[Edaily Reporter Kwon Oh Seok ] IBK Investment & Securities announced on the 2nd that it is maintaining its “Buy” rating and 460,000 won target price for SamsungElectronics(005930).

Kim Un-ho, an analyst at IBK Investment & Securities, stated, “We expect the memory supply shortage to persist for the long term, and as a result, profitability is expected to remain at current levels.” He added, “We anticipate stable growth in profit margins and believe the stock is significantly undervalued.”
The firm projected that SamsungElectronics’ third-quarter earnings would fall short of previous forecasts. Revenue is expected to reach 195.2 trillion won, a 13.8% increase from the previous quarter, while operating profit is projected to rise 13.6% to 101.7 trillion won. He noted, “The operating profit margin is projected to be 52.1%, down 0.1 percentage points from the previous quarter,” adding, “We estimate that the won-dollar exchange rate was a key factor. We also expect the impact of a portion of performance bonuses that were not paid out in the second quarter being reflected in the third quarter.”
For the DS division, revenue is estimated at 149.9 trillion won and operating profit at 101.8 trillion won; for the Display division, revenue is estimated at 8.8 trillion won and operating profit at 0.9 trillion
won; and the MX and Network segments are expected to post revenue of 34.3 trillion won and an operating loss of 1.1 trillion won. The firm also anticipates that the operating loss for the VD and Home Appliances segments will widen.
Analyst Kim noted, “Interest in shareholder returns has grown since August 21. While the scale of share buybacks may not be large, the scale of shareholder returns via dividends is expected to reach an all-time high,” adding, “This level is on par with leading global IT companies. Since memory companies have never before executed shareholder returns exceeding 100 trillion won, the impact on the stock price is a key point to watch—but it is expected to have a positive effect.”
He further noted, “While this does not directly improve EPS (earnings per share) through share buybacks, we believe that stable and sustained shareholder returns will serve as an opportunity for the stock to be valued at an even higher level.”