Samsung Electronics: Maintain Buy despite market’s overconcern

Research evidence excerpt

Samsung Electronics: Maintain Buy despite market’s overconcern

Global Markets Research

Samsung Electronics 005930.KS 005930 KS 30 July 2026

EQUITY: TECHNOLOGY

Rating Remains BuyMaintain Buy despite market’s overconcern

Target price KRW 670,000 RemainsSevere shortage continues, even stronger LTAs could ease business risk

Closing price KRW 207,000 30 July 2026Maintain Buy and TP of KRW670,000

We maintain our Buy rating and TP of KRW670,000 (implied upside of 224%), which is Implied upside +223.7%based on applying a target P/B of 5.0x to 12MF BVPS of KRW133,139. Unlike the market’

s overconcern, we reiterate our optimistic view on the memory market and Samsung Market Cap (USD mn) 842,538.2

Electronic’s (SEC) earnings outlook. We think that memory supply shortage in 2027-28F ADT (USD mn) 5,259.6

is already quite likely, and risk premium will decrease due to stronger-than-expected LTAs

(long-term agreements). We expect SEC’s sizeable shareholder returns to trigger a re-

rating, and 2027F shareholder return yield to be 18% based on the current share price. Relative performance chart

2Q results: All about memory

In 2Q, SEC’s revenue was KRW171tn (+28% q-q) and OP was KRW89tn (+56% q-q), far

exceeding market expectations on the back of rising memory prices. Part of the

accounting provision for bonuses appears to have been deferred, so the actual impact

was smaller than expected. DRAM/NAND prices rose 40%/66% q-q, and HBM shipments

in particular jumped 55% q-q; SEC’s HBM revenue this year is set to rise to roughly 3x y-

y, in our view. The Foundry business’ loss widened following recognition of bonus

expenses. The MX division turned to a loss on the back of higher memory costs.

3Q26F OP to grow to KRW114tn (+28% q-q) led by memory price and volume increases