KB Securities said on the 23rd that Samsung Electronics is expected to outperform expectations in the pace of semiconductor earnings improvement due to a recent surge in memory demand. It raised the target price to 110,000 won and maintained a "buy" rating.
Kim Dong-won, an analyst at KB Securities, said, "We revised this year's and next year's net profit to 34 trillion won and 52 trillion won, up 16.1% and 24.4% from the previous estimates," and added, "In the second half, the semiconductor institutional sector operating profit will come in at 2.08 trillion won, up 33% from a year earlier."
Kim said, "For the high bandwidth memory (HBM) HBM4 to be installed in Nvidia Rubin next year, Samsung Electronics is expected to build a favorable position versus competitors," adding, "Samsung Electronics' HBM4 applies 1c DRAM and a 4-nanometer (nm; 1 nm = one-billionth of a meter) logic die (the chip that serves as the brain at the very bottom of HBM), delivering the highest performance (11 Gbps) among suppliers and is therefore expected to meet both Nvidia's spec upgrades and volume increases."
He added, "The visible supply of 12‑high HBM3E that has passed Nvidia's final quality test, along with the expanded possibility of new HBM4 supply, will serve as a strong reference in the global HBM market, and shipments of HBM to big tech firms such as AMD, Broadcom, Amazon, and Google will surge simultaneously."
Kim projected that Samsung Electronics' results and share price in this cycle will be different from the past. He explained, "Barring new capacity additions for HBM next year, with general-purpose memory production capacity constrained, memory demand is diversifying from AI data centers to server DRAM, 7th‑generation graphics DRAM (GDDR7), the latest low‑power DRAM (LPDDR5X), and enterprise solid‑state drives (eSSD). With the HBM3E 12‑high quality test passed at Nvidia and the expanded possibility of supplying 1c DRAM HBM4, HBM shipments are expected to surge next year."