Anna Jiwon Park has been covering the politics at The Korea Times since the summer of 2024, when she joined the press pool for the Office of the President in Korea. Prior to that, she spent about five years reporting extensively on financial markets, regulatory authorities and the financial industry. She joined The Korea Times in 2019 after spending eight years as a broadcast journalist at Arirang TV, Korea’s leading global broadcaster, covering politics, defense and culture.
Analysts split over future course of Samsung Electronics stocks
Samsung Electronics' sign in front of a company building / Newsis
By Anna J. Park
Tech giant's stock price falls below 70,000 won
By Anna J. Park
Samsung Electronics shares are continuing their downward spiral, prompting retail investors to wonder if they should sell their stocks. Most analysts remain positive that the company's stock price could take off again in the second quarter, while others say a rebound isn't likely until the current global geopolitical risks are at least eased.
The country's largest market cap company closed at 69,500 won, Tuesday, falling below 70,000 won ($56.60) and recording a 0.86 percent drop from the previous trading session. With both overseas and institutional investors net-selling, the stock price broke the 70,000 won mark for the first time since last November and is getting closer to its 52-week low of 68,300 won logged last October.
As the global chip and mobile phone maker's stock price has been showing bearish patterns particularly since the fourth quarter of last year, the number of the firm's minor shareholders ― who own less than 1 percent of the firm's total shares ― dwindled to 5.06 million last December from 5.18 million in September. It was the first time in two years that the number of minor shareholders decreased in the quarterly analysis.
While stock prices have fallen by more than 12 percent since the start of the year and retail investors' interest seems to have faded away, market analysts still think the share price could take off again in the second quarter of this year.
“The current stock price of Samsung Electronics is now in the realm of undervaluation, which already factored in most of the unfavorable external and internal events surrounding the firm,” BNK Securities analyst Lee Min-hee said.
“Samsung Electronics' projected operating profit for this year is around 40 percent of Apple's, and 160 percent of TSMC's. Yet, its market cap is only about 13 percent of Apple's and 64 percent of TSMC's,” she explained.
Other market analysts shared a similar rosy outlook on the global chipmaker.
“Samsung Electronics is expected to log a quarterly revenue growth, with the first quarter's revenue being the lowest. The first quarter's revenue and operating profit are forecast to be 76.2 trillion won and 12.7 trillion won, respectively, which are year-on-year increases of 17 percent and 35 percent,” said Suh Seung-yeon, analyst at Shinyoung Securities.
However, voices of caution are also being heard among analysts, who point out that the prices will not pick up until after the current global geopolitical risks are somewhat resolved.
“As the situation in Ukraine is has carried on longer than expected, the prices of energy and raw materials are soaring amid strengthened global sanctions on Russia. No matter how much global demand for IT products as well as their prices rise, geopolitical issues have overshadowed these fundamental issues. Thus, the resolution of the geopolitical crisis would be a prerequisite for the rally of Samsung Electronics,” Eugene Investment & Securities analyst Lee Seung-woo said.