Disclaimer: This article is for informational purposes only and does not constitute financial advice.
📌 Key Research Highlights
- Broker: Eugene Investment & Securities | Rating: Strong Buy (Maintained)
- Target Price: 560,000 KRW (~$414.20 USD based on 1352 KRW/USD) (Maintained)
- Core Thesis: Despite short-term headwinds in the DX division and FX volatility, the company is positioned for long-term growth through its unique “Turnkey” capability integrating Memory and Foundry, alongside aggressive pricing strategies for High Bandwidth Memory (HBM) and server DRAM.
Investment Thesis and Target Price
Eugene Investment & Securities maintains a Strong Buy rating and a Target Price of 560,000 KRW (~$414.20 USD based on 1352 KRW/USD). The analyst views the stock as being in a phase where it will gradually rise in the mid-to-long term, reflecting the sustainability of the semiconductor industry cycle and consistent shareholder returns. A key differentiator for Samsung Electronics is its Turnkey capability—the synergy between Memory and Foundry—which enhances competitiveness in the AI semiconductor market and supports the expansion of memory market share. The analyst expects the company to maintain industry-leading Blended ASPs for an extended period through an aggressive pricing policy.
Earnings Estimates and Financial Preview
3Q26 Forecast: Consolidated operating profit is estimated at 103.6 trillion KRW (~$76.63B USD), a 16% increase Quarter-over-Quarter (QoQ). This estimate reflects a downward adjustment due to a lowered KRW/USD exchange rate assumption (from 1,440 to 1,400 KRW/USD), widening losses in the MX division, and additional performance bonus provisions.
- DS (Device Solutions) Division: Estimated operating profit of 104.0 trillion KRW (~$76.93B USD, +17% QoQ). Growth is driven by price hikes in server DRAM and eSSD, with Blended ASPs for DRAM and NAND Flash expected to rise by 17% and 18% QoQ, respectively.
- DX (Device Experience) Division: Estimated operating loss of 1.8 trillion KRW (~$1.33B USD). While sales volumes for new products like the Galaxy Z Fold 8 are expected to exceed forecasts due to a market-share-focused pricing strategy, the inability to pass on rising costs is expected to widen the operating deficit.
Future Outlook: 4Q26 operating profit is projected at 114.9 trillion KRW (~$84.98B USD, +11% QoQ). Annual operating profit estimates were revised downward due to FX adjustments to 365.2 trillion KRW (~$269.98B USD, +735% YoY) for 2026 and 595.8 trillion KRW (~$440.68B USD, +63% YoY) for 2027.
Key Semiconductor Drivers and Catalysts
- HBM & Advanced Memory: Rapid ramp-up of HBM4 and the introduction of 3D Stacked DRAM and zHBM to address the “Memory Wall” are critical catalysts. HBM operating profit is forecasted to grow significantly from 3.8 trillion KRW (~$2.81B USD) in 3Q26 to 26.9 trillion KRW (~$19.89B USD) by 4Q27.
- Foundry & LSI: Revenue growth is expected in the second half of the year, driven by the expansion of HBM4 base die production, mass production of Groq 3 LPU, and price increases for advanced processes.
- Market Dynamics: The pricing negotiation environment for general-purpose DRAM, NAND Flash (4Q26-1Q27), and HBM (2027) is viewed as favorable for suppliers, suggesting potential for further upward revisions of price assumptions.
🔗 Original Source: View the official filing/article here.