Samsung ElectronicsSamsung Electronics Co., Ltd. · 005930
Memory-driven profit has set records for four straight quarters, but foreign selling and peak-earnings debate weigh on the stock, so the overall call is HOLD
World's largest memory maker: record Q3 operating income of ₩107.4T, yet the stock fell 13.4% in two days on Nov 5-6 and sits 46.9% below its 52-week high. Operating margin rose from 6.3% a year earlier to 52.2% in Q2 and 55.0% in Q3, while the drop was a flow shock led by foreign net selling (₩1,160B of Samsung on Nov 5), with the Nov 5 Bizwatch report citing AI data-center regulation worries as the backdrop (S5).
Research team debate
Of six issues, the Nov 5-6 plunge, valuation and shareholder returns went to Bull and peak earnings, profit concentration and foreign flows to Bear, so the weighted 4-to-3 result is HOLD.
The overall call is HOLD: earnings, shareholder returns and a low multiple argue Bull, while peak-earnings debate, profit concentration and weak flows argue Bear. The call reopens with the Q3 quarterly filing around Nov 14 and whether foreign net selling subsides.
- Bull case — the Nov 5 plunge was a market shock alongside KOSPI -5.28%, while Q3 operating income of ₩107.4T, a 2.7x forward P/E and net cash of about ₩167.6T are unchanged.
- Bear case — operating income growth slowed from +56.4% to +20.0%, 99% of profit comes from chips, and the close is below every moving average.
- Hold — no issue was held. The call changes if the filing around Nov 14 confirms operating cash flow and foreign flows in Samsung turn from net selling to net buying.
1aDebate by Issue · 6
The plunge is not an earnings problem. On Nov 5, when KOSPI fell 5.28% and a sell sidecar triggered, Samsung dropped 7.57% and SK hynix 9.46%. Q3 operating income of ₩107.4T (55.0% margin) and net cash of about ₩167.6T are unchanged.
Good results did not stop the decline. The stock fell 4.13% on Oct 29, the day Q3 results came out, and another 6.35% on Nov 6, losing 13.4% in two days. Volume of 35.52M shares on Nov 6 was 1.85x the 20-day average of 19.24M, so the selling was heavy.
This looks like a flow shock. Of ₩3,390B net foreign selling on Nov 5, about ₩2.7T hit just Samsung and SK hynix. Bizwatch (S5) cited AI data-center regulation worries after the US midterms as the backdrop.
The question was whether the cause lies with the company. The cause is confirmed only within the Nov 5 Bizwatch report, and the link to regulation worries is not asserted since the stock fell just 0.68% on Nov 4, but the drop was a foreign-flow shock alongside KOSPI -5.28% and earnings power (₩107.4T operating income) is intact, so the ruling goes to Bull.[S1·S3·S5]
Earnings are still rising. Operating income grew from ₩57.2T in Q1 to ₩89.5T in Q2 and ₩107.4T in Q3, and per coverage (S3) the company expects the memory shortage to deepen next year, with HBM4 supply expansion and HBM4E mass production planned.
The higher profit climbs, the louder the peak worries. Operating margin jumped more than eightfold from 6.3% (Q2 2025) to 55.0%, leaving little room for prices to rise further, and Q3 net income growth (+5.4%) lagged operating income growth (+20.0%). A stock 46.9% below its 52-week high suggests the market is already pricing in a slowdown.
The question is how far profit can keep growing. Operating income growth slowed from +56.4% in Q2 to +20.0% in Q3, and the stock sits 46.9% below its high, so Bear's point that the market priced the slowdown first carries more weight. The ruling goes to Bear.[S2·S3]
Price is low relative to earnings. A 2.7x forward P/E is about one fifth of the 12.9x peer median, and expected EPS rises 62.3% from ₩47,639 to ₩77,324 this year to next, for a PEG of about 0.04 on one-year expected EPS growth. TTM P/E of 8.9x is also less than half the 18.2x at end-2025.
