IBK Investment & Securities announced on July 16 that it expects Samsung Electro-Mechanics to achieve record annual performance in 2026, driven by growth in flip-chip ball grid array (FC-BGA) substrates for artificial intelligence (AI) semiconductors and multilayer ceramic capacitors (MLCC). The firm raised its target price for Samsung Electro-Mechanics from 1,050,000 won to 1,750,000 won, an increase of 66.7%, while maintaining a 'buy' rating.
Kim Un-ho, a researcher at IBK Investment & Securities, analyzed that the recent buying trend from foreign investors reflects Samsung Electro-Mechanics' growth potential. He stated, "Even as AI-related companies reduce their shareholdings, Samsung Electro-Mechanics continues to see sustained buying interest, indicating a strong outlook for FC-BGA and MLCC growth."
IBK Investment & Securities anticipates that large-scale facility investments to meet the growing demand for AI semiconductors will begin in earnest. It also expects that the ongoing supply shortage of high-performance MLCC products will lead to improved performance. Consequently, the firm projects operating profit to rise to 1.8 trillion won in 2026 and 2.9 trillion won in 2027.
This year, operating profit is expected to increase by 93% compared to 2025, reaching an all-time high. The package division is anticipated to lead this growth. Estimated operating profits by segment include 463.2 billion won for the package division, more than triple the amount from 2025, 1.1423 trillion won for the components division, an increase of 84.6%, and 158.5 billion won for the optical division, a 5.6% rise.
In particular, the expansion of server applications is expected to drive growth in MLCC, while the package division will benefit from increased orders for server and application-specific integrated circuits (ASICs). The package division's operating profit is projected to reach 1.7 trillion won by 2028. Kim noted, "The improvement in operating profit is expected to continue from 2023, which is seen as a low point, reaching 4.8 trillion won by 2028."
* This article has been translated by AI.
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