Samsung C&T: As Expectations for Shareholder Returns Rise... "Stock Still Undervalued"

[Financial News] SK Securities maintained its "Buy" rating and 550,000-won target price for Samsung C&T on the 23rd, saying the stock remains undervalued despite expectations for increased shareholder returns.
Choi Kwan-soon, an analyst at SK Securities, said, "Samsung C&T redistributes 60–70% of its dividend income from affiliates, so expectations for cash dividends will rise as Samsung Electronics increases its dividend. Because Samsung C&T's dividend payment early next year is linked to the dividend income it receives from affiliates this year, it is expected to include Samsung Electronics' third-quarter dividend."
He added, "When this is converted into Samsung C&T's dividend per share (DPS), the dividend per share expected early next year will be 8,550 won, significantly exceeding the consensus. If Samsung Electronics' increased dividend leads to a larger dividend from Samsung Life Insurance, Samsung C&T's dividend funds will also increase further."
He continued, "Samsung C&T's expanded shareholder returns have become more visible following Samsung Electronics' announcement of a large-scale shareholder-return policy. However, Samsung C&T's discount to net asset value (NAV) stands at 57.8%, showing only a modest improvement from 58.5% at the beginning of the year. If Samsung Electronics' quarterly dividend is finalized next month and Samsung C&T's solid earnings are confirmed, the discount to NAV is expected to narrow further."
He also highlighted the continuation of solid earnings. Samsung C&T's revenue this year is expected to reach 45.8 trillion won, while operating profit is projected at 3.8 trillion won, representing year-on-year increases of 12.3% and 15.1%, respectively.
Choi said, "Samsung Electronics-related revenue accounted for 16.1% of Samsung C&T's separate-basis revenue last year, rising to 29.2% in the first half of this year. Earnings are expected to continue improving, as growth is forecast to accelerate in the second half with high-tech processes entering full swing."

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