A cheap multiple matters only if earnings last. Memory profit swings with prices: P/E reached 36.8x at end-2023 (EPS ₩2,131) and fell to 10.7x at end-2024. A low multiple can signal that the market doubts current profit will last.
The question is whether the stock is expensive relative to growth. A PEG of about 0.04 (on one-year expected EPS growth) is low even against the 12.9x peer median and 62.3% growth, so the ruling goes to Bull. If EPS forecasts are cut the multiple would rise, so forecast changes are checked at Q4 results around Jan 27.[S1·S4·S7]
Shareholder returns can support the floor. The Q3 dividend is ₩4,601 per share (₩30T across common and preferred shares) and the 2026 target is ₩90-110T, roughly 8-10% of the ₩1,135.6T market cap.
Only the dividend is fixed. Buyback and cancellation details are due at the January 2027 board meeting per the company (S3 coverage; the two DART treasury-share disposal filings were checked by title only), and the Nov 5 Bizwatch report (S5) says Life Asset Management wrote to the board's special committee asking it to examine harm to shareholder value and conflicts of interest. Criticism that returns fall short remains.
The question is whether returns build a floor. The confirmed Q3 dividend alone is about 2.6% of market cap and the ₩90-110T annual target fits within net cash of about ₩167.6T, so the ruling goes to Bull. Buyback details come at the January 2027 board meeting.[S3·S5]
Cash is ample, so the burden is small. Q2 free cash flow was ₩90.3T (operating cash flow ₩105.1T minus capex ₩14.8T), and total debt of ₩22.4T is about 12% of cash of ₩190T. The DX loss of ₩800B is under 1% of ₩107.4T operating income.
The issue is concentration and speed, not size. The ₩84.4T capex plan is 61.7% above 2025's ₩52.2T, with ₩76.8T for chips (S3 coverage; 2025 figure from Yahoo/DART, S2). With chips earning about 99% of operating income and DX losing money two quarters running, nothing offsets a fall in memory prices.
The question is investment burden and profit concentration. Cash is ample, but 99% of profit comes from chips and capex is up 61.7%, so Bear's point that nothing absorbs a fall in memory prices carries more weight. The ruling goes to Bear.[S2·S3]
A rebound has begun. The Nov 10 close of ₩198,900 was up 4.74% from ₩189,900 and just under the 5-day line at ₩199,400, and volume of 15.29M shares was 0.79x the 20-day average, so selling pressure has eased.
This is not yet a trend reversal. The close is below the 5-, 20-, 60-, 120- and 200-day lines, 8.6% under the 20-day line at ₩216,000, and foreigners net sold ₩1,160B of Samsung on Nov 5. A rebound on shrinking volume can mean weak conviction.
The question is whether the rebound is a trend change. A one-day 4.74% gain on lower volume with the close below every moving average earns a Bear ruling. Recovering the 20-day line at ₩216,000 is the next test.[S1·S5]
1bScenarios
LightView does not issue its own target price. With no external target prices, the 52-week high, 200-day line and 52-week low are used as price references for scenarios
52-week high of ₩374,500 · foreign selling stops and the quarterly filing confirms cash flow
200-day line at ₩239,681 · the pre-plunge range of ₩232,000-242,000 closes on Oct 28-29 is regained
52-week low of ₩94,500 · foreign selling and AI regulation worries persist and cycle sentiment breaks
1cConditions That Change the Verdict
The verdict is based only on the data in this report and is not a recommendation to buy or sell.
Investment Summary
Q3 operating income is a record ₩107.4T, yet the ₩198,900 close is 46.9% below the 52-week high, and the Nov 5-6 plunge coincided with a market-wide flow shock.
High₩374,500
2aKey Data
Earnings and shareholder returns are at record levels, but flow shocks and regulation worries have taken the stock to about half its 52-week high, so the key is whether flows return.
2bKey Metrics
Financials are as of Q2 2026 (Jun 30) [S2]. Q3 reflects only the Oct 29 company release (revenue ₩195.3T, operating income ₩107.4T, net income ₩75.1T); operating cash flow, capex, EPS and other items are through Q2 pending the Q3 filing [S3].
