Korea Investment & Securities noted on the 17th that Samsung Securities' expected dividends yield for this year is in the 7% range, indicating significant progress in its shareholder return policy. Consequently, the investment opinion remains "buy," but the target price has been raised by 10% to 65,000 won. On the previous trading day, Samsung Securities closed at 46,750 won.
According to Korea Investment & Securities, Samsung Securities' net income for the fourth quarter of 2024 is forecasted to be 147.7 billion won, falling 5% short of market expectations. By institutional sector, net transaction fees are expected to be 138 billion won, reflecting a 1% increase from the previous quarter. Despite a decline in domestic stock revenue, revenue from overseas stock commissions increased by 36% to 68.9 billion won during the same period.
Advisory and consulting fees are projected to be 68.1 billion won, a 7% decrease compared to the previous quarter. While structured finance revenue, which largely comprises the investment banking commission revenue, is expected to be 57.3 billion won, the increase in revenue related to mergers and acquisitions and the debt capital market during the same period is viewed positively.
Profit and loss from product management and financial results are projected to be 210.7 billion won, a 26% decrease compared to the previous quarter, but an improvement of 270.7 billion won compared to the same period last year. Loan-related losses affecting product management profitability are limited to 29.3 billion won.
Baekdu Mountain at Korea Investment & Securities stated, "The dividend payout ratio, which had been gradually increasing in the past, has stagnated between 35% and 39% due to external variables from 2020 to the present," noting, "However, by presenting the long-term shareholder return rate target at 50%, it is noteworthy that the upper band for shareholder returns has been opened."
They added, "Although there is a need to expand self-capital through the use of a book and other investment banking business growth, it is clear that improving the dividend payout ratio will enhance the attractiveness of dividends yield in the long term."