Samsung Electronics headquarters in Seoul’s Seocho District (Image courtesy of Yonhap)
SEOUL, May 29 (Korea Bizwire) – While Samsung Electronics, once riding high on expectations of reaching 1 million won per share, has again faltered in the 800,000 won range, analysts on Wall Street remain optimistic about the tech giant’s stock prospects.
Foreign investors have been offloading over 7 trillion won worth of Samsung shares they had heavily bought into this year, but the overall sentiment among experts still points toward the elusive 1 million won target.
On May 28, Samsung Electronics closed at 776,000 won, up 4,000 won (0.52%) from the previous trading day.
However, foreign investors have sold 1.2 trillion won worth of Samsung shares this month, flipping to a net selling position for the first time this year.
Until April, they had been consistent net buyers, accumulating 7.6 trillion won worth of the tech behemoth’s shares.
As the largest company by market capitalization on the Korean stock exchange and a semiconductor powerhouse, Samsung’s share price has been trapped in the 800,000 won range for most of 2024, fluctuating in a frustrating pattern.
The stock briefly reclaimed the 800,000 won level on May 7, buoyed by a global semiconductor rally, but quickly retreated back to the 700,000 won range within two days.
The situation worsened on May 2 when a Reuters report claimed that Samsung had failed a quality test for supplying high-bandwidth memory (HBM) to Nvidia.
Foreign investors dumped 560 billion won worth of Samsung shares that day, causing a 3% plunge in the company’s stock price, despite Samsung’s immediate denial and assertion that testing was still ongoing.
Samsung is viewed as being at a relative disadvantage in the booming HBM market, driven by soaring demand from AI applications, as rival SK Hynix has effectively monopolized HBM supply to Nvidia.
While SK Hynix shares have surged over 40% this year, Samsung’s stock has declined more than 1%, highlighting the contrasting fortunes.
Nevertheless, Wall Street’s outlook on Samsung remains positive. Analysts expect the company’s enterprise value to increase amid the HBM supply shortage and limited short-term capacity expansion capabilities of competitors.
The ramp-up of the fourth-generation HBM3 product is also anticipated to boost Samsung’s earnings in the second half of the year.
Kevin Lee (kevinlee@koreabizwire.com)