Business & Competitive Advantage
Memory chips (DS) earn about 99% of operating income, DX lost ₩800B in Q3, and net cash is about ₩167.6T.
3aBusiness Structure
AI server demand drives this core business, which earns about 99% of operating income
Component cost increases led to losses of ₩600B in mobile and ₩200B in TV and appliances
A secondary profit pillar outside memory
Cash far exceeds debt, leaving ample room for dividends and buybacks
- Record Q3 · Revenue of ₩195.3T and operating income of ₩107.4T (55.0% margin) made it the first global tech company with quarterly operating income above ₩100T.
- Memory shortage · The company was reported (S3) to expect the memory supply shortage to deepen next year.
- Shareholder returns · It set a Q3 dividend of ₩4,601 per share (₩30T across common and preferred shares) and a 2026 shareholder-return target of ₩90-110T.
- Vision · It was reported (S3) to plan to expand HBM4 supply, start HBM4E mass production and ramp 2nm AI and HPC chips at its Taylor, Texas plant.
3bCompetitive Advantage (Moat) Assessment
Six sources rated Strong·Medium·Weak
The 55.0% Q3 operating margin reflects better pricing and mix in HBM and server memory.
Quarterly revenue of ₩195.3T supports planned annual capex of ₩84.4T.
Cash of ₩190T is more than eight times total debt of ₩22.4T.
DX lost ₩800B in Q3, so about 99% of operating income comes from chips.
Strong during shortages, but memory prices swing widely with the cycle.
Reported worries about tighter AI data-center regulation leave a policy variable on the demand side.
Memory profit and net cash provide defense, but the stock swings sharply on flows and regulation sentiment.
Earnings & Financials
Q2 2026 revenue was ₩171.5T and operating income ₩89.5T, followed by Q3 revenue of ₩195.3T and operating income of ₩107.4T; operating cash flow and capex are through Q2 pending the Q3 filing.
4aRevenue & Earnings
| Q2 2025 | Q3 | Q4 | Q1 2026 | Q2 | |
|---|---|---|---|---|---|
| Revenue | 74.6 | 86.1 | 93.8 | 133.9 | 171.5 |
| Operating Income | 4.7 | 12.2 | 20.1 | 57.2 | 89.5 |
| Net Income | 4.9 | 12 | 19.3 | 47.1 | 71.3 |
| Operating Margin | 6.3% | 14.1% | 21.4% | 42.8% | 52.2% |
The five-quarter table below runs through Q2 2026 (Yahoo and DART); only Q3 revenue, operating income and net income from the Oct 29 company release are in the tiles above. Operating margin rose 6.3%, 14.1%, 21.4%, 42.8%, 52.2%, and was 55.0% in Q3.
4bCash Flow
| Annual (FY ends Dec) | 2022 | 2023 | 2024 | 2025 |
|---|---|---|---|---|
| Operating Cash Flow | 62.2 | 44.1 | 73 | 85.3 |
| Capex | 53.1 | 60.5 | 53.7 | 52.2 |
| Free Cash Flow | +9.1 | −16.4 | +19.2 | +33.2 |
4cFinancial Structure
| Item | Now | Jun 2025 | Change |
|---|---|---|---|
| Cash and short-term investments (Jun 30) | ₩190T | ₩100.7T | +88.6% |
| Total debt (Jun 30, Yahoo basis) | ₩22.4T | ₩14T | +59.7% |
| Shareholders' equity (Jun 30) | ₩565.1T | ₩388.7T | +45.4% |
4dProfitability Metrics
| Metric | Q2 | 1 year ago | Calculation |
|---|---|---|---|
| Operating margin | 52.2% | 6.3% | Operating income ÷ revenue (Q2 2026) |
| Gross margin (Yahoo basis) | 69.6% | 34.2% | Gross profit ÷ revenue |
Valuation
TTM P/E of 8.9x and forward P/E of 2.7x are below the 12.9x peer forward median, and the PEG on 62.3% one-year expected EPS growth is about 0.04.
