 2024 to 2026. Hana Securities expects Samsung Electronics to pay out a total of KRW 30 trillion in dividends, including KRW 2.45 trillion in regular dividends for the third and fourth quarters. It estimated the dividend per share at about KRW 4,560, including regular dividends.
The brokerage also highlighted Samsung Electronics' room for additional shareholder returns. Hana Securities estimated the remaining shareholder return resources for 2026 at between KRW 90 trillion and KRW 110 trillion. After the 2026 fiscal year closes, Samsung Electronics plans to decide the remaining shareholder return amount and specific implementation measures at a board meeting scheduled for late January next year, and then announce them separately.
Kim said, "Both companies are expected to become more comfortable to approach from a supply-and-demand perspective thanks to share buybacks," and explained, "Samsung Electronics is relatively small in scale and the shares are not being canceled, so it will contribute only modestly to short-term supply and demand rather than to shareholder returns." He added, "However, since there are still KRW 90 trillion to KRW 110 trillion in remaining shareholder return resources, expectations related to this should remain valid."
Export data supporting the memory market also remained strong. Through the 20th of this month, average daily memory semiconductor exports reached $1.53 billion, up 259% from a year earlier. DRAM exports surged 477% to $750 million, while NAND flash memory exports rose 317% to $130 million. MCP and solid-state drive (SSD) exports also increased 57% and 202%, respectively, to $360 million and $160 million.
On this, Kim said, "As export values rose across all memory categories from a year earlier, DRAM, NAND flash memory, and SSD posted triple-digit growth rates, extending the solid export trend," and assessed that "we were able to confirm once again the strong upward trend in memory prices."
This week, NVIDIA Corporation's earnings release, scheduled for the 27th, is expected to be a key factor for semiconductor investor sentiment. Kim said, "Along with the earnings guidance, we need to check whether CoWoS packaging capacity and bottlenecks in HBM3E and High Bandwidth Memory 4 supply are being eased, and whether shipments are being made on schedule for mass production without yield issues." He also pointed to whether demand from companies waiting for next-generation chips, including major cloud service providers, will remain solid through year-end and into next year, and whether the gross profit margin can stay in the low 70% range, as key points to watch.
[email protected] Choi Du-seon Reporter