NH Investment & Securities said there is a bargain-buying opportunity for Samsung Heavy Industries(010140) as the floating data center business has entered a concrete phase.
However, given the downward revision of long-term growth and the limited room for dollar-denominated price increases for LNG carriers, the target price was cut to 32,000 won from 34,000 won. The previous trading day's Samsung Heavy Industries closing price was 21,000 won.
Jeong Yeon-seung of NH Investment & Securities said, "Talks are underway with Mousterian to build two 50MW-class floating data centers, and the project has entered the detailed design stage," and noted, "Considering the goal of beginning operations in the first half of 2028, there is a high possibility of signing a basic contract within 2026."
The valuation also looked attractive. Jeong said, "The current share price implies an estimated 2028 price-earnings ratio (PER) of 10, the least burdensome among major domestic shipbuilders," and added, "If orders for floating data centers, a new growth driver, are confirmed, the share price will turn around."
However, the target price was lowered because the room for dollar-denominated price increases for LNG carriers, the mainstay vessel type of Korean shipbuilders, is limited.
Jeong projected Samsung Heavy Industries' third-quarter sales this year at 3.311 trillion won and operating profit at 354.5 billion won. Those figures are up 25.8% and 48.9%, respectively, from a year earlier.
Jeong said, "Despite fewer working days, overall growth will continue as outsourced tanker construction expands," and forecast, "Medium- to long-term profitability will keep improving quarter by quarter through 2028 as unit prices of ships under construction and contract exchange rates rise."