Samsung Electronics' third-quarter earnings this year have fallen far short of market expectations, leading securities firms to lower their target stock prices one after another.
In its preliminary earnings announcement on the 8th, Samsung Electronics reported sales of 79 trillion KRW and an operating profit of 9.1 trillion KRW, below the market's forecast of 80.87 trillion KRW in sales and 10.3047 trillion KRW in operating profit.
Due to this earnings shock, major securities firms such as KB Securities, NH Investment & Securities, Eugene Investment & Securities, and Hyundai Motor Securities have downgraded their target stock prices for Samsung Electronics.
Notably, Kim Dong-won, a researcher at KB Securities, lowered the target stock price from 95,000 KRW to 80,000 KRW, while Lee Seung-woo, a researcher at Eugene Investment & Securities, pointed out that the non-memory segment's performance worsened due to a rise in one-time costs, and he projected that earnings pressure may persist into the fourth quarter.
On the other hand, some experts have argued that the poor earnings should not be overly exaggerated.
Park Yoo-ak, a researcher at Kiwoom Securities, noted the positive impact of rising DRAM and NAND prices, and explained that the non-memory sector's weakness was due to one-time costs and increased production costs from low yield rates. He also positively evaluated Samsung's efforts to enhance communication with the market.
Park also predicted that while disappointment in Samsung's technological leadership has been reflected in the stock price decline, there could be changes in the company's future strategy.
While the prevailing opinion among securities analysts is that Samsung's short-term momentum will weaken, there is also an analysis that the current stock price is relatively low compared to historical averages, limiting the risk of further decline.
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Samsung Electronics' Q3 Earnings Shock, Securities Firms Downgrade Target Stock Prices
Samsung Electronics' third-quarter earnings this year have fallen far short of market expectations, leading securities firms to lower their target stock prices
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