5aP/E trend
P/E = price ÷ earnings per share (EPS). TTM uses last-4-quarter EPS of ₩22,463 through Q2 2026, so Q3 is not included; Forward uses expected next-12-month EPS of ₩73,179.
The Nov 10 close of ₩198,900 is 8.9x last-4-quarter EPS and 2.7x expected next-12-month EPS. EPS is expected to rise 62.3% from ₩47,639 this year to ₩77,324 next year, for a PEG of about 0.04 on one-year growth, versus a peer forward median of 12.9x.
5bPrice Range · 52-Week
52-week range is intraday (low 25.11.21 · high 6/19) · No external price targets, so only the 52-week range is shown
5cPeer Multiples Comparison
| Company | PER (TTM) | Forward PER | P/S | Market Cap |
|---|---|---|---|---|
| SK hynix 000660 | 5.6x | 2.4x | 4.6x | about ₩861.8T |
| Samsung Electronics 005930 | 8.9x | 2.7x | 2.3x | about ₩1,135.6T |
| Hyundai Motor 005380 | 7.1x | 6.6x | 0.3x | about ₩55.8T |
| Samsung Electro-Mechanics 009150 | 72.9x | 19.3x | 5.1x | about ₩64.1T |
| Hanmi Semiconductor 042700 | 64.0x | 40.1x | 29.8x | about ₩16.4T |
Nov 10 close · peer median TTM 35.5x, Forward 12.9x, P/S 4.8x (four peers excluding Samsung) · Samsung market cap and P/S use close × shares (collector values)[S7] · Peers are four KRW-denominated chip, component and auto companies
Chart & Options
The ₩198,900 close is below the 5-, 20-, 60-, 120- and 200-day lines, 8.6% under the 20-day line at ₩216,000, with RSI at 37.8.
6aKey Price Levels Above and Below Current Price
Each colored bar matches the same-colored line on the chart; the percentage is the distance from the current price (green above · red below)
6bTechnical Indicators
News & Schedule
AI regulation worries spread after the US midterms on Nov 4, then KOSPI fell 5.28% and Samsung 7.57% on Nov 5 and 6.35% more on Nov 6; Q3 results and the dividend came on Oct 29.
7aNews
11/6 Volume 35.52M shares
11/5 Volume 24.66M shares
11/4 Volume 22.25M shares
10/29 Volume 24.98M shares
10/29 Volume 24.98M shares
7bUpcoming Events
Macro
The US 10-year yield is 4.98%, WTI December $86.04 and VIX 19.46, with KOSPI down 7.3% since Nov 3.
Street Opinions
Fewer than three individual broker targets were found, so the table is empty; Yahoo's tally averages ₩475,629 from 35 analysts.
Fewer than three brokers' individual price targets were found in Korean press, so no targets are shown and peer comparison is used instead (Yahoo's tally is a ₩475,629 average from 35 analysts (its opinion count is 36, differing from the analyst count), but individual firms are unverified).
9aPeer Comparison
| Company | PER (TTM) | Forward PER | P/S | Market Cap |
|---|---|---|---|---|
| SK hynix 000660 | 5.6x | 2.4x | 4.6x | about ₩861.8T |
| Samsung Electronics 005930 | 8.9x | 2.7x | 2.3x | about ₩1,135.6T |
| Hyundai Motor 005380 | 7.1x | 6.6x | 0.3x | about ₩55.8T |
| Samsung Electro-Mechanics 009150 | 72.9x | 19.3x | 5.1x | about ₩64.1T |
| Hanmi Semiconductor 042700 | 64.0x | 40.1x | 29.8x | about ₩16.4T |
Nov 10 close · peer median TTM 35.5x, Forward 12.9x, P/S 4.8x (four peers excluding Samsung) · Samsung market cap and P/S use close × shares (collector values)[S7]
Risk Analysis
The largest risks are persistent foreign selling, AI regulation worries and the memory peak-profit debate; Q3 cash flow is confirmed in the quarterly filing.
