[Edaily Reporter Kim Kyung-eun ] SamsungElectronics(005930) Analysts suggest that now is a good time to start buying shares in installments as stock prices approach historically undervalued levels. Although the domestic stock market has experienced a sharp sell-off that triggered circuit breakers, analysts advise focusing on valuation (the price-to-book ratio) rather than the causes of the decline. They explain that, just as stock prices rebounded before negative factors were resolved during past semiconductor downturns, investors should consider making gradual purchases once SamsungElectronics’ stock price enters the 170,000–180,000 won range.

Park Jun-young, an analyst at HANWHA INVESTMENT & SECURITIES, stated in a report on the 6th, “The most consistent criterion for determining the bottom of semiconductor stock prices is valuation,” adding, “Although the negative factors that put pressure on stock prices and the duration of the downturn varied in each past downturn cycle, valuations at historical lows formed within a similar range.”

According to HANWHA INVESTMENT & SECURITIES, SamsungElectronics’ 12-month forward price-to-book ratio (PBR) stood at 0.95x in January 2019, 1.03x in September 2022, and 0.83x in November 2024—the periods when historical price lows were formed. The average of these three instances is 0.94x.

At this point, the firm left open the possibility of further declines in SamsungElectronics’ stock price. Applying the average PBR of 0.94x from the three historical lows, SamsungElectronics’ stock price could fall to 163,000 won. However, the firm assessed the likelihood of a decline to 144,000 won—based on the PBR of 0.83x recorded in November 2024—as low. This is because, unlike at that time, there are now expectations for an expansion in High-Bandwidth Memory (HBM) supply and improvements in product competitiveness.

Analyst Park suggested a price of around 178,000 won—calculated by applying a historical low PBR of 1.03x to SamsungElectronics’ 12-month forward book value per share (BPS) estimate of 173,079 won—as the starting point for gradual purchases. The average price-to-book ratio (PBR) at the lows of 2019 and 2022 was 0.99x, indicating that major lows have historically formed around a PBR of 1x.

In fact, if one had purchased SamsungElectronics at the lows in January 2019, September 2022, and November 2024, the maximum upside potential to the subsequent peak in the upward cycle would have been 163%, 71%, and 651%, respectively. While these are maximum gains confirmed in hindsight, the analysis explains that investors who bought during historically undervalued periods were presented with significant profit opportunities.

It is also worth noting that past stock price rebounds occurred before the resolution of negative factors. When SamsungElectronics’ stock price hit bottom in early 2019, the U.S.-China trade dispute was still ongoing, and memory prices and earnings continued to deteriorate. Similarly, at the September 2022 low, the U.S. Federal Reserve (Fed) was raising interest rates, and global IT demand remained sluggish.

Analyst Park noted, “The stock price did not rebound because the negative factors disappeared; rather, buying opportunities arose when prices had fallen sufficiently to reflect those negative factors,” adding, “Waiting for all uncertainties to be resolved could result in missing out on the most attractive investment window.” He emphasized, “While it is difficult to conclude that the current uncertainties surrounding the semiconductor sector will be resolved in the short term, it is now time to determine the price at which to begin buying based on valuation, rather than searching for and explaining the reasons behind the stock price decline.”

He also noted that improved earnings at semiconductor companies do not necessarily lead to rising stock prices. Even after SamsungElectronics’ stock price peaked in November 2017, its operating profit in 2018 increased by 9.8% year-over-year. Even after reaching a stock price peak in January 2021, its operating profit for that year rose by 43.5%. In 2025, following the peak in July 2024, operating profit increased by 33.2%, yet the stock price fell.

Analyst Park added, “This is a common phenomenon because semiconductor stock prices reflect future profit growth rates and changes in market expectations before they reflect current profit levels,” noting, “The fact that future earnings will improve is not a sufficient condition for a stock price rise, and there are limitations to determining a stock’s bottom based solely on earnings forecasts.”