Mirae Asset Securities stated that Samsung Electronics' stock price is excessively reflecting macroeconomic uncertainties, maintaining a 'buy' rating and a target price of 370,000 won. The firm believes that record-high shareholder returns, improvements in the memory market, and competitive custom HBM technology could lead to a reevaluation of the company's value.
In a report released after the market closed the previous day, analyst Kim Young-geon noted, "The current price-to-book (P/B) and price-to-earnings (P/E) ratios are at 1.7 times and 4.3 times, respectively, which have dropped to levels seen before the AI cycle." He added, "There are limited meaningful changes in the operating environment and industry outlook."
On August 21, Samsung Electronics announced plans for shareholder returns of 90 trillion to 110 trillion won for 2026. Approximately 30 trillion won in cash dividends will be distributed in the third quarter, with the remaining amount to be confirmed by the board in January next year. Based on the previous day's closing price, the maximum dividend yield for 2026 is projected to be 8.3% for common shares and 11.0% for preferred shares.
The memory market outlook is also positive. Mirae Asset Securities has maintained its operating profit forecasts for Samsung Electronics at 120 trillion won for the third quarter and 126 trillion won for the fourth quarter, estimating 559 trillion won in operating profit for 2027. The firm anticipates tight DRAM supply until 2028, predicting a 15% increase in DRAM average selling price (ASP) in the third quarter, 5% in the fourth quarter, and 22% in 2027, primarily driven by HBM price increases.
The growing demand for AI infrastructure in China is expected to support HBM demand. Analyst Kim reported that during visits to seven local semiconductor companies in China from August 17 to 22, he observed a surge in AI infrastructure demand, with the focus shifting from government subsidies to actual demand from CSPs and AI model companies. However, he noted that China's self-sufficiency in HBM is lower than expected, with local accelerator companies estimating that they will achieve HBM3 self-sufficiency in about two years.
Kim also positively assessed Samsung Electronics' next-generation HBM technology. At 'Hot Chips 2026,' Samsung unveiled its custom HBM roadmap, including 'zHBM,' which stacks memory on top of XPU without an interposer. This technology is designed to reduce power consumption by approximately 70% and reallocate the saved 100W for GPU computations.
Kim stated, "zHBM represents an uncharted territory for the industry, based on hybrid bonding with a pitch of less than 6 micrometers and memory-SoC integrated design, a technology that only Samsung Electronics, with its capabilities in memory, advanced foundry, and packaging, can internalize."
* This article has been translated by AI.
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