Samsung Electro-Mechanics shares fell more than 12% in early trading, attributed to profit-taking following a recent surge in stock prices.
According to the Korea Exchange, as of 10:06 a.m., Samsung Electro-Mechanics shares were trading at 1,756,000 won, down 249,000 won (12.42%) from the previous trading day. This marks a second consecutive day of decline after a 5.74% drop the day before.
From April 1 to May 29, the company's stock skyrocketed approximately 422%, climbing from 407,500 won to 2,127,000 won, the highest increase among listed companies on the KOSPI during that period.
The surge was driven by heightened expectations for growth in the semiconductor substrate and multilayer ceramic capacitor (MLCC) sectors, fueled by increased investment in artificial intelligence (AI) infrastructure. However, the rapid rise has led to increased pressure, resulting in concentrated profit-taking.
Analysts continue to view Samsung Electro-Mechanics' long-term growth potential positively. They anticipate an increase in average selling prices (ASP) due to rising demand for flip chip ball grid array (FCBGA) and MLCC products, alongside the potential for sustained favorable market conditions based on long-term supply contracts (LTA).
This month, brokerage firms have also been raising their target prices for the company. Mirae Asset Securities raised its target price to 2,800,000 won on June 1, while DB Securities set a target of 3,000,000 won.
Jo Hyun-ji, a researcher at DB Securities, stated, "The investment point for Samsung Electro-Mechanics lies in its large-scale expansion amid a shortage situation and the demand secured post-expansion. We expect FCBGA sales to rise sharply to 1.9 trillion won in 2026, 2.8 trillion won in 2027, and 4.6 trillion won in 2028."
She added, "Both FCBGA and MLCC have entered an unprecedented boom phase, and Samsung Electro-Mechanics possesses irreplaceable technological competitiveness among global component manufacturers."
* This article has been translated by AI.
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