| Risk | Type | Likelihood | Impact | Dates to Watch |
|---|---|---|---|---|
| Persistent foreign net selling (₩1,160B of Samsung on Nov 5) | Flows | High | High | Whether foreigners turn net buyers of Samsung |
| Tighter AI data-center regulation worries | Policy | High | Medium | Legislative talk after the US midterms |
| Memory peak-profit worries (operating income growth +56.4% to +20.0%) | Earnings | High | Medium | Q4 results around Jan 27 |
| DX loss (−₩800B in Q3) and ₩84.4T capex | Finance | Medium | Medium | Capex spending in the quarterly filing |
| Official Q3 operating cash flow and EPS not yet released | Finance | Medium | Medium | Quarterly filing around Nov 14 |
| Close below every moving average (46.9% below the 52-week high) | Price | High | Medium | Whether it regains the 20-day line at ₩216,000 |
Likelihood and impact rated High·Medium·Low · When it clears: When it clears: foreign net selling easing and the Q3 quarterly filing around Nov 14 (cash flow, capex)
Checkpoints & Open Questions
Most important are easing foreign selling and operating cash flow in the Q3 filing around Nov 14, alongside the KOSPI 5,200 level and a recovery of the 20-day line.
11aCheckpoints
11bOpen Questions
Sources & Data Dates
Numbers without a source are not published.
| ID | Type | Provider | Content | As-of Date |
|---|---|---|---|---|
| S1 | Prices and indicators | Yahoo Finance | Closes, moving averages, RSI, 52-week range, Supertrend, Bollinger bands, market cap (close × shares) | 2026.11.10 |
| S2 | Financials | Yahoo Finance quarterly and annual tables, DART business and quarterly reports | Quarterly revenue, profit, cash flow and balance sheet through Q2 2026 · quarter labels are calendar-based | 2026.11.11 |
| S3 | Q3 results | Samsung Electronics Q3 results coverage (https://news.bizwatch.co.kr/article/industry/2026/10/29/0011/) | Revenue ₩195.3T, operating income ₩107.4T, net income ₩75.1T, divisional results, capex and dividend plans | 2026.10.29 |
| S4 | Consensus | Yahoo Finance | Average target from 35 analysts, expected EPS and revenue | 2026.11.11 |
| S5 | Nov 5 market | Bizwatch (https://news.bizwatch.co.kr/article/market/2026/11/05/0035) | KOSPI -5.28%, foreign net selling, sidecar, AI regulation worries, Life Asset Management letter | 2026.11.05 |
| S6 | DART filings | Financial Supervisory Service DART (https://dart.fss.or.kr) | Filing list for the last 60 days (earnings, dividend, treasury-share disposal decision) · ownership reports not opened | 2026.11.11 |
| S7 | Peer comparison | Yahoo Finance | P/E and P/S for SK hynix, Hyundai Motor, Samsung Electro-Mechanics and Hanmi Semiconductor | 2026.11.10 |
| S8 | Macro | Yahoo Finance | US 10Y, WTI, USD/KRW, gold, bitcoin, VIX, KOSPI | 2026.11.10 |
| S9 | Broker targets | The Check (https://thecheck.co.kr/?p=7794) | Yuanta ₩690,000 and KB Securities ₩600,000 (as reported Oct 30) | 2026.10.30 |
Price as of the Nov 10, 2026 close · financials through Q2 2026 (Yahoo Finance, DART) plus the Q3 company release (Oct 29 coverage) · Nov 5 market color from Bizwatch
※ Based on research team debate tally · of six issues, Bull won three (the Nov 5-6 plunge is the key issue at weight 2, plus valuation and shareholder returns at 1 each = 4 votes) and Bear won three (peak earnings, capex and DX losses, foreign flows and chart at 1 each = 3 votes) · no holds → weighted Bull 4 vs Bear 3, a one-vote gap, so HOLD