Disclaimer: This article is for informational purposes only and does not constitute financial advice.
Investment Thesis and Target Price
DS Investment & Securities maintains a Buy investment rating and a Target Price of 530,000 KRW (~$370.63 USD based on 1430 KRW/USD). The brokerage views the company as poised for unprecedented profit growth, driven by its industry-leading supply capacity and enhanced competitiveness in HBM4. The valuation is supported by strong long-term demand visibility, with long-term supply agreements (LTA) covering 60-70% of total capacity, and an expected deepening of supply shortages through 2027 and 2028.
Earnings Estimates and Financial Preview
For 2Q26, revenue was confirmed at 171.5 trillion KRW (~$119.9B USD, +28% QoQ) with an operating profit of 89.5 trillion KRW (~$62.6B USD, +56% QoQ), representing an operating profit margin (OPM) of 52%. This includes an estimated 17.6 trillion KRW (~$12.3B USD) for incentive provisions. For 3Q26, consolidated operating profit is projected to rise to 115.4 trillion KRW (~$80.7B USD, +29% QoQ), led by the DS division’s 115 trillion KRW (~$80.4B USD) contribution, despite a widening loss in the DX division (-1.3 trillion KRW / ~$909M USD). Annual operating profit estimates have been revised upward to 392 trillion KRW (~$274.8B USD, +799% YoY) for 2026 and 639.6 trillion KRW (~$447.3B USD, +63% YoY) for 2027.
Key Semiconductor Drivers and Outlook
The memory sector showed stronger-than-expected performance in 2Q26, with DRAM ASP increasing by 44% and NAND ASP by 67%. A critical catalyst is the ramp-up of HBM4, with revenues expected to grow more than threefold QoQ in 3Q26 and account for over 60% of total HBM sales in the second half of the year. In the Foundry business, performance improvement is expected from the mass production of 4nm-based LPUs and the expansion of base dies for HBM. Additionally, the company has secured 2nm projects from major customers, with the number of 2nm design wins expected to more than double YoY. Future capacity expansion is being considered for 1.4nm processes due to increasing customer inquiries.
🔗 Original Source: View the official filing/